(Mark One)
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þ
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 |
For the fiscal year ended February 1, 2019
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or
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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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For the transition period from to
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Delaware
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80-0890963
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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Title of each class
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Name of each exchange on which registered
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Class C Common Stock, par value $0.01 per share
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New York Stock Exchange
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Large accelerated filer þ
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Accelerated filer ¨
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Non-accelerated filer ¨
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Smaller reporting company ¨
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Emerging growth company ¨
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Page
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•
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Infrastructure Solutions Group (“ISG”) — ISG enables the digital transformation of our customers through our trusted multi-cloud and big data solutions, which are built upon a modern data center infrastructure. Our comprehensive portfolio of advanced storage solutions includes traditional storage solutions as well as next-generation storage solutions (such as all-flash arrays, scale-out file, object platforms and software-defined solutions), while our server portfolio includes high-performance rack, blade, tower and hyperscale servers. Our networking portfolio helps our business customers transform and modernize their infrastructure, mobilize and enrich end-user experiences, and accelerate business applications and processes. Our strengths in server, storage, and virtualization software solutions enable us to offer leading converged and hyper-converged solutions, allowing our customers to accelerate their IT transformation by acquiring scalable integrated IT solutions instead of building and assembling their own IT platforms. ISG also offers attached software, peripherals and services, including support and deployment, configuration, and extended warranty services.
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Client Solutions Group (“CSG”) — CSG includes branded hardware (such as desktops, workstations, and notebooks) and branded peripherals (such as displays and projectors), as well as third-party software and peripherals. Our computing devices are designed with our commercial and consumer customers’ needs in mind, and we seek to optimize performance, reliability, manageability, design, and security. In addition to our traditional hardware business, we have a portfolio of thin client offerings that we believe will allow us to benefit from the growth trends in cloud computing. CSG hardware and services also provide the architecture to enable the Internet of Things and connected ecosystems to securely and efficiently capture massive amounts of data for analytics and actionable insights for commercial customers. CSG also offers attached software, peripherals, and services, including support and deployment, configuration, and extended warranty services.
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VMware — The VMware reportable segment (“VMware”) reflects the operations of VMware, Inc. (NYSE: VMW) within Dell Technologies. See Exhibit 99.1 filed with this report for further details on the differences between VMware reportable segment results and VMware, Inc. results.
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Pivotal (NYSE: PVTL) provides a leading cloud-native platform that makes software development and IT operations a strategic advantage for customers. Pivotal’s cloud-native platform, Pivotal Cloud Foundry, accelerates and streamlines software development by reducing the complexity of building, deploying and operating new cloud-native applications, and modernizing legacy applications. In April 2018, Pivotal completed a registered underwritten initial public offering of its Class A common stock.
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Secureworks (NASDAQ: SCWX) is a leading global provider of intelligence-driven information security solutions singularly focused on protecting its clients from cyber attacks. The solutions offered by Secureworks enable organizations of varying size and complexity to fortify their cyber defenses to prevent security breaches, detect malicious activity in near real time, prioritize and respond rapidly to security incidents and predict emerging threats.
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RSA Security provides essential cybersecurity solutions engineered to enable organizations to detect, investigate, and respond to advanced attacks, confirm and manage identities, and, ultimately, help reduce IP theft, fraud, and cybercrime.
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Virtustream offers cloud software and infrastructure-as-a-service solutions that enable customers to migrate, run, and manage mission-critical applications in cloud-based IT environments. Beginning in the first quarter of Fiscal 2019, Virtustream results are reported within other businesses, rather than within ISG. This change in reporting structure did not impact our previously reported consolidated financial results, but our prior period segment results have been recast to reflect the change.
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Boomi specializes in cloud-based integration, connecting information between existing on-premise and cloud-based applications to ensure business processes are optimized, data is accurate and workflow is reliable.
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cash elections were made with respect to 181,897,352 shares, or 91.2% of the total outstanding shares of Class V Common Stock; and
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share elections (including deemed share elections with respect to shares for which no elections were made) were made with respect to 17,459,239 shares, or 8.8% of the total outstanding shares of Class V Common Stock.
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Name
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Age
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Position
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Michael S. Dell
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54
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Chief Executive Officer
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Jeffery W. Clarke
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56
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Vice Chairman, Products and Operations
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Allison Dew
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49
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Chief Marketing Officer
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Howard D. Elias
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61
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President, Services and Digital
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Marius Haas
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51
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President and Chief Commercial Officer
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Steven H. Price
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57
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Chief Human Resources Officer
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Karen H. Quintos
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55
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Chief Customer Officer
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Rory Read
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57
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Chief Operating Executive, Dell and President, Virtustream
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Richard J. Rothberg
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55
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General Counsel
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William F. Scannell
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56
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President, Global Enterprise Sales and Customer Operations, Dell EMC
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Thomas W. Sweet
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59
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Chief Financial Officer
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•
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Dell Technologies must use a substantial portion of its cash flow from operations to pay interest and principal on its senior credit facilities, its senior secured and senior unsecured notes, and its other indebtedness, which reduces funds available to Dell Technologies for other purposes such as working capital, capital expenditures, other general corporate purposes and potential acquisitions;
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•
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Dell Technologies’ ability to refinance such indebtedness or to obtain additional financing for working capital, capital expenditures, acquisitions or other general corporate purposes may be impaired;
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•
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Dell Technologies is exposed to fluctuations in interest rates because Dell Technologies’ senior credit facilities have variable rates of interest;
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Dell Technologies’ leverage may be greater than that of some of its competitors, which may put Dell Technologies at a competitive disadvantage and reduce Dell Technologies’ flexibility in responding to current and changing industry and financial market conditions; and
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Dell Technologies may be unable to comply with financial and other restrictive covenants in its senior credit facilities, the notes, and other indebtedness that limit Dell Technologies’ ability to incur additional debt, make investments and sell assets, which could result in an event of default that, if not cured or waived, would have an adverse effect on Dell Technologies’ business and prospects and could force it into bankruptcy or liquidation.
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•
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fluctuations in demand, adoption rates, sales cycles (which have been increasing in length), and pricing levels for VMware, Inc.’s products and services;
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changes in customers’ budgets for information technology purchases and in the timing of its purchasing decisions;
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the timing of recognizing revenues in any given quarter, which can be affected by a number of factors, including product announcements, beta programs and product promotions that can cause revenue recognition of certain orders to be deferred until future products to which customers are entitled become available;
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the timing of announcements or releases of new or upgraded products and services by VMware, Inc. or by its competitors;
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the timing and size of business realignment plans and restructuring charges;
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VMware, Inc.’s 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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VMware, Inc.’s ability to control costs, including its operating expenses;
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credit risks of VMware, Inc.’s distributors, who account for a significant portion of VMware, Inc.’s product revenues and accounts receivable;
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VMware, Inc.’s ability to process sales at the end of the quarter;
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seasonal factors, such as the end of fiscal period budget expenditures by VMware, Inc.’s customers and the timing of holiday and vacation periods;
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renewal rates and the amounts of the renewals for enterprise agreements, as the original terms of such agreements expire;
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the timing and amount of software development costs that may be capitalized;
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unplanned events that could affect market perception of the quality or cost-effectiveness of VMware, Inc.’s products and solutions; and
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VMware, Inc.’s ability to predict accurately the degree to which customers will elect to purchase its subscription‑based offerings in place of licenses to its on‑premises offerings.
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announcements of new products, services or technologies, commercial relationships, acquisitions or other events by Dell Technologies or its competitors;
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changes in how customers perceive the effectiveness of Dell Technologies’ products, services or technologies;
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actual or anticipated variations in Dell Technologies’ quarterly or annual results of operations;
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changes in Dell Technologies’ financial guidance or estimates by securities analysts;
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price and volume fluctuations in the overall stock market from time to time;
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significant volatility in the market price and trading volume of technology companies in general and of companies in the information technology industry in particular;
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actual or anticipated changes in the expectations of investors or securities analysts;
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fluctuations in the trading volume of the Class C Common Stock or the size of the trading market for the Class C Common Stock held by non-affiliates;
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litigation involving Dell Technologies, its industry, or both, including disputes or other developments relating to Dell Technologies’ ability to obtain patent protection for its processes and technologies and protect its other proprietary rights;
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regulatory developments in the United States and other jurisdictions in which Dell Technologies operates;
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general economic and political factors, including market conditions in Dell Technologies’ industry or the industries of its clients;
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major catastrophic events;
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sales of large blocks of the Class C Common Stock; and
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additions or departures of key employees.
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limitations on who may call special meetings of stockholders;
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advance notice requirements for nominations of candidates for election to the board of directors and for proposals for other businesses;
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the existence of authorized and unissued stock, including “blank check” preferred stock, which could be issued by the board of directors without approval of the holders of the common stock to persons friendly to Dell Technologies’ management, thereby protecting the continuity of Dell Technologies’ management, or which could be used to dilute the stock ownership of persons seeking to obtain control of Dell Technologies;
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the requirement that any stockholder written consent be signed by holders of a majority of Dell Technologies’ common stock beneficially owned by the MD stockholders and holders of a majority of Dell Technologies’ common stock beneficially owned by the SLP stockholders; and
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the requirement that (1) the holders of the Class A Common Stock, voting separately as a series, (2) the holders of the Class B Common Stock, voting separately as a series, and (3) the MD stockholders and SLP stockholders, in each case, so long as they own any common stock, approve amendments to certain provisions of Dell Technologies’ certificate of incorporation, including provisions related to authorized capital stock and the size and structure of the board of directors.
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Dell Technologies have a board that is composed of a majority of “independent directors,” as defined under NYSE rules;
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Dell Technologies have a compensation committee that is composed entirely of independent directors; and
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Dell Technologies have a nominating/corporate governance committee that is composed entirely of independent directors.
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any derivative action or proceeding brought on behalf of Dell Technologies;
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any action asserting a claim of breach of a fiduciary duty owed by any director or officer or stockholder of Dell Technologies to Dell Technologies or Dell Technologies’ stockholders;
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any action asserting a claim against Dell Technologies or any director or officer or stockholder of Dell Technologies arising pursuant to any provision of the Delaware General Corporation Law or of the certificate of incorporation or bylaws of Dell Technologies; or
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any action asserting a claim against Dell Technologies or any director or officer or stockholder of Dell Technologies governed by the internal affairs doctrine.
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Owned
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Leased
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(in millions)
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U.S. facilities
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10.2
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5.5
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International facilities
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4.5
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11.3
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Total (a)
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14.7
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16.8
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(a)
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Includes 2.3 million square feet of subleased or vacant space.
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Class V Common Stock
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S&P 500
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S&P 500 Systems Software Index
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Fiscal Year 2017
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|
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September 7, 2016
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$100.00
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$100.00
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$100.00
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October 28, 2016
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$101.81
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$97.49
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$101.28
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February 3, 2017
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$134.06
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$105.94
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$108.32
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Fiscal Year 2018
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May 5, 2017
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$140.19
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$111.19
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$119.07
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August 4, 2017
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$134.15
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$115.39
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$126.57
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November 3, 2017
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$168.48
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$121.13
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$142.95
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February 2, 2018
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$147.71
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$129.92
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$153.56
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Fiscal Year 2019
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May 4, 2018
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$151.98
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$125.88
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$157.59
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August 3, 2018
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$193.94
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$134.89
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$175.40
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November 2, 2018
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$189.96
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$129.92
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$174.56
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December 27, 2018
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$166.67
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$119.19
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$166.55
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Class C Common Stock
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S&P 500
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|
S&P 500 Systems Software Index
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Fiscal Year 2019
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|
|
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December 28, 2018
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$100.00
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|
$100.00
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$100.00
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February 1, 2019
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$149.65
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|
$108.88
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$104.07
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Fiscal Year Ended
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||||||||||||||||||
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February 1, 2019
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February 2, 2018
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February 3, 2017 (a)
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January 29, 2016 (b)
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January 30, 2015 (b)
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(in millions, except per share data)
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Results of Operations and Cash Flow Data:
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Net revenue
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$
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90,621
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$
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79,040
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$
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62,164
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$
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50,911
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$
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54,142
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Gross margin
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$
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25,053
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$
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20,537
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$
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13,649
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$
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8,387
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|
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$
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8,896
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Operating loss
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$
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(191
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)
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$
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(2,416
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)
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|
$
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(2,390
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)
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$
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(514
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)
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|
$
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(316
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)
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Loss from continuing operations before income taxes
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$
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(2,361
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)
|
|
$
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(4,769
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)
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|
$
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(4,494
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)
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$
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(1,286
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)
|
|
$
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(1,215
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)
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Loss from continuing operations
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$
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(2,181
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)
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$
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(2,926
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)
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$
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(3,074
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)
|
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$
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(1,168
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)
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$
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(1,108
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)
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Earnings (loss) per share attributable to Dell Technologies Inc.:
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||||||||||
Continuing operations - Class V Common Stock - basic
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$
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6.01
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$
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1.63
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$
|
1.36
|
|
|
$
|
—
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|
|
$
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—
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Continuing operations - DHI Group - basic
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$
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(6.02
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)
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$
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(5.61
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)
|
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$
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(7.19
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)
|
|
$
|
(2.88
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)
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|
$
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(2.74
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)
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Continuing operations - Class V Common Stock - diluted
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$
|
5.91
|
|
|
$
|
1.61
|
|
|
$
|
1.35
|
|
|
$
|
—
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|
|
$
|
—
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Continuing operations - DHI Group - diluted
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$
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(6.04
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)
|
|
$
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(5.62
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)
|
|
$
|
(7.19
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)
|
|
$
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(2.88
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)
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|
$
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(2.74
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)
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Number of weighted-average shares outstanding:
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|
|
|
|
|
|
|
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||||||||||
Class V Common Stock - basic
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199
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|
|
203
|
|
|
217
|
|
|
—
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|
|
—
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|
|||||
DHI Group - basic
|
582
|
|
|
567
|
|
|
470
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|
|
405
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|
|
404
|
|
|||||
Class V Common Stock - diluted
|
199
|
|
|
203
|
|
|
217
|
|
|
—
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|
|
—
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|
|||||
DHI Group - diluted
|
582
|
|
|
567
|
|
|
470
|
|
|
405
|
|
|
404
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|||||
Net cash provided by operating activities
|
$
|
6,991
|
|
|
$
|
6,843
|
|
|
$
|
2,367
|
|
|
$
|
2,162
|
|
|
$
|
2,551
|
|
(a)
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The fiscal year ended February 3, 2017 included 53 weeks.
|
(b)
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Results of operations and cash flow data for fiscal years ended January 29, 2016 and January 30, 2015 presented in the table above have not been recast for, and do not reflect the adoption of, the amended guidance on the recognition of revenue from contracts with customers.
|
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
|
January 29, 2016 (a)
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|
January 30, 2015 (a)
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||||||||||
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(in millions)
|
||||||||||||||||||
Balance Sheet Data:
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|
|
|
|
|
|
|||||||||||||
Cash and cash equivalents
|
$
|
9,676
|
|
|
$
|
13,942
|
|
|
$
|
9,474
|
|
|
$
|
6,322
|
|
|
$
|
5,398
|
|
Total assets
|
$
|
111,820
|
|
|
$
|
124,193
|
|
|
$
|
119,672
|
|
|
$
|
45,122
|
|
|
$
|
48,029
|
|
Short-term debt
|
$
|
4,320
|
|
|
$
|
7,873
|
|
|
$
|
6,329
|
|
|
$
|
2,981
|
|
|
$
|
2,920
|
|
Long-term debt
|
$
|
49,201
|
|
|
$
|
43,998
|
|
|
$
|
43,061
|
|
|
$
|
10,650
|
|
|
$
|
11,071
|
|
Total Dell Technologies Inc. stockholders’ equity (deficit)
|
$
|
(5,765
|
)
|
|
$
|
11,719
|
|
|
$
|
14,757
|
|
|
$
|
1,466
|
|
|
$
|
2,904
|
|
(a)
|
Balance sheet data as of January 29, 2016 and January 30, 2015 presented in the table above have not been recast for, and do not reflect the adoption of, the amended guidance on the recognition of revenue from contracts with customers.
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•
|
Infrastructure Solutions Group (“ISG”) — ISG enables the digital transformation of our customers through our trusted multi-cloud and big data solutions, which are built upon a modern data center infrastructure. Our comprehensive portfolio of advanced storage solutions includes traditional storage solutions as well as next-generation storage solutions (such as all-flash arrays, scale-out file, object platforms and software-defined solutions), while our server portfolio includes high-performance rack, blade, tower and hyperscale servers. Our networking portfolio helps our business customers transform and modernize their infrastructure, mobilize and enrich end-user experiences, and accelerate business applications and processes. Our strengths in server, storage, and virtualization software solutions enable us to offer leading converged and hyper-converged solutions, allowing our customers to accelerate their IT transformation by acquiring scalable integrated IT solutions instead of building and assembling their own IT platforms. ISG also offers attached software, peripherals and services, including support and deployment, configuration, and extended warranty services.
|
•
|
Client Solutions Group (“CSG”) — CSG includes branded hardware (such as desktops, workstations, and notebooks) and branded peripherals (such as displays and projectors), as well as third-party software and peripherals. CSG also offers attached software, peripherals, and services, including support and deployment, configuration, and extended warranty services.
|
•
|
VMware — The VMware reportable segment (“VMware”) reflects the operations of VMware, Inc. (NYSE: VMW) within Dell Technologies. See Exhibit 99.1 filed with this report for further details on the differences between VMware reportable segment results and VMware, Inc. results.
|
•
|
Pivotal (NYSE: PVTL) provides a leading cloud-native platform that makes software development and IT operations a strategic advantage for customers. Pivotal’s cloud-native platform, Pivotal Cloud Foundry, accelerates and streamlines software development by reducing the complexity of building, deploying and operating new cloud-native applications and modernizing legacy applications. On April 24, 2018, Pivotal completed a registered underwritten initial public offering of its Class A common stock.
|
•
|
Secureworks (NASDAQ: SCWX) is a leading global provider of intelligence-driven information security solutions singularly focused on protecting its clients from cyber attacks. The solutions offered by Secureworks enable organizations of varying size and complexity to fortify their cyber defenses to prevent security breaches, detect malicious activity in near real time, prioritize and respond rapidly to security incidents and predict emerging threats.
|
•
|
RSA Security provides essential cybersecurity solutions engineered to enable organizations to detect, investigate, and respond to advanced attacks, confirm and manage identities, and, ultimately, help reduce IP theft, fraud, and cybercrime.
|
•
|
Virtustream offers cloud software and infrastructure-as-a-service solutions that enable customers to migrate, run, and manage mission-critical applications in cloud-based IT environments. Beginning in the first quarter of Fiscal 2019, Virtustream results are reported within other businesses, rather than within ISG. This change in reporting structure did not impact our previously reported consolidated financial results, but our prior period segment results have been recast to reflect the change.
|
•
|
Boomi specializes in cloud-based integration, connecting information between existing on-premise and cloud-based applications to ensure business processes are optimized, data is accurate and workflow is reliable.
|
•
|
Amortization of Intangible Assets — Amortization of intangible assets primarily consists of amortization of customer relationships, developed technology, and trade names. In connection with the EMC merger transaction and the acquisition of Dell Inc. by Dell Technologies Inc. on October 29, 2013, referred to as the going-private transaction, all of the tangible and intangible assets and liabilities of EMC and Dell, respectively, were accounted for and recognized at fair value on the transaction dates. Accordingly, for the periods presented, amortization of intangible assets represents amortization associated with intangible assets recognized in connection with the EMC merger transaction and the going-private transaction. Amortization charges for purchased intangible assets are significantly impacted by the timing and magnitude of our acquisitions, and these charges may vary in amount from period to period. We exclude these charges for purposes of calculating the non-GAAP financial measures presented below to facilitate a more meaningful evaluation of our current operating performance and comparisons to our past operating performance.
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•
|
Impact of Purchase Accounting — The impact of purchase accounting includes purchase accounting adjustments, related to the EMC merger transaction and, to a lesser extent, the going-private transaction, recorded under the acquisition method of accounting in accordance with the accounting guidance for business combinations. This guidance prescribes that the purchase price be allocated to assets acquired and liabilities assumed based on the estimated fair value of such assets and liabilities on the date of the transaction. Accordingly, all of the assets and liabilities acquired in the EMC merger transaction and the going-private transaction were accounted for and recognized at fair value as of the respective transaction dates, and the fair value adjustments are being amortized over the estimated useful lives in the periods following the transactions. The fair value adjustments primarily relate to deferred revenue, inventory, and property, plant, and equipment. The purchase accounting adjustments and related amortization of those adjustments are reflected in our GAAP results; however, we evaluate the operating results of the underlying businesses on a non-GAAP basis, after removing such adjustments. We believe that excluding the impact of purchase accounting provides results that are useful in understanding our current operating performance and provides more meaningful comparisons to our past operating performance.
|
•
|
Transaction-related Expenses — Transaction-related expenses consist of acquisition, integration, and divestiture related costs, as well as the costs incurred in the Class V transaction, and are expensed as incurred. These expenses primarily represent costs for legal, banking, consulting, and advisory services, as well as certain compensatory retention awards directly related to the EMC merger transaction. For Fiscal 2019, this category also included charges related to integration of our inventory policies and management process. During Fiscal 2019, we incurred approximately $316 million for the completion of the Class V transaction, expenses of approximately $116 million for customer evaluation units, and approximately $100 million for manufacturing and engineering inventory. During Fiscal 2017, transaction-related expenses included $0.8 billion in day one stock-based compensation charges primarily related to the acceleration of vesting of EMC equity awards and related taxes incurred in connection with the EMC merger transaction.
|
•
|
Other Corporate Expenses — Other corporate expenses consist of goodwill impairment charges, severance, facility action costs, and stock-based compensation expense associated with equity awards. In the third quarter of Fiscal 2019, we incurred a goodwill impairment charge of $190 million. See Note 8 of the Notes to the Consolidated Financial Statements for additional information about goodwill impairment testing. Severance costs are primarily related to severance and benefits for employees terminated pursuant to cost savings initiatives. Facility action costs were $22 million during Fiscal 2019, compared to $205 million during Fiscal 2018. We continue to integrate owned and leased facilities and may incur additional costs as we seek opportunities for operational efficiencies. Other corporate expenses vary from period to period and are significantly impacted by the timing and nature of these events. Therefore, although we may incur these types of expenses in the future, we believe that eliminating these charges for purposes of calculating the non-GAAP financial measures presented below facilitates a more meaningful evaluation of our current operating performance and comparisons to our past operating performance.
|
•
|
Fair Value Adjustments on Equity Investments — Fair value adjustments on equity investments primarily consists of the gain (loss) on strategic investments, which includes the recurring fair value adjustments of investments in publicly-traded companies, as well as those in privately-held companies, which are adjusted for observable price changes, and to a lesser extent any potential impairments. Given the volatility in the ongoing adjustments to the valuation of these strategic investments, we believe that excluding these charges for purposes of calculating non-GAAP net income from continuing operations presented below facilitates a more meaningful evaluation of our current operating performance and comparisons to our past operating performance.
|
•
|
Aggregate Adjustment for Income Taxes — The aggregate adjustment for income taxes is the estimated combined income tax effect for the adjustments described above, as well as an adjustment for discrete tax items. Due to the variability in recognition of discrete tax items from period to period, we believe that excluding these benefits or charges for purposes of calculating non-GAAP net income from continuing operations facilitates a more meaningful evaluation of our current operating performance and comparisons to our past operating performance. The tax effects are determined based on the tax jurisdictions where the above items were incurred.
|
|
Fiscal Year Ended
|
||||||||||||||||
|
February 1,
2019 |
|
% Change
|
|
February 2,
2018 |
|
% Change
|
|
February 3,
2017 |
||||||||
|
(in millions, except percentages)
|
||||||||||||||||
Product net revenue
|
$
|
71,287
|
|
|
16
|
%
|
|
$
|
61,251
|
|
|
20
|
%
|
|
$
|
51,057
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
||||||||
Impact of purchase accounting
|
61
|
|
|
|
|
170
|
|
|
|
|
300
|
|
|||||
Non-GAAP product net revenue
|
$
|
71,348
|
|
|
16
|
%
|
|
$
|
61,421
|
|
|
20
|
%
|
|
$
|
51,357
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Services net revenue
|
$
|
19,334
|
|
|
9
|
%
|
|
$
|
17,789
|
|
|
60
|
%
|
|
$
|
11,107
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
||||||||
Impact of purchase accounting
|
642
|
|
|
|
|
1,099
|
|
|
|
|
852
|
|
|||||
Non-GAAP services net revenue
|
$
|
19,976
|
|
|
6
|
%
|
|
$
|
18,888
|
|
|
58
|
%
|
|
$
|
11,959
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net revenue
|
$
|
90,621
|
|
|
15
|
%
|
|
$
|
79,040
|
|
|
27
|
%
|
|
$
|
62,164
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
||||||||
Impact of purchase accounting
|
703
|
|
|
|
|
1,269
|
|
|
|
|
1,152
|
|
|||||
Non-GAAP net revenue
|
$
|
91,324
|
|
|
14
|
%
|
|
$
|
80,309
|
|
|
27
|
%
|
|
$
|
63,316
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Product gross margin
|
$
|
13,398
|
|
|
36
|
%
|
|
$
|
9,818
|
|
|
28
|
%
|
|
$
|
7,669
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of intangibles
|
2,883
|
|
|
|
|
3,694
|
|
|
|
|
1,652
|
|
|||||
Impact of purchase accounting
|
78
|
|
|
|
|
213
|
|
|
|
|
1,104
|
|
|||||
Transaction-related expenses
|
210
|
|
|
|
|
11
|
|
|
|
|
24
|
|
|||||
Other corporate expenses
|
32
|
|
|
|
|
25
|
|
|
|
|
29
|
|
|||||
Non-GAAP product gross margin
|
$
|
16,601
|
|
|
21
|
%
|
|
$
|
13,761
|
|
|
31
|
%
|
|
$
|
10,478
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Services gross margin
|
$
|
11,655
|
|
|
9
|
%
|
|
$
|
10,719
|
|
|
79
|
%
|
|
$
|
5,980
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of intangibles
|
—
|
|
|
|
|
—
|
|
|
|
|
1
|
|
|||||
Impact of purchase accounting
|
642
|
|
|
|
|
1,099
|
|
|
|
|
875
|
|
|||||
Transaction-related expenses
|
3
|
|
|
|
|
13
|
|
|
|
|
19
|
|
|||||
Other corporate expenses
|
121
|
|
|
|
|
76
|
|
|
|
|
128
|
|
|||||
Non-GAAP services gross margin
|
$
|
12,421
|
|
|
4
|
%
|
|
$
|
11,907
|
|
|
70
|
%
|
|
$
|
7,003
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Gross margin
|
$
|
25,053
|
|
|
22
|
%
|
|
$
|
20,537
|
|
|
50
|
%
|
|
$
|
13,649
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of intangibles
|
2,883
|
|
|
|
|
3,694
|
|
|
|
|
1,653
|
|
|||||
Impact of purchase accounting
|
720
|
|
|
|
|
1,312
|
|
|
|
|
1,979
|
|
|||||
Transaction-related expenses
|
213
|
|
|
|
|
24
|
|
|
|
|
43
|
|
|||||
Other corporate expenses
|
153
|
|
|
|
|
101
|
|
|
|
|
157
|
|
|||||
Non-GAAP gross margin
|
$
|
29,022
|
|
|
13
|
%
|
|
$
|
25,668
|
|
|
47
|
%
|
|
$
|
17,481
|
|
|
Fiscal Year Ended
|
||||||||||||||||
|
February 1,
2019 |
|
% Change
|
|
February 2,
2018 |
|
% Change
|
|
February 3,
2017 |
||||||||
|
(in millions, except percentages)
|
||||||||||||||||
Operating expenses
|
$
|
25,244
|
|
|
10
|
%
|
|
$
|
22,953
|
|
|
43
|
%
|
|
$
|
16,039
|
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of intangibles
|
(3,255
|
)
|
|
|
|
(3,286
|
)
|
|
|
|
(2,028
|
)
|
|||||
Impact of purchase accounting
|
(100
|
)
|
|
|
|
(234
|
)
|
|
|
|
(287
|
)
|
|||||
Transaction-related expenses
|
(537
|
)
|
|
|
|
(478
|
)
|
|
|
|
(1,445
|
)
|
|||||
Other corporate expenses
|
(1,184
|
)
|
|
|
|
(1,059
|
)
|
|
|
|
(745
|
)
|
|||||
Non-GAAP operating expenses
|
$
|
20,168
|
|
|
13
|
%
|
|
$
|
17,896
|
|
|
55
|
%
|
|
$
|
11,534
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating loss
|
$
|
(191
|
)
|
|
92
|
%
|
|
$
|
(2,416
|
)
|
|
(1
|
)%
|
|
$
|
(2,390
|
)
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of intangibles
|
6,138
|
|
|
|
|
6,980
|
|
|
|
|
3,681
|
|
|||||
Impact of purchase accounting
|
820
|
|
|
|
|
1,546
|
|
|
|
|
2,266
|
|
|||||
Transaction-related expenses
|
750
|
|
|
|
|
502
|
|
|
|
|
1,488
|
|
|||||
Other corporate expenses
|
1,337
|
|
|
|
|
1,160
|
|
|
|
|
902
|
|
|||||
Non-GAAP operating income
|
$
|
8,854
|
|
|
14
|
%
|
|
$
|
7,772
|
|
|
31
|
%
|
|
$
|
5,947
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net loss from continuing operations
|
$
|
(2,181
|
)
|
|
25
|
%
|
|
$
|
(2,926
|
)
|
|
5
|
%
|
|
$
|
(3,074
|
)
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
||||||||
Amortization of intangibles
|
6,138
|
|
|
|
|
6,980
|
|
|
|
|
3,681
|
|
|||||
Impact of purchase accounting
|
820
|
|
|
|
|
1,546
|
|
|
|
|
2,266
|
|
|||||
Transaction-related expenses
|
824
|
|
|
|
|
502
|
|
|
|
|
1,485
|
|
|||||
Other corporate expenses
|
1,337
|
|
|
|
|
1,160
|
|
|
|
|
902
|
|
|||||
Fair value adjustments on equity investments
|
(342
|
)
|
|
|
|
(72
|
)
|
|
|
|
(4
|
)
|
|||||
Aggregate adjustment for income taxes
|
(1,369
|
)
|
|
|
|
(2,835
|
)
|
|
|
|
(2,158
|
)
|
|||||
Non-GAAP net income from continuing operations (a)
|
$
|
5,227
|
|
|
20
|
%
|
|
$
|
4,355
|
|
|
41
|
%
|
|
$
|
3,098
|
|
|
Fiscal Year Ended
|
||||||||||||||||
|
February 1,
2019 |
|
% Change
|
|
February 2,
2018 |
|
% Change
|
|
February 3,
2017 |
||||||||
|
(in millions, except percentages)
|
||||||||||||||||
Net loss from continuing operations
|
$
|
(2,181
|
)
|
|
25
|
%
|
|
$
|
(2,926
|
)
|
|
5
|
%
|
|
$
|
(3,074
|
)
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
||||||||
Interest and other, net (a)
|
2,170
|
|
|
|
|
2,353
|
|
|
|
|
2,104
|
|
|||||
Income tax benefit
|
(180
|
)
|
|
|
|
(1,843
|
)
|
|
|
|
(1,420
|
)
|
|||||
Depreciation and amortization
|
7,746
|
|
|
|
|
8,634
|
|
|
|
|
4,840
|
|
|||||
EBITDA
|
$
|
7,555
|
|
|
22
|
%
|
|
$
|
6,218
|
|
|
154
|
%
|
|
$
|
2,450
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
EBITDA
|
$
|
7,555
|
|
|
22
|
%
|
|
$
|
6,218
|
|
|
154
|
%
|
|
$
|
2,450
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
||||||||
Stock-based compensation expense
|
918
|
|
|
|
|
835
|
|
|
|
|
392
|
|
|||||
Impact of purchase accounting (b)
|
704
|
|
|
|
|
1,274
|
|
|
|
|
1,898
|
|
|||||
Transaction-related expenses (c)
|
722
|
|
|
|
|
502
|
|
|
|
|
1,525
|
|
|||||
Other corporate expenses (d)
|
397
|
|
|
|
|
305
|
|
|
|
|
510
|
|
|||||
Adjusted EBITDA
|
$
|
10,296
|
|
|
13
|
%
|
|
$
|
9,134
|
|
|
35
|
%
|
|
$
|
6,775
|
|
(a)
|
See “Results of Operations — Interest and Other, Net” for more information on the components of interest and other, net.
|
(b)
|
This amount includes the non-cash purchase accounting adjustments related to the EMC merger transaction and the going-private transaction.
|
(c)
|
Transaction-related expenses consist of acquisition, integration, and divestiture related costs, as well as the costs incurred in the Class V transaction.
|
(d)
|
Consists of goodwill impairment charges, severance, and facility action costs.
|
|
Fiscal Year Ended
|
|||||||||||||||||||||||||
|
February 1, 2019
|
|
|
|
February 2, 2018
|
|
|
|
February 3, 2017
|
|||||||||||||||||
|
Dollars
|
|
% of
Net Revenue |
|
%
Change |
|
Dollars
|
|
% of
Net Revenue |
|
%
Change |
|
Dollars
|
|
% of
Net Revenue |
|||||||||||
|
(in millions, except percentages)
|
|||||||||||||||||||||||||
Net revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Product
|
$
|
71,287
|
|
|
78.7
|
%
|
|
16
|
%
|
|
$
|
61,251
|
|
|
77.5
|
%
|
|
20
|
%
|
|
$
|
51,057
|
|
|
82.1
|
%
|
Services
|
19,334
|
|
|
21.3
|
%
|
|
9
|
%
|
|
17,789
|
|
|
22.5
|
%
|
|
60
|
%
|
|
11,107
|
|
|
17.9
|
%
|
|||
Total net revenue
|
$
|
90,621
|
|
|
100.0
|
%
|
|
15
|
%
|
|
$
|
79,040
|
|
|
100.0
|
%
|
|
27
|
%
|
|
$
|
62,164
|
|
|
100.0
|
%
|
Gross margin:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Product (a)
|
$
|
13,398
|
|
|
18.8
|
%
|
|
36
|
%
|
|
$
|
9,818
|
|
|
16.0
|
%
|
|
28
|
%
|
|
$
|
7,669
|
|
|
15.0
|
%
|
Services (b)
|
11,655
|
|
|
60.3
|
%
|
|
9
|
%
|
|
10,719
|
|
|
60.3
|
%
|
|
79
|
%
|
|
5,980
|
|
|
53.8
|
%
|
|||
Total gross margin
|
$
|
25,053
|
|
|
27.6
|
%
|
|
22
|
%
|
|
$
|
20,537
|
|
|
26.0
|
%
|
|
50
|
%
|
|
$
|
13,649
|
|
|
22.0
|
%
|
Operating expenses
|
$
|
25,244
|
|
|
27.8
|
%
|
|
10
|
%
|
|
$
|
22,953
|
|
|
29.0
|
%
|
|
43
|
%
|
|
$
|
16,039
|
|
|
25.8
|
%
|
Operating loss
|
$
|
(191
|
)
|
|
(0.2
|
)%
|
|
92
|
%
|
|
$
|
(2,416
|
)
|
|
(3.1
|
)%
|
|
(1
|
)%
|
|
$
|
(2,390
|
)
|
|
(3.8
|
)%
|
Net loss from continuing operations
|
$
|
(2,181
|
)
|
|
(2.4
|
)%
|
|
25
|
%
|
|
$
|
(2,926
|
)
|
|
(3.7
|
)%
|
|
5
|
%
|
|
$
|
(3,074
|
)
|
|
(4.9
|
)%
|
Net loss attributable to Dell Technologies Inc.
|
$
|
(2,310
|
)
|
|
(2.5
|
)%
|
|
19
|
%
|
|
$
|
(2,849
|
)
|
|
(3.6
|
)%
|
|
(144
|
)%
|
|
$
|
(1,167
|
)
|
|
(1.9
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Non-GAAP Financial Information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Non-GAAP net revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Product
|
$
|
71,348
|
|
|
78.1
|
%
|
|
16
|
%
|
|
$
|
61,421
|
|
|
76.5
|
%
|
|
20
|
%
|
|
$
|
51,357
|
|
|
81.1
|
%
|
Services
|
19,976
|
|
|
21.9
|
%
|
|
6
|
%
|
|
18,888
|
|
|
23.5
|
%
|
|
58
|
%
|
|
11,959
|
|
|
18.9
|
%
|
|||
Total non-GAAP net revenue
|
$
|
91,324
|
|
|
100.0
|
%
|
|
14
|
%
|
|
$
|
80,309
|
|
|
100.0
|
%
|
|
27
|
%
|
|
$
|
63,316
|
|
|
100.0
|
%
|
Non-GAAP gross margin:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Product (a)
|
$
|
16,601
|
|
|
23.3
|
%
|
|
21
|
%
|
|
$
|
13,761
|
|
|
22.4
|
%
|
|
31
|
%
|
|
$
|
10,478
|
|
|
20.4
|
%
|
Services (b)
|
12,421
|
|
|
62.2
|
%
|
|
4
|
%
|
|
11,907
|
|
|
63.0
|
%
|
|
70
|
%
|
|
7,003
|
|
|
58.6
|
%
|
|||
Total non-GAAP gross margin
|
$
|
29,022
|
|
|
31.8
|
%
|
|
13
|
%
|
|
$
|
25,668
|
|
|
32.0
|
%
|
|
47
|
%
|
|
$
|
17,481
|
|
|
27.6
|
%
|
Non-GAAP operating expenses
|
$
|
20,168
|
|
|
22.1
|
%
|
|
13
|
%
|
|
$
|
17,896
|
|
|
22.3
|
%
|
|
55
|
%
|
|
$
|
11,534
|
|
|
18.2
|
%
|
Non-GAAP operating income
|
$
|
8,854
|
|
|
9.7
|
%
|
|
14
|
%
|
|
$
|
7,772
|
|
|
9.7
|
%
|
|
31
|
%
|
|
$
|
5,947
|
|
|
9.4
|
%
|
Non-GAAP net income from continuing operations (c)
|
$
|
5,227
|
|
|
5.7
|
%
|
|
20
|
%
|
|
$
|
4,355
|
|
|
5.4
|
%
|
|
41
|
%
|
|
$
|
3,098
|
|
|
4.9
|
%
|
EBITDA
|
$
|
7,555
|
|
|
8.3
|
%
|
|
22
|
%
|
|
$
|
6,218
|
|
|
7.7
|
%
|
|
154
|
%
|
|
$
|
2,450
|
|
|
3.9
|
%
|
Adjusted EBITDA
|
$
|
10,296
|
|
|
11.3
|
%
|
|
13
|
%
|
|
$
|
9,134
|
|
|
11.4
|
%
|
|
35
|
%
|
|
$
|
6,775
|
|
|
10.7
|
%
|
(a)
|
Product gross margin percentages represent product gross margin as a percentage of product net revenue, and non-GAAP product gross margin percentages represent non-GAAP product gross margin as a percentage of non-GAAP product net revenue.
|
(b)
|
Services gross margin percentages represent services gross margin as a percentage of services net revenue, and non-GAAP services gross margin percentages represent non-GAAP services gross margin as a percentage of non-GAAP services net revenue.
|
(c)
|
Non-GAAP net income from continuing operations has been recast to exclude fair value adjustments on equity investments, the corresponding tax effects of those adjustments, and discrete tax items.
|
•
|
Product Net Revenue — Product net revenue includes revenue from the sale of hardware products and software licenses. During Fiscal 2019, both product net revenue and non-GAAP product net revenue increased 16%. These increases were attributable to an increase in product revenue across all three business units, driven by strength in sales across all product categories.
|
•
|
Services Net Revenue — Services net revenue includes revenue from our services offerings and support services related to hardware products and software licenses. During Fiscal 2019, services net revenue and non-GAAP services net revenue increased 9% and 6%, respectively. These increases were primarily due to an increase in services revenue for hardware support and deployment and software maintenance due to growth in the business. A portion of services net revenue is derived from offerings that have been deferred over a period of time, and, as a result, reported services net revenue growth rates will be different than product net revenue growth rates.
|
•
|
Product Net Revenue — During Fiscal 2018, product net revenue and non-GAAP product net revenue both increased 20%, primarily due to the incremental product net revenue from the EMC acquired businesses and, to a lesser extent, an increase in CSG product net revenue. The increases in product net revenue and non-GAAP product net revenue during Fiscal 2018 were driven by strength in sales of notebooks, workstations, servers, and VMware license revenue.
|
•
|
Services Net Revenue — During Fiscal 2018, services net revenue and non-GAAP services net revenue increased 60% and 58%, respectively. These increases were primarily due to the incremental services net revenue from the EMC acquired businesses.
|
•
|
Products — During Fiscal 2019, product gross margin increased 36% to $13.4 billion, and product gross margin percentage increased 280 basis points to 18.8%. The increases in both product gross margin and product gross margin percentage were primarily attributable to a decrease in amortization of intangibles and purchase accounting adjustments. During Fiscal 2019, non-GAAP product gross margin increased 21% to $16.6 billion, and non-GAAP product gross margin percentage increased 90 basis points to 23.3%. The increases in product gross margin and non-GAAP product gross margin were driven primarily by increases in product revenue in all three business units due to strength in sales of ISG servers and storage, CSG commercial products, and VMware software licenses. Product gross margin percentage and non-GAAP product gross margin percentage increased primarily as a result of higher product gross margin percentages for ISG and VMware.
|
•
|
Services — During Fiscal 2019, services gross margin increased 9% to $11.7 billion, and services gross margin percentage was consistent at 60.3%. Services gross margin increased due to growth in services gross margin in CSG and VMware, particularly in hardware support and deployment and software maintenance. During Fiscal 2019 and Fiscal 2018, services gross margin also benefited from a decrease in purchase accounting adjustments, which totaled $0.6 billion and $1.1 billion, respectively. Excluding these costs, transaction-related expenses, and other corporate expenses, non-GAAP services gross margin increased 4% to $12.4 billion, and non-GAAP services gross margin percentage decreased 80 basis points to 62.2%. Services gross margin percentage decreased primarily due to lower services gross margin percentages in all three business units.
|
•
|
Products — During Fiscal 2018, product gross margin increased 28% to $9.8 billion, and product gross margin percentage increased 100 basis points to 16.0%. These increases in product gross margin and product gross margin percentage were driven primarily by additional product gross margin from the EMC acquired businesses, which was partially offset by an increase in amortization of intangibles related to the EMC merger transaction, and to a lesser extent, component cost pressures in CSG and ISG.
|
•
|
Services — During Fiscal 2018, services gross margin increased 79% to 10.7 billion, and services gross margin percentage increased 650 basis points to 60.3%. During Fiscal 2018, non-GAAP services gross margin increased 70% to $11.9 billion, and non-GAAP services gross margin percentage increased 440 basis points to 63.0%. These increases were primarily attributable to the incremental services gross margin from the EMC acquired businesses.
|
|
Fiscal Year Ended
|
|||||||||||||||||||||||||
|
February 1, 2019
|
|
|
|
February 2, 2018
|
|
|
|
February 3, 2017
|
|||||||||||||||||
|
Dollars
|
|
% of
Net Revenue |
|
%
Change |
|
Dollars
|
|
% of
Net Revenue |
|
%
Change |
|
Dollars
|
|
% of
Net Revenue |
|||||||||||
|
(in millions, except percentages)
|
|||||||||||||||||||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Selling, general, and administrative
|
$
|
20,640
|
|
|
22.7
|
%
|
|
11
|
%
|
|
$
|
18,569
|
|
|
23.6
|
%
|
|
39
|
%
|
|
$
|
13,403
|
|
|
21.6
|
%
|
Research and development
|
4,604
|
|
|
5.1
|
%
|
|
5
|
%
|
|
4,384
|
|
|
5.5
|
%
|
|
66
|
%
|
|
2,636
|
|
|
4.2
|
%
|
|||
Total operating expenses
|
$
|
25,244
|
|
|
27.8
|
%
|
|
10
|
%
|
|
$
|
22,953
|
|
|
29.1
|
%
|
|
43
|
%
|
|
$
|
16,039
|
|
|
25.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Other Financial Information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Non-GAAP operating expenses
|
$
|
20,168
|
|
|
22.1
|
%
|
|
13
|
%
|
|
$
|
17,896
|
|
|
22.3
|
%
|
|
55
|
%
|
|
$
|
11,534
|
|
|
18.2
|
%
|
•
|
Selling, General, and Administrative — Selling, general, and administrative (“SG&A”) expenses increased 11% during Fiscal 2019. The increases in SG&A expenses were primarily driven by investments in our go-to-market capabilities, including sales headcount, and higher performance-based compensation and commission costs, as well as a goodwill impairment charge of approximately $190 million recorded during the third quarter of Fiscal 2019.
|
•
|
Research and Development — Research and development (“R&D”) expenses are primarily composed of personnel-related expenses related to product development. R&D expenses as a percentage of net revenue for Fiscal 2019 and Fiscal 2018 were approximately 5.1% and 5.5%, respectively. The decreases in R&D expenses as a percentage of net revenue were attributable to revenue growth that outpaced the scale of R&D investments. As our industry continues to change and as the needs of our customers evolve, we intend to support R&D initiatives to innovate and introduce new and enhanced solutions into the market.
|
•
|
Selling, General, and Administrative — SG&A expenses increased 39% during Fiscal 2018. The increases in SG&A expenses were primarily driven by incremental operating costs of the EMC acquired businesses.
|
•
|
Research and Development — R&D expenses as a percentage of net revenue for Fiscal 2018 and Fiscal 2017 were approximately 5.5% and 4.2%, respectively. The increase in R&D expenses was attributable to the expansion of our R&D capability through the EMC merger transaction.
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Interest and other, net:
|
|
|
|
|
|
|
|
||||
Investment income, primarily interest
|
$
|
313
|
|
|
$
|
207
|
|
|
$
|
102
|
|
Gain (loss) on investments, net
|
342
|
|
|
72
|
|
|
4
|
|
|||
Interest expense
|
(2,488
|
)
|
|
(2,406
|
)
|
|
(1,751
|
)
|
|||
Foreign exchange
|
(206
|
)
|
|
(113
|
)
|
|
(77
|
)
|
|||
Debt extinguishment
|
—
|
|
|
—
|
|
|
(337
|
)
|
|||
Other
|
(131
|
)
|
|
(113
|
)
|
|
(45
|
)
|
|||
Total interest and other, net
|
$
|
(2,170
|
)
|
|
$
|
(2,353
|
)
|
|
$
|
(2,104
|
)
|
|
Fiscal Year Ended
|
||||||||||||||||
|
February 1, 2019
|
|
% Change
|
|
February 2, 2018
|
|
% Change
|
|
February 3, 2017
|
||||||||
|
(in millions, except percentages)
|
||||||||||||||||
Net revenue:
|
|
|
|
|
|
|
|
|
|
||||||||
Servers and networking
|
$
|
19,953
|
|
|
28
|
%
|
|
$
|
15,533
|
|
|
20
|
%
|
|
$
|
12,973
|
|
Storage
|
16,767
|
|
|
9
|
%
|
|
15,384
|
|
|
69
|
%
|
|
9,097
|
|
|||
Total ISG net revenue
|
$
|
36,720
|
|
|
19
|
%
|
|
$
|
30,917
|
|
|
40
|
%
|
|
$
|
22,070
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating income:
|
|
|
|
|
|
|
|
|
|
||||||||
ISG operating income
|
$
|
4,151
|
|
|
35
|
%
|
|
$
|
3,068
|
|
|
5
|
%
|
|
$
|
2,920
|
|
% of segment net revenue
|
11.3
|
%
|
|
|
|
9.9
|
%
|
|
|
|
13.2
|
%
|
|
Fiscal Year Ended
|
||||||||||||||||
|
February 1, 2019
|
|
% Change
|
|
February 2, 2018
|
|
% Change
|
|
February 3, 2017
|
||||||||
|
(in millions, except percentages)
|
||||||||||||||||
Net revenue:
|
|
|
|
|
|
|
|
|
|
||||||||
Commercial
|
$
|
30,893
|
|
|
12
|
%
|
|
$
|
27,507
|
|
|
7
|
%
|
|
$
|
25,773
|
|
Consumer
|
12,303
|
|
|
5
|
%
|
|
11,711
|
|
|
9
|
%
|
|
10,736
|
|
|||
Total CSG net revenue
|
$
|
43,196
|
|
|
10
|
%
|
|
$
|
39,218
|
|
|
7
|
%
|
|
$
|
36,509
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating income:
|
|
|
|
|
|
|
|
|
|
||||||||
CSG operating income
|
$
|
1,960
|
|
|
(4
|
)%
|
|
$
|
2,044
|
|
|
17
|
%
|
|
$
|
1,751
|
|
% of segment net revenue
|
4.5
|
%
|
|
|
|
5.2
|
%
|
|
|
|
4.8
|
%
|
|
Fiscal Year Ended
|
||||||||||||||||
|
February 1, 2019
|
|
% Change
|
|
February 2, 2018
|
|
% Change
|
|
February 3, 2017
|
||||||||
|
(in millions, except percentages)
|
||||||||||||||||
Net revenue:
|
|
|
|
|
|
|
|
|
|
||||||||
VMware net revenue
|
$
|
9,088
|
|
|
14
|
%
|
|
$
|
7,994
|
|
|
126
|
%
|
|
$
|
3,543
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating income:
|
|
|
|
|
|
|
|
|
|
||||||||
VMware operating income
|
$
|
2,989
|
|
|
6
|
%
|
|
$
|
2,809
|
|
|
85
|
%
|
|
$
|
1,516
|
|
% of segment net revenue
|
32.9
|
%
|
|
|
|
35.1
|
%
|
|
|
|
42.8
|
%
|
|
February 1, 2019
|
|
February 2, 2018
|
||||
|
(in millions)
|
||||||
Cash and cash equivalents, and available borrowings:
|
|
|
|
||||
Cash and cash equivalents (a)
|
$
|
9,676
|
|
|
$
|
13,942
|
|
Remaining available borrowings under revolving credit facilities
|
5,586
|
|
|
4,875
|
|
||
Total cash, cash equivalents, and available borrowings
|
$
|
15,262
|
|
|
$
|
18,817
|
|
(a)
|
Of the $9.7 billion of cash and cash equivalents as of February 1, 2019, $2.8 billion was held by VMware, Inc.
|
|
February 1, 2019
|
|
February 2, 2018
|
||||
|
(in millions)
|
||||||
Restricted Subsidiary Debt
|
|
|
|
||||
Core debt:
|
|
|
|
||||
Senior Secured Credit Facilities and First Lien Notes
|
$
|
32,720
|
|
|
$
|
30,595
|
|
Unsecured Notes and Debentures
|
1,952
|
|
|
2,452
|
|
||
Senior Notes
|
3,250
|
|
|
3,250
|
|
||
EMC Notes
|
3,000
|
|
|
5,500
|
|
||
DFS allocated debt
|
(1,615
|
)
|
|
(1,892
|
)
|
||
Total core debt
|
39,307
|
|
|
39,905
|
|
||
DFS related debt:
|
|
|
|
||||
DFS debt
|
5,929
|
|
|
4,796
|
|
||
DFS allocated debt
|
1,615
|
|
|
1,892
|
|
||
Total DFS related debt
|
7,544
|
|
|
6,688
|
|
||
Margin Loan and Other
|
3,388
|
|
|
2,054
|
|
||
Unrestricted Subsidiary Debt
|
|
|
|
||||
VMware Notes
|
4,000
|
|
|
4,000
|
|
||
Other
|
—
|
|
|
47
|
|
||
Total unrestricted subsidiary debt
|
4,000
|
|
|
4,047
|
|
||
Total debt, principal amount
|
54,239
|
|
|
52,694
|
|
||
Carrying value adjustments
|
(718
|
)
|
|
(823
|
)
|
||
Total debt, carrying value
|
$
|
53,521
|
|
|
$
|
51,871
|
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Net change in cash from:
|
|
|
|
|
|
||||||
Operating activities
|
$
|
6,991
|
|
|
$
|
6,843
|
|
|
$
|
2,367
|
|
Investing activities
|
3,389
|
|
|
(2,875
|
)
|
|
(31,236
|
)
|
|||
Financing activities
|
(14,329
|
)
|
|
403
|
|
|
31,785
|
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(189
|
)
|
|
175
|
|
|
24
|
|
|||
Change in cash and cash equivalents
|
$
|
(4,138
|
)
|
|
$
|
4,546
|
|
|
$
|
2,940
|
|
|
|
|
Payments Due by Fiscal Year
|
||||||||||||||||
|
Total
|
|
2020
|
|
2021-2022
|
|
2023-2024
|
|
Thereafter
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Contractual cash obligations:
|
|
|
|
|
|
|
|
|
|
||||||||||
Principal payments on long-term debt
|
$
|
54,239
|
|
|
$
|
10,086
|
|
|
$
|
16,394
|
|
|
$
|
15,931
|
|
|
$
|
11,828
|
|
Operating leases
|
1,856
|
|
|
371
|
|
|
554
|
|
|
288
|
|
|
643
|
|
|||||
Purchase obligations
|
4,605
|
|
|
3,953
|
|
|
627
|
|
|
21
|
|
|
4
|
|
|||||
Interest
|
15,362
|
|
|
2,236
|
|
|
3,695
|
|
|
2,374
|
|
|
7,057
|
|
|||||
Tax obligations
|
202
|
|
|
19
|
|
|
39
|
|
|
84
|
|
|
60
|
|
|||||
Contractual cash obligations
|
$
|
76,264
|
|
|
$
|
16,665
|
|
|
$
|
21,309
|
|
|
$
|
18,698
|
|
|
$
|
19,592
|
|
(1)
|
Identify the contract with a customer. The term “contract” refers to the enforceable rights and obligations provided in an agreement between us and the customer in exchange for payment. We evaluate facts and circumstances regarding sales transactions in order to identify contracts with our customers. An agreement must meet all of the following criteria to qualify as a contract eligible for revenue recognition under the model: (i) the contract must be approved by all parties who are committed to perform their respective obligations; (ii) each party’s rights regarding the goods and services to be transferred to the customer can be identified; (iii) the payment terms for the goods and services can be identified; (iv) the customer has the ability and intent to pay and it is probable that we will collect substantially all of the consideration to which it will be entitled; and (v) the contract must have commercial substance. Judgment is used in determining the customer’s ability and intent to pay, which is based upon various factors including the customer’s historical payment experience or customer credit and financial information.
|
(2)
|
Identify the performance obligations in the contract. Our contracts with customers often include the promise to transfer multiple goods and services to a customer. Distinct promises within a contract are referred to as “performance obligations” and are accounted for as separate units of account. We assess whether each promised good or service is distinct for the purpose of identifying the performance obligations in the contract. This assessment involves subjective determinations and requires management to make judgments about the individual promised goods or services and whether such goods or services are separable from the other aspects of the contractual relationship. Promised goods and services are considered distinct provided that: (i) the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (that is, the good or service is capable of being distinct); and (ii) our promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (that is, the promise to transfer the good or service is distinct within the context of the contract). Our performance obligations include various distinct goods and services such as hardware, software licenses, warranties, and other service offerings and solutions. Promised goods and services are explicitly identified in our contracts and may be sold on a standalone basis or bundled as part of a combined solution. In certain hardware solutions, the hardware is highly interdependent on, and interrelated with the embedded software. In these offerings, the hardware and software licenses are accounted for as a single performance obligation.
|
(3)
|
Determine the transaction price. The transaction price reflects the amount of consideration to which we expect to be entitled in exchange for transferring goods or services to the customer. If the consideration promised in a contract includes a variable amount, we estimate the amount to which we expect to be entitled using either the expected value or most likely amount method. Generally, volume discounts, rebates, and sales returns reduce the transaction price. When we determine the transaction price, we only include amounts that are not subject to significant future reversal.
|
(4)
|
Allocate the transaction price to performance obligations in the contract. When a contract includes multiple performance obligations, the transaction price is allocated to each performance obligation in an amount that depicts the consideration to which we expect to be entitled in exchange for transferring the promised goods or services. For contracts with multiple performance obligations, the transaction price is allocated in proportion to the standalone selling price (“SSP”) of each performance obligation.
|
(5)
|
Recognize revenue when (or as) the performance obligation is satisfied. Revenue is recognized when obligations under the terms of the contract with our customer are satisfied. Revenue is recognized either over time or at a point in time, depending on when the underlying products or services are transferred to the customer. Revenue is recognized at a point in time for products upon transfer of control. Revenue is recognized over time for support and deployment services, software support, SaaS, and IaaS. Revenue is recognized either over time or at a point in time for professional services and training depending on the nature of the offering to the customer.
|
•
|
We do not account for significant financing components if the period between revenue recognition and when the customer pays for the product or service will be one year or less.
|
•
|
We recognize revenue equal to the amount we have a right to invoice when the amount corresponds directly with the value to the customer of our performance to date.
|
•
|
We do not account for shipping and handling activities as a separate performance obligation, but rather as an activity performed to transfer the promised good.
|
|
Page
|
|
February 1, 2019
|
|
February 2, 2018
|
||||
ASSETS
|
|||||||
Current assets:
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
9,676
|
|
|
$
|
13,942
|
|
Short-term investments
|
—
|
|
|
2,187
|
|
||
Accounts receivable, net
|
12,371
|
|
|
11,721
|
|
||
Short-term financing receivables, net
|
4,398
|
|
|
3,919
|
|
||
Inventories, net
|
3,649
|
|
|
2,678
|
|
||
Other current assets
|
6,044
|
|
|
5,881
|
|
||
Total current assets
|
36,138
|
|
|
40,328
|
|
||
Property, plant, and equipment, net
|
5,259
|
|
|
5,390
|
|
||
Long-term investments
|
1,005
|
|
|
4,163
|
|
||
Long-term financing receivables, net
|
4,224
|
|
|
3,724
|
|
||
Goodwill
|
40,089
|
|
|
39,920
|
|
||
Intangible assets, net
|
22,270
|
|
|
28,265
|
|
||
Other non-current assets
|
2,835
|
|
|
2,403
|
|
||
Total assets
|
$
|
111,820
|
|
|
$
|
124,193
|
|
LIABILITIES, REDEEMABLE SHARES, AND STOCKHOLDERS’ EQUITY (DEFICIT)
|
|||||||
Current liabilities:
|
|
|
|
|
|
||
Short-term debt
|
$
|
4,320
|
|
|
$
|
7,873
|
|
Accounts payable
|
19,213
|
|
|
18,334
|
|
||
Accrued and other
|
8,495
|
|
|
8,026
|
|
||
Short-term deferred revenue
|
12,944
|
|
|
11,606
|
|
||
Total current liabilities
|
44,972
|
|
|
45,839
|
|
||
Long-term debt
|
49,201
|
|
|
43,998
|
|
||
Long-term deferred revenue
|
11,066
|
|
|
9,210
|
|
||
Other non-current liabilities
|
6,327
|
|
|
7,277
|
|
||
Total liabilities
|
111,566
|
|
|
106,324
|
|
||
Commitments and contingencies (Note 10)
|
|
|
|
|
|
||
Redeemable shares (Note 17)
|
1,196
|
|
|
384
|
|
||
Stockholders’ equity (deficit):
|
|
|
|
||||
Common stock and capital in excess of $0.01 par value (Note 14)
|
16,114
|
|
|
19,889
|
|
||
Treasury stock at cost
|
(63
|
)
|
|
(1,440
|
)
|
||
Accumulated deficit
|
(21,349
|
)
|
|
(6,860
|
)
|
||
Accumulated other comprehensive income (loss)
|
(467
|
)
|
|
130
|
|
||
Total Dell Technologies Inc. stockholders’ equity (deficit)
|
(5,765
|
)
|
|
11,719
|
|
||
Non-controlling interests
|
4,823
|
|
|
5,766
|
|
||
Total stockholders’ equity (deficit)
|
(942
|
)
|
|
17,485
|
|
||
Total liabilities, redeemable shares, and stockholders’ equity (deficit)
|
$
|
111,820
|
|
|
$
|
124,193
|
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
Net revenue:
|
|
|
|
|
|
|
|||||
Products
|
$
|
71,287
|
|
|
$
|
61,251
|
|
|
$
|
51,057
|
|
Services
|
19,334
|
|
|
17,789
|
|
|
11,107
|
|
|||
Total net revenue
|
90,621
|
|
|
79,040
|
|
|
62,164
|
|
|||
Cost of net revenue:
|
|
|
|
|
|
||||||
Products
|
57,889
|
|
|
51,433
|
|
|
43,388
|
|
|||
Services
|
7,679
|
|
|
7,070
|
|
|
5,127
|
|
|||
Total cost of net revenue
|
65,568
|
|
|
58,503
|
|
|
48,515
|
|
|||
Gross margin
|
25,053
|
|
|
20,537
|
|
|
13,649
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Selling, general, and administrative
|
20,640
|
|
|
18,569
|
|
|
13,403
|
|
|||
Research and development
|
4,604
|
|
|
4,384
|
|
|
2,636
|
|
|||
Total operating expenses
|
25,244
|
|
|
22,953
|
|
|
16,039
|
|
|||
Operating loss
|
(191
|
)
|
|
(2,416
|
)
|
|
(2,390
|
)
|
|||
Interest and other, net
|
(2,170
|
)
|
|
(2,353
|
)
|
|
(2,104
|
)
|
|||
Loss from continuing operations before income taxes
|
(2,361
|
)
|
|
(4,769
|
)
|
|
(4,494
|
)
|
|||
Income tax benefit
|
(180
|
)
|
|
(1,843
|
)
|
|
(1,420
|
)
|
|||
Net loss from continuing operations
|
(2,181
|
)
|
|
(2,926
|
)
|
|
(3,074
|
)
|
|||
Net income from discontinued operations
|
—
|
|
|
—
|
|
|
1,916
|
|
|||
Net loss
|
(2,181
|
)
|
|
(2,926
|
)
|
|
(1,158
|
)
|
|||
Less: Net income (loss) attributable to non-controlling interests
|
129
|
|
|
(77
|
)
|
|
9
|
|
|||
Net loss attributable to Dell Technologies Inc.
|
$
|
(2,310
|
)
|
|
$
|
(2,849
|
)
|
|
$
|
(1,167
|
)
|
|
|
|
|
|
|
||||||
Earnings (loss) per share attributable to Dell Technologies Inc. - basic:
|
|
|
|||||||||
Continuing operations - Class V Common Stock - basic
|
$
|
6.01
|
|
|
$
|
1.63
|
|
|
$
|
1.36
|
|
Continuing operations - DHI Group - basic
|
$
|
(6.02
|
)
|
|
$
|
(5.61
|
)
|
|
$
|
(7.19
|
)
|
Discontinued operations - DHI Group - basic
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4.08
|
|
|
|
|
|
|
|
||||||
Earnings (loss) per share attributable to Dell Technologies Inc. - diluted:
|
|
|
|||||||||
Continuing operations - Class V Common Stock - diluted
|
$
|
5.91
|
|
|
$
|
1.61
|
|
|
$
|
1.35
|
|
Continuing operations - DHI Group - diluted
|
$
|
(6.04
|
)
|
|
$
|
(5.62
|
)
|
|
$
|
(7.19
|
)
|
Discontinued operations - DHI Group - diluted
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4.08
|
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
Net loss
|
$
|
(2,181
|
)
|
|
$
|
(2,926
|
)
|
|
$
|
(1,158
|
)
|
|
|
|
|
|
|
||||||
Other comprehensive income (loss), net of tax
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
(631
|
)
|
|
791
|
|
|
(254
|
)
|
|||
Available-for-sale investments:
|
|
|
|
|
|
||||||
Change in unrealized gains (losses)
|
2
|
|
|
31
|
|
|
(17
|
)
|
|||
Reclassification adjustment for net (gains) losses realized in net loss
|
43
|
|
|
2
|
|
|
1
|
|
|||
Net change in market value of investments
|
45
|
|
|
33
|
|
|
(16
|
)
|
|||
Cash flow hedges:
|
|
|
|
|
|
||||||
Change in unrealized gains (losses)
|
299
|
|
|
(248
|
)
|
|
20
|
|
|||
Reclassification adjustment for net (gains) losses included in net loss
|
(225
|
)
|
|
134
|
|
|
(43
|
)
|
|||
Net change in cash flow hedges
|
74
|
|
|
(114
|
)
|
|
(23
|
)
|
|||
Pension and other postretirement plans:
|
|
|
|
|
|
||||||
Recognition of actuarial net gains (losses) from pension and other postretirement plans
|
(21
|
)
|
|
13
|
|
|
19
|
|
|||
Reclassification adjustments for net (gains) losses from pension and other
|
—
|
|
|
—
|
|
|
—
|
|
|||
Net change in actuarial net gains (losses) from pension and other postretirement plans
|
(21
|
)
|
|
13
|
|
|
19
|
|
|||
|
|
|
|
|
|
||||||
Total other comprehensive income (loss), net of tax expense (benefit) of $14, $12, and $(3), respectively
|
(533
|
)
|
|
723
|
|
|
(274
|
)
|
|||
Comprehensive loss, net of tax
|
(2,714
|
)
|
|
(2,203
|
)
|
|
(1,432
|
)
|
|||
Less: Net income (loss) attributable to non-controlling interests
|
129
|
|
|
(77
|
)
|
|
9
|
|
|||
Less: Other comprehensive income (loss) attributable to non-controlling interests
|
6
|
|
|
(2
|
)
|
|
(3
|
)
|
|||
Comprehensive loss attributable to Dell Technologies Inc.
|
$
|
(2,849
|
)
|
|
$
|
(2,124
|
)
|
|
$
|
(1,438
|
)
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|||||
Net loss
|
$
|
(2,181
|
)
|
|
$
|
(2,926
|
)
|
|
$
|
(1,158
|
)
|
Adjustments to reconcile net loss to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
7,746
|
|
|
8,634
|
|
|
4,938
|
|
|||
Amortization of debt issuance costs
|
146
|
|
|
183
|
|
|
268
|
|
|||
Stock-based compensation expense
|
918
|
|
|
835
|
|
|
398
|
|
|||
Deferred income taxes
|
(1,331
|
)
|
|
(2,605
|
)
|
|
(2,052
|
)
|
|||
Net (gain) loss on sale of businesses
|
(30
|
)
|
|
16
|
|
|
(2,165
|
)
|
|||
Provision for doubtful accounts — including financing receivables
|
172
|
|
|
164
|
|
|
120
|
|
|||
Other
|
468
|
|
|
391
|
|
|
173
|
|
|||
Changes in assets and liabilities, net of effects from acquisitions and dispositions:
|
|
|
|
|
|
||||||
Accounts receivable
|
(1,104
|
)
|
|
(1,590
|
)
|
|
(1,935
|
)
|
|||
Financing receivables
|
(1,302
|
)
|
|
(1,653
|
)
|
|
(751
|
)
|
|||
Inventories
|
(1,445
|
)
|
|
(325
|
)
|
|
1,076
|
|
|||
Other assets
|
(534
|
)
|
|
(1,395
|
)
|
|
117
|
|
|||
Accounts payable
|
952
|
|
|
3,779
|
|
|
751
|
|
|||
Deferred revenue
|
3,418
|
|
|
2,748
|
|
|
1,933
|
|
|||
Accrued and other liabilities
|
1,098
|
|
|
587
|
|
|
654
|
|
|||
Change in cash from operating activities
|
6,991
|
|
|
6,843
|
|
|
2,367
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Investments:
|
|
|
|
|
|
||||||
Purchases
|
(925
|
)
|
|
(4,389
|
)
|
|
(778
|
)
|
|||
Maturities and sales
|
6,612
|
|
|
3,878
|
|
|
1,173
|
|
|||
Capital expenditures
|
(1,158
|
)
|
|
(1,212
|
)
|
|
(699
|
)
|
|||
Proceeds from sale of facilities, land, and other assets
|
10
|
|
|
—
|
|
|
24
|
|
|||
Capitalized software development costs
|
(339
|
)
|
|
(369
|
)
|
|
(207
|
)
|
|||
Collections on purchased financing receivables
|
30
|
|
|
30
|
|
|
35
|
|
|||
Acquisition of businesses, net
|
(912
|
)
|
|
(658
|
)
|
|
(37,609
|
)
|
|||
Divestitures of businesses, net
|
142
|
|
|
—
|
|
|
6,873
|
|
|||
Asset acquisitions, net
|
(59
|
)
|
|
(96
|
)
|
|
—
|
|
|||
Asset dispositions, net
|
(12
|
)
|
|
(59
|
)
|
|
—
|
|
|||
Other
|
—
|
|
|
—
|
|
|
(48
|
)
|
|||
Change in cash from investing activities
|
3,389
|
|
|
(2,875
|
)
|
|
(31,236
|
)
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Payment of dissenting shares obligation
|
(76
|
)
|
|
—
|
|
|
(446
|
)
|
|||
Share repurchases for tax withholdings of equity awards
|
(387
|
)
|
|
(385
|
)
|
|
(93
|
)
|
|||
Dividends paid to VMware, Inc.’s public stockholders
|
(2,134
|
)
|
|
—
|
|
|
—
|
|
|||
Proceeds from the issuance of DHI Group Common Stock
|
—
|
|
|
—
|
|
|
4,422
|
|
|||
Proceeds from the issuance of common stock of subsidiaries
|
803
|
|
|
131
|
|
|
164
|
|
|||
Repurchases of DHI Group Common Stock
|
(47
|
)
|
|
(6
|
)
|
|
(10
|
)
|
|||
Repurchases of Class V Common Stock
|
(14,000
|
)
|
|
(723
|
)
|
|
(701
|
)
|
|||
Repurchases of common stock of subsidiaries
|
(56
|
)
|
|
(724
|
)
|
|
(611
|
)
|
|||
Payments for debt issuance costs
|
(28
|
)
|
|
(48
|
)
|
|
(853
|
)
|
|||
Proceeds from debt
|
13,045
|
|
|
14,415
|
|
|
46,857
|
|
|||
Repayments of debt
|
(11,451
|
)
|
|
(12,258
|
)
|
|
(16,960
|
)
|
|||
Other
|
2
|
|
|
1
|
|
|
16
|
|
|||
Change in cash from financing activities
|
(14,329
|
)
|
|
403
|
|
|
31,785
|
|
|||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
|
(189
|
)
|
|
175
|
|
|
24
|
|
|||
Change in cash, cash equivalents, and restricted cash
|
(4,138
|
)
|
|
4,546
|
|
|
2,940
|
|
|||
Cash, cash equivalents, and restricted cash at beginning of the period
|
14,378
|
|
|
9,832
|
|
|
6,892
|
|
|||
Cash, cash equivalents, and restricted cash at end of the period
|
$
|
10,240
|
|
|
$
|
14,378
|
|
|
$
|
9,832
|
|
Income tax paid
|
$
|
747
|
|
|
$
|
924
|
|
|
$
|
978
|
|
Interest paid
|
$
|
2,347
|
|
|
$
|
2,192
|
|
|
$
|
1,575
|
|
|
Common Stock and Capital in Excess of
Par Value |
|
Treasury Stock
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||
|
DHI Group
|
|
Class V Common Stock
|
|
DHI Group
|
|
Class V Common Stock
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Issued Shares
|
|
Amount
|
|
Issued Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Income/(Loss)
|
|
Dell Technologies
Stockholders’ Equity (Deficit) |
|
Non-Controlling Interests
|
|
Total Stockholders’ Equity (Deficit)
|
||||||||||||||||||||||
Balances as of January 29, 2016, previously reported
|
405
|
|
|
$
|
5,727
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
(3,937
|
)
|
|
$
|
(324
|
)
|
|
$
|
1,466
|
|
|
—
|
|
|
1,466
|
|
||
Adjustment for adoption of accounting standard (Note 2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,009
|
|
|
—
|
|
|
1,009
|
|
|
—
|
|
|
1,009
|
|
|||||||||
Balances as of January 29, 2016, recast
|
405
|
|
|
$
|
5,727
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
(2,928
|
)
|
|
$
|
(324
|
)
|
|
$
|
2,475
|
|
|
—
|
|
|
2,475
|
|
||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,167
|
)
|
|
—
|
|
|
(1,167
|
)
|
|
9
|
|
|
(1,158
|
)
|
|||||||||
Foreign currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(254
|
)
|
|
(254
|
)
|
|
—
|
|
|
(254
|
)
|
|||||||||
Investments, net change
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(13
|
)
|
|
(13
|
)
|
|
(3
|
)
|
|
(16
|
)
|
|||||||||
Cash flow hedges, net change
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23
|
)
|
|
(23
|
)
|
|
—
|
|
|
(23
|
)
|
|||||||||
Pension and other post-retirement
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19
|
|
|
19
|
|
|
—
|
|
|
19
|
|
|||||||||
Fair value of non-controlling interests assumed in business combination
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,048
|
|
|
6,048
|
|
|||||||||
Issuance of common stock
|
164
|
|
|
4,441
|
|
|
223
|
|
|
10,041
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,482
|
|
|
—
|
|
|
14,482
|
|
|||||||||
Stock-based compensation expense
|
—
|
|
|
98
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
98
|
|
|
300
|
|
|
398
|
|
|||||||||
Tax benefit from stock-based compensation
|
—
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
1
|
|
|
10
|
|
|||||||||
Treasury stock repurchases
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
14
|
|
|
(742
|
)
|
|
—
|
|
|
—
|
|
|
(752
|
)
|
|
—
|
|
|
(752
|
)
|
|||||||||
Revaluation of redeemable shares
|
—
|
|
|
(125
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(125
|
)
|
|
—
|
|
|
(125
|
)
|
|||||||||
Impact from equity transactions of non-controlling interests
|
—
|
|
|
18
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
(534
|
)
|
|
(516
|
)
|
|||||||||
Other
|
—
|
|
|
(10
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
|
(10
|
)
|
|||||||||
Balances as of February 3, 2017
|
569
|
|
|
$
|
10,158
|
|
|
223
|
|
|
$
|
10,041
|
|
|
—
|
|
|
$
|
(10
|
)
|
|
14
|
|
|
$
|
(742
|
)
|
|
$
|
(4,095
|
)
|
|
$
|
(595
|
)
|
|
$
|
14,757
|
|
|
$
|
5,821
|
|
|
$
|
20,578
|
|
|
Common Stock and Capital in Excess of
Par Value |
|
Treasury Stock
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||
|
DHI Group
|
|
Class V Common Stock
|
|
DHI Group
|
|
Class V Common Stock
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Issued Shares
|
|
Amount
|
|
Issued Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Income/(Loss)
|
|
Dell Technologies
Stockholders’ Equity (Deficit) |
|
Non-Controlling Interests
|
|
Total Stockholders’ Equity (Deficit)
|
||||||||||||||||||||||
Balances as of February 3, 2017
|
569
|
|
|
$
|
10,158
|
|
|
223
|
|
|
$
|
10,041
|
|
|
—
|
|
|
$
|
(10
|
)
|
|
14
|
|
|
$
|
(742
|
)
|
|
$
|
(4,095
|
)
|
|
$
|
(595
|
)
|
|
$
|
14,757
|
|
|
$
|
5,821
|
|
|
$
|
20,578
|
|
Adjustment for adoption of accounting standard (Note 2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
84
|
|
|
—
|
|
|
84
|
|
|
—
|
|
|
84
|
|
|||||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,849
|
)
|
|
—
|
|
|
(2,849
|
)
|
|
(77
|
)
|
|
(2,926
|
)
|
|||||||||
Foreign currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
791
|
|
|
791
|
|
|
—
|
|
|
791
|
|
|||||||||
Investments, net change
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
35
|
|
|
35
|
|
|
(2
|
)
|
|
33
|
|
|||||||||
Cash flow hedges, net change
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(114
|
)
|
|
(114
|
)
|
|
—
|
|
|
(114
|
)
|
|||||||||
Pension and other post-retirement
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|
13
|
|
|
—
|
|
|
13
|
|
|||||||||
Issuance of common stock
|
2
|
|
|
(31
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(31
|
)
|
|
—
|
|
|
(31
|
)
|
|||||||||
Stock-based compensation expense
|
—
|
|
|
109
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
109
|
|
|
730
|
|
|
839
|
|
|||||||||
Treasury stock repurchases
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
(6
|
)
|
|
10
|
|
|
(682
|
)
|
|
—
|
|
|
—
|
|
|
(688
|
)
|
|
—
|
|
|
(688
|
)
|
|||||||||
Revaluation of redeemable shares
|
—
|
|
|
(153
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(153
|
)
|
|
—
|
|
|
(153
|
)
|
|||||||||
Impact from equity transactions of non-controlling interests
|
—
|
|
|
(235
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(235
|
)
|
|
(706
|
)
|
|
(941
|
)
|
|||||||||
Balances as of February 2, 2018
|
571
|
|
|
$
|
9,848
|
|
|
223
|
|
|
$
|
10,041
|
|
|
1
|
|
|
$
|
(16
|
)
|
|
24
|
|
|
$
|
(1,424
|
)
|
|
$
|
(6,860
|
)
|
|
$
|
130
|
|
|
$
|
11,719
|
|
|
$
|
5,766
|
|
|
$
|
17,485
|
|
|
Common Stock and Capital in Excess of
Par Value |
|
Treasury Stock
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||
|
DHI Group
|
|
Class V Common Stock
|
|
DHI Group
|
|
Class V Common Stock
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||
|
Issued Shares
|
|
Amount
|
|
Issued Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Accumulated Deficit
|
|
Accumulated Other Comprehensive Income/(Loss)
|
|
Dell Technologies
Stockholders’ Equity (Deficit) |
|
Non-Controlling Interests
|
|
Total Stockholders’ Equity (Deficit)
|
||||||||||||||||||||||
Balances as of February 2, 2018
|
571
|
|
|
$
|
9,848
|
|
|
223
|
|
|
$
|
10,041
|
|
|
1
|
|
|
$
|
(16
|
)
|
|
24
|
|
|
$
|
(1,424
|
)
|
|
$
|
(6,860
|
)
|
|
$
|
130
|
|
|
$
|
11,719
|
|
|
$
|
5,766
|
|
|
$
|
17,485
|
|
Adjustment for adoption of accounting standards (Note 2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
58
|
|
|
(58
|
)
|
|
—
|
|
|
(5
|
)
|
|
(5
|
)
|
|||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,310
|
)
|
|
—
|
|
|
(2,310
|
)
|
|
129
|
|
|
(2,181
|
)
|
|||||||||
Foreign currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
(631
|
)
|
|
(631
|
)
|
|
—
|
|
|
(631
|
)
|
||||||||||
Investments, net change
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
39
|
|
|
39
|
|
|
6
|
|
|
45
|
|
|||||||||
Cash flow hedges, net change
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
74
|
|
|
74
|
|
|
—
|
|
|
74
|
|
|||||||||
Pension and other post-retirement
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21
|
)
|
|
(21
|
)
|
|
—
|
|
|
(21
|
)
|
|||||||||
Issuance of common stock
|
150
|
|
|
6,845
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,872
|
)
|
|
—
|
|
|
(27
|
)
|
|
—
|
|
|
(27
|
)
|
|||||||||
Stock-based compensation expense
|
—
|
|
|
99
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
99
|
|
|
819
|
|
|
918
|
|
|||||||||
Treasury stock repurchases
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
(47
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(47
|
)
|
|
—
|
|
|
(47
|
)
|
|||||||||
Revaluation of redeemable shares
|
—
|
|
|
(812
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(812
|
)
|
|
—
|
|
|
(812
|
)
|
|||||||||
Repurchase of Class V Common Stock
|
—
|
|
|
—
|
|
|
(223
|
)
|
|
(10,041
|
)
|
|
—
|
|
|
—
|
|
|
(24
|
)
|
|
1,424
|
|
|
(5,365
|
)
|
|
—
|
|
|
(13,982
|
)
|
|
—
|
|
|
(13,982
|
)
|
|||||||||
Impact from equity transactions of non-controlling interests
|
—
|
|
|
134
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
134
|
|
|
(1,892
|
)
|
|
(1,758
|
)
|
|||||||||
Balances as of February 1, 2019
|
721
|
|
|
$
|
16,114
|
|
|
—
|
|
|
$
|
—
|
|
|
2
|
|
|
$
|
(63
|
)
|
|
—
|
|
|
$
|
—
|
|
|
$
|
(21,349
|
)
|
|
$
|
(467
|
)
|
|
$
|
(5,765
|
)
|
|
$
|
4,823
|
|
|
$
|
(942
|
)
|
|
Fiscal Year Ended February 3, 2017
|
||||||||||||||
|
ECD (a)
|
|
Dell Services
|
|
DSG
|
|
Total
|
||||||||
|
(in millions)
|
||||||||||||||
Net revenue
|
$
|
208
|
|
|
$
|
1,980
|
|
|
$
|
975
|
|
|
$
|
3,163
|
|
Cost of net revenue
|
56
|
|
|
1,563
|
|
|
250
|
|
|
1,869
|
|
||||
Operating expenses
|
137
|
|
|
347
|
|
|
726
|
|
|
1,210
|
|
||||
Interest and other, net
|
(1
|
)
|
|
(8
|
)
|
|
(2
|
)
|
|
(11
|
)
|
||||
Income (loss) from discontinued operations before income taxes and gain (loss) on disposal
|
14
|
|
|
62
|
|
|
(3
|
)
|
|
73
|
|
||||
Income tax provision (benefit)
|
3
|
|
|
(40
|
)
|
|
(23
|
)
|
|
(60
|
)
|
||||
Income from discontinued operations, net of income taxes, before gain (loss) on disposal
|
11
|
|
|
102
|
|
|
20
|
|
|
133
|
|
||||
Gain (loss) on disposal, net of tax expense (benefit) of $181, $(262), and $462, respectively
|
(356
|
)
|
|
1,669
|
|
|
470
|
|
|
1,783
|
|
||||
Income (loss) from discontinued operations, net of income taxes
|
$
|
(345
|
)
|
|
$
|
1,771
|
|
|
$
|
490
|
|
|
$
|
1,916
|
|
(a)
|
The results of ECD were classified as discontinued operations for the period from September 7, 2016 through February 3, 2017 because the ECD business was only included in the Company’s consolidated results since the closing of the EMC merger transaction.
|
|
Estimated Useful Life
|
Computer equipment
|
3-5 years
|
Buildings
|
10-30 years or term of underlying land lease
|
Leasehold improvements
|
Shorter of 5-20 years or lease term
|
Machinery and equipment
|
3-5 years
|
(1)
|
Identify the contract with a customer. The term “contract” refers to the enforceable rights and obligations provided in an agreement between the Company and the customer in exchange for payment. The Company evaluates facts and circumstances regarding sales transactions in order to identify contracts with its customers. An agreement must meet all of the following criteria to qualify as a contract eligible for revenue recognition under the model: (i) the contract must be approved by all parties who are committed to perform their respective obligations; (ii) each party’s rights regarding the goods and services to be transferred to the customer can be identified; (iii) the payment terms for the goods and services can be identified; (iv) the customer has the ability and intent to pay and it is probable that the Company will collect substantially all of the consideration to which we will be entitled; and (v) the contract must have commercial substance. Judgment is used in determining the customer’s ability and intent to pay, which is based upon various factors, including the customer’s historical payment experience or customer credit and financial information.
|
(2)
|
Identify the performance obligations in the contract. The Company’s contracts with customer often include the promise to transfer multiple goods and services to a customer. Distinct promises within a contract are referred to as “performance obligations” and are accounted for as separate units of account. The Company assesses whether each promised good or service is distinct for the purpose of identifying the performance obligations in the contract. This assessment involves subjective determinations and requires management to make judgments about the individual promised goods or services and whether such goods or services are separable from the other aspects of the contractual relationship. Promised goods and services are considered distinct provided that: (i) the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (that is, the good or service is capable of being distinct); and (ii) the Company’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (that is, the promise to transfer the good or service is distinct within the context of the contract). The Company’s performance obligations include various distinct goods and services such as hardware, software licenses, warranties, and other service offerings and solutions. Promised goods and services are explicitly identified in the Company’s contracts and may be sold on a standalone basis or bundled as part of a combined solution. In certain hardware solutions, the hardware is highly interdependent on, and interrelated with, the embedded software. In these offerings, the hardware and software licenses are accounted for as a single performance obligation.
|
(3)
|
Determine the transaction price. The transaction price reflects the amount of consideration to which the Company expects to be entitled in exchange for transferring goods or services to the customer. If the consideration promised in a contract includes a variable amount, the Company estimates the amount to which it expects to be entitled using either the expected value or most likely amount method. Generally, volume discounts, rebates, and sales returns reduce the transaction price. In determining the transaction price, the Company only includes amounts that are not subject to significant future reversal.
|
(4)
|
Allocate the transaction price to performance obligations in the contract. When a contract includes multiple performance obligations, the transaction price is allocated to each performance obligation in an amount that depicts the consideration to which the Company expects to be entitled in exchange for transferring the promised goods or services. For contracts with multiple performance obligations, the transaction price is allocated in proportion to the standalone selling price (“SSP”) of each performance obligation.
|
(5)
|
Recognize revenue when (or as) the performance obligation is satisfied. Revenue is recognized when obligations under the terms of the contract with the Company’s customer are satisfied. Revenue is recognized either over time or at a point in time, depending on when the underlying products or services are transferred to the customer. Revenue is recognized at a point in time for products upon transfer of control. Revenue is recognized over time for support and deployment services, software support, SaaS, and IaaS. Revenue is recognized either over time or at a point in time for professional services and training depending on the nature of the offering to the customer.
|
•
|
The Company does not account for significant financing components if the period between revenue recognition and when the customer pays for the product or service will be one year or less.
|
•
|
The Company recognizes revenue equal to the amount it has a right to invoice when the amount corresponds directly with the value to the customer of the Company’s performance to date.
|
•
|
The Company does not account for shipping and handling activities as a separate performance obligation, but rather as an activity performed to transfer the promised good.
|
|
February 2, 2018
|
||||||||||
|
As Reported (a)
|
|
Revenue from Contracts with Customers
|
|
As Recast
|
||||||
|
(in millions)
|
||||||||||
Assets
|
|
|
|
|
|
||||||
Accounts receivable, net
|
$
|
11,177
|
|
|
$
|
544
|
|
|
$
|
11,721
|
|
Other current assets
|
$
|
5,054
|
|
|
$
|
827
|
|
|
$
|
5,881
|
|
Other non-current assets
|
$
|
1,862
|
|
|
$
|
541
|
|
|
$
|
2,403
|
|
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
||||||
Accrued and other
|
$
|
7,661
|
|
|
$
|
365
|
|
|
$
|
8,026
|
|
Short-term deferred revenue
|
$
|
12,024
|
|
|
$
|
(418
|
)
|
|
$
|
11,606
|
|
Long-term deferred revenue
|
$
|
10,223
|
|
|
$
|
(1,013
|
)
|
|
$
|
9,210
|
|
Other non-current liabilities
|
$
|
6,797
|
|
|
$
|
480
|
|
|
$
|
7,277
|
|
Accumulated deficit
|
$
|
(9,253
|
)
|
|
$
|
2,393
|
|
|
$
|
(6,860
|
)
|
Non-controlling interests
|
$
|
5,661
|
|
|
$
|
105
|
|
|
$
|
5,766
|
|
(a)
|
Amounts as reported in the Company’s annual report on Form 10-K for the fiscal year ended February 2, 2018.
|
•
|
First, the return rights provision, which represents an estimate of expected customer returns, that was previously presented as a reduction of accounts receivable, net is now being presented outside of accounts receivable, net in two separate balance sheet line items. A liability is recorded in accrued and other for the estimated value of the sales amounts to be returned to the customer, and an asset is recorded in other current assets representing the recoverable cost of the inventory estimated to be returned.
|
•
|
Second, the standard provides new guidance regarding transfer of control of goods to the customer. Under these new guidelines, the Company has determined that for certain hardware contracts in the United States, transfer of control and recognition of revenue can occur earlier. This determination resulted in an increase in accounts receivable, net and a decrease in the in-transit deferral recorded in other current assets.
|
(a)
|
Amounts as reported in the Company’s annual report on Form 10-K for the fiscal year ended February 2, 2018.
|
•
|
Under the new revenue standard, amounts within a contract are now allocated to the product and services performance obligations based on their respective standalone selling prices, which generally increases product revenue and decreases services revenue relative to previously reported results.
|
•
|
Further, third-party software licenses were previously recognized in services revenue as the Company could not separate the value of the software license from the associated maintenance agreement. Under the new revenue standard, the license value requires separation and will be recognized in product revenue, and the value of the software maintenance will continue to be recognized in services revenue.
|
|
Fiscal Year Ended February 2, 2018
|
||||||||||||||
|
As Reported (a)
|
|
Classification of Certain Cash Receipts and Cash Payments
|
|
Statement of Cash Flows, Restricted Cash
|
|
As Recast
|
||||||||
|
(in millions)
|
||||||||||||||
Change in cash from operating activities
|
$
|
6,810
|
|
|
$
|
48
|
|
|
$
|
(15
|
)
|
|
$
|
6,843
|
|
Change in cash from investing activities
|
$
|
(2,881
|
)
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
(2,875
|
)
|
Change in cash from financing activities
|
$
|
364
|
|
|
$
|
(48
|
)
|
|
$
|
87
|
|
|
$
|
403
|
|
|
|
|
|
|
|
|
|
||||||||
Change in cash, cash equivalents, and restricted cash
|
$
|
4,468
|
|
|
$
|
—
|
|
|
$
|
78
|
|
|
$
|
4,546
|
|
Cash, cash equivalents, and restricted cash at beginning of the period
|
9,474
|
|
|
—
|
|
|
358
|
|
|
$
|
9,832
|
|
|||
Cash, cash equivalents, and restricted cash at end of the period
|
$
|
13,942
|
|
|
$
|
—
|
|
|
$
|
436
|
|
|
$
|
14,378
|
|
|
|
|
|
|
|
|
|
||||||||
|
Fiscal Year Ended February 3, 2017
|
||||||||||||||
|
As Reported (a)
|
|
Classification of Certain Cash Receipts and Cash Payments
|
|
Statement of Cash Flows, Restricted Cash
|
|
As Recast
|
||||||||
|
(in millions)
|
||||||||||||||
Change in cash from operating activities
|
$
|
2,309
|
|
|
$
|
39
|
|
|
$
|
19
|
|
|
$
|
2,367
|
|
Change in cash from investing activities
|
$
|
(31,256
|
)
|
|
$
|
—
|
|
|
$
|
20
|
|
|
$
|
(31,236
|
)
|
Change in cash from financing activities
|
$
|
31,821
|
|
|
$
|
(39
|
)
|
|
$
|
3
|
|
|
$
|
31,785
|
|
|
|
|
|
|
|
|
|
||||||||
Change in cash, cash equivalents, and restricted cash
|
$
|
2,898
|
|
|
$
|
—
|
|
|
$
|
42
|
|
|
$
|
2,940
|
|
Cash, cash equivalents, and restricted cash at beginning of the period
|
6,576
|
|
|
—
|
|
|
316
|
|
|
$
|
6,892
|
|
|||
Cash, cash equivalents, and restricted cash at end of the period
|
$
|
9,474
|
|
|
$
|
—
|
|
|
$
|
358
|
|
|
$
|
9,832
|
|
(a)
|
Amounts as reported in the Company’s annual report on Form 10-K for the fiscal year ended February 2, 2018.
|
|
February 1, 2019 (a)
|
|
February 2, 2018 (a)
|
||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
|
Quoted
Prices in Active Markets for Identical Assets |
|
Significant
Other Observable Inputs |
|
Significant
Unobservable Inputs |
|
|
|
Quoted
Prices in Active Markets for Identical Assets |
|
Significant
Other Observable Inputs |
|
Significant
Unobservable Inputs |
|
|
||||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Money market funds
|
$
|
5,221
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,221
|
|
|
$
|
8,641
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,641
|
|
U.S. corporate debt securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
23
|
|
|
—
|
|
|
23
|
|
||||||||
Foreign corporate debt securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
65
|
|
|
—
|
|
|
65
|
|
||||||||
Debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
U.S. government and agencies
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
682
|
|
|
392
|
|
|
—
|
|
|
1,074
|
|
||||||||
U.S. corporate
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,003
|
|
|
—
|
|
|
2,003
|
|
||||||||
Foreign
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,547
|
|
|
—
|
|
|
2,547
|
|
||||||||
Equity and other securities
|
314
|
|
|
20
|
|
|
—
|
|
|
334
|
|
|
236
|
|
|
5
|
|
|
—
|
|
|
241
|
|
||||||||
Derivative instruments
|
—
|
|
|
97
|
|
|
—
|
|
|
97
|
|
|
—
|
|
|
83
|
|
|
—
|
|
|
83
|
|
||||||||
Total assets
|
$
|
5,535
|
|
|
$
|
117
|
|
|
$
|
—
|
|
|
$
|
5,652
|
|
|
$
|
9,559
|
|
|
$
|
5,118
|
|
|
$
|
—
|
|
|
$
|
14,677
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Derivative instruments
|
$
|
—
|
|
|
$
|
60
|
|
|
$
|
—
|
|
|
$
|
60
|
|
|
$
|
—
|
|
|
$
|
184
|
|
|
$
|
—
|
|
|
$
|
184
|
|
Total liabilities
|
$
|
—
|
|
|
$
|
60
|
|
|
$
|
—
|
|
|
$
|
60
|
|
|
$
|
—
|
|
|
$
|
184
|
|
|
$
|
—
|
|
|
$
|
184
|
|
(a)
|
The Company did not transfer any financial instruments between levels during the fiscal years ended February 1, 2019 and February 2, 2018.
|
|
February 1, 2019
|
|
February 2, 2018
|
||||||||||||
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
|
(in billions)
|
||||||||||||||
Senior Secured Credit Facilities
|
$
|
12.5
|
|
|
$
|
12.6
|
|
|
$
|
10.4
|
|
|
$
|
10.6
|
|
First Lien Notes
|
$
|
19.8
|
|
|
$
|
21.0
|
|
|
$
|
19.7
|
|
|
$
|
21.9
|
|
Unsecured Notes and Debentures
|
$
|
1.8
|
|
|
$
|
1.9
|
|
|
$
|
2.3
|
|
|
$
|
2.5
|
|
Senior Notes
|
$
|
3.1
|
|
|
$
|
3.4
|
|
|
$
|
3.1
|
|
|
$
|
3.4
|
|
EMC Notes
|
$
|
3.0
|
|
|
$
|
2.9
|
|
|
$
|
5.5
|
|
|
$
|
5.4
|
|
VMware Notes
|
$
|
4.0
|
|
|
$
|
3.9
|
|
|
$
|
4.0
|
|
|
$
|
3.9
|
|
Margin Loan Facility
|
$
|
3.3
|
|
|
$
|
3.4
|
|
|
$
|
2.0
|
|
|
$
|
2.0
|
|
|
February 1, 2019
|
|
February 2, 2018
|
||||||||||||||||||||||||||||
|
Cost
|
|
Unrealized Gain
|
|
Unrealized (Loss)
|
|
Carrying Value
|
|
Cost
|
|
Unrealized Gain
|
|
Unrealized (Loss)
|
|
Carrying Value
|
||||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||||||
Investments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
U.S. government and agencies
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
485
|
|
|
$
|
—
|
|
|
$
|
(2
|
)
|
|
$
|
483
|
|
U.S. corporate debt securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
660
|
|
|
—
|
|
|
(2
|
)
|
|
658
|
|
||||||||
Foreign debt securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,048
|
|
|
—
|
|
|
(2
|
)
|
|
1,046
|
|
||||||||
Total short-term investments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,193
|
|
|
—
|
|
|
(6
|
)
|
|
2,187
|
|
||||||||
U.S. government and agencies
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
600
|
|
|
—
|
|
|
(9
|
)
|
|
591
|
|
||||||||
U.S. corporate debt securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,361
|
|
|
—
|
|
|
(16
|
)
|
|
1,345
|
|
||||||||
Foreign debt securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,518
|
|
|
—
|
|
|
(17
|
)
|
|
1,501
|
|
||||||||
Equity and other securities (a)
|
638
|
|
|
539
|
|
|
(172
|
)
|
|
1,005
|
|
|
640
|
|
|
86
|
|
|
—
|
|
|
726
|
|
||||||||
Total long-term investments
|
638
|
|
|
539
|
|
|
(172
|
)
|
|
1,005
|
|
|
4,119
|
|
|
86
|
|
|
(42
|
)
|
|
4,163
|
|
||||||||
Total investments
|
$
|
638
|
|
|
$
|
539
|
|
|
$
|
(172
|
)
|
|
$
|
1,005
|
|
|
$
|
6,312
|
|
|
$
|
86
|
|
|
$
|
(48
|
)
|
|
$
|
6,350
|
|
(a)
|
$671 million and $485 million of equity and other securities as of February 1, 2019 and February 2, 2018, respectively, are private strategic investments without readily determinable fair values, which are recorded at cost, less impairment, and adjusted for observable price changes. For the fiscal year ended February 1, 2019, the equity and other securities without readily determinable fair values increased by $233 million due to upward adjustments for observable price changes, offset by $80 million of downward adjustments that were primarily attributable to impairments. The remainder of equity and other securities consists of publicly-traded investments that are measured at fair value on a recurring basis. See Note 3 of the Notes to the Consolidated Financial Statements for additional information on investments measured at fair value.
|
•
|
Revolving loans — Revolving loans offered under private label credit financing programs provide qualified customers with a revolving credit line for the purchase of products and services offered by Dell Technologies. These private label credit financing programs are referred to as Dell Preferred Account (“DPA”) and Dell Business Credit (“DBC”). The DPA product is primarily offered to individual consumer customers, and the DBC product is primarily offered to small and medium-sized commercial customers. Revolving loans in the United States bear interest at a variable annual percentage rate that is tied to the prime rate. Based on historical payment patterns, revolving loan transactions are typically repaid within twelve months on average. Due to the short-term nature of the revolving loan portfolio, the carrying value of the portfolio approximates fair value.
|
•
|
Fixed-term sales-type leases and loans — The Company enters into sales-type lease arrangements with customers who seek lease financing. Leases with business customers have fixed terms of generally two to four years. Future maturities of minimum lease and associated financing payments as of February 1, 2019 were as follows: $2.6 billion in Fiscal 2020; $1.7 billion in Fiscal 2021; $0.9 billion in Fiscal 2022; $0.3 billion in Fiscal 2023; and $0.1 billion in Fiscal 2024 and beyond. Future maturities and associated financing payments referenced herein represent the aggregate payments under the customer lease contract. The Company also offers fixed-term loans to qualified small businesses, large commercial accounts, governmental organizations, educational entities, and certain individual consumer customers. These loans are repaid in equal payments including interest and have defined terms of generally three to five years. The fair value of the fixed-term loan portfolio is determined using market observable inputs. The carrying value of these loans approximates fair value.
|
|
February 1, 2019
|
|
February 2, 2018
|
||||||||||||||||||||
|
Revolving
|
|
Fixed-term
|
|
Total
|
|
Revolving
|
|
Fixed-term
|
|
Total
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Financing receivables, net:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Customer receivables, gross (a)
|
$
|
835
|
|
|
$
|
7,249
|
|
|
$
|
8,084
|
|
|
$
|
900
|
|
|
$
|
6,282
|
|
|
$
|
7,182
|
|
Allowances for losses
|
(75
|
)
|
|
(61
|
)
|
|
(136
|
)
|
|
(81
|
)
|
|
(64
|
)
|
|
(145
|
)
|
||||||
Customer receivables, net
|
760
|
|
|
7,188
|
|
|
7,948
|
|
|
819
|
|
|
6,218
|
|
|
7,037
|
|
||||||
Residual interest
|
—
|
|
|
674
|
|
|
674
|
|
|
—
|
|
|
606
|
|
|
606
|
|
||||||
Financing receivables, net
|
$
|
760
|
|
|
$
|
7,862
|
|
|
$
|
8,622
|
|
|
$
|
819
|
|
|
$
|
6,824
|
|
|
$
|
7,643
|
|
Short-term
|
$
|
760
|
|
|
$
|
3,638
|
|
|
$
|
4,398
|
|
|
$
|
819
|
|
|
$
|
3,100
|
|
|
$
|
3,919
|
|
Long-term
|
$
|
—
|
|
|
$
|
4,224
|
|
|
$
|
4,224
|
|
|
$
|
—
|
|
|
$
|
3,724
|
|
|
$
|
3,724
|
|
(a)
|
Customer financing receivables, gross includes accrued interest.
|
|
Revolving
|
|
Fixed-term
|
|
Total
|
||||||
|
(in millions)
|
||||||||||
Allowance for financing receivable losses:
|
|
|
|
|
|
||||||
Balances as of January 29, 2016
|
$
|
118
|
|
|
$
|
58
|
|
|
$
|
176
|
|
Charge-offs, net of recoveries
|
(91
|
)
|
|
(17
|
)
|
|
(108
|
)
|
|||
Provision charged to income statement
|
64
|
|
|
11
|
|
|
75
|
|
|||
Balances as of February 3, 2017
|
91
|
|
|
52
|
|
|
143
|
|
|||
Charge-offs, net of recoveries
|
(84
|
)
|
|
(17
|
)
|
|
(101
|
)
|
|||
Provision charged to income statement
|
74
|
|
|
29
|
|
|
103
|
|
|||
Balances as of February 2, 2018
|
81
|
|
|
64
|
|
|
145
|
|
|||
Charge-offs, net of recoveries
|
(78
|
)
|
|
(26
|
)
|
|
(104
|
)
|
|||
Provision charged to income statement
|
72
|
|
|
23
|
|
|
95
|
|
|||
Balances as of February 1, 2019
|
$
|
75
|
|
|
$
|
61
|
|
|
$
|
136
|
|
|
February 1, 2019
|
|
February 2, 2018
|
||||||||||||||||||||||||||||
|
Current
|
|
Past Due
1 — 90 Days |
|
Past Due
>90 Days |
|
Total
|
|
Current
|
|
Past Due
1 — 90 Days |
|
Past Due
>90 Days |
|
Total
|
||||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||||||
Revolving — DPA
|
$
|
583
|
|
|
$
|
53
|
|
|
$
|
21
|
|
|
$
|
657
|
|
|
$
|
633
|
|
|
$
|
59
|
|
|
$
|
23
|
|
|
$
|
715
|
|
Revolving — DBC
|
155
|
|
|
19
|
|
|
4
|
|
|
178
|
|
|
162
|
|
|
19
|
|
|
4
|
|
|
185
|
|
||||||||
Fixed-term — Consumer and Commercial
|
6,282
|
|
|
878
|
|
|
89
|
|
|
7,249
|
|
|
5,414
|
|
|
775
|
|
|
93
|
|
|
6,282
|
|
||||||||
Total customer receivables, gross
|
$
|
7,020
|
|
|
$
|
950
|
|
|
$
|
114
|
|
|
$
|
8,084
|
|
|
$
|
6,209
|
|
|
$
|
853
|
|
|
$
|
120
|
|
|
$
|
7,182
|
|
|
February 1, 2019
|
|
February 2, 2018
|
||||||||||||||||||||||||||||
|
Higher
|
|
Mid
|
|
Lower
|
|
Total
|
|
Higher
|
|
Mid
|
|
Lower
|
|
Total
|
||||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||||||
Revolving — DPA
|
$
|
128
|
|
|
$
|
192
|
|
|
$
|
337
|
|
|
$
|
657
|
|
|
$
|
131
|
|
|
$
|
223
|
|
|
$
|
361
|
|
|
$
|
715
|
|
Revolving — DBC
|
$
|
47
|
|
|
$
|
54
|
|
|
$
|
77
|
|
|
$
|
178
|
|
|
$
|
48
|
|
|
$
|
58
|
|
|
$
|
79
|
|
|
$
|
185
|
|
Fixed-term — Consumer and Commercial
|
$
|
3,980
|
|
|
$
|
1,984
|
|
|
$
|
1,285
|
|
|
$
|
7,249
|
|
|
$
|
3,334
|
|
|
$
|
1,828
|
|
|
$
|
1,120
|
|
|
$
|
6,282
|
|
|
February 1, 2019
|
|
February 2, 2018
|
||||
|
(in millions)
|
||||||
DFS U.S. debt:
|
|
|
|
||||
Securitization facilities
|
$
|
1,914
|
|
|
$
|
1,498
|
|
Fixed-term securitization offerings
|
2,303
|
|
|
2,034
|
|
||
Other
|
223
|
|
|
32
|
|
||
Total DFS U.S. debt
|
4,440
|
|
|
3,564
|
|
||
DFS international debt:
|
|
|
|
||||
Securitization facility
|
584
|
|
|
404
|
|
||
Other borrowings
|
708
|
|
|
628
|
|
||
Note payable
|
197
|
|
|
200
|
|
||
Total DFS international debt
|
1,489
|
|
|
1,232
|
|
||
Total DFS debt
|
$
|
5,929
|
|
|
$
|
4,796
|
|
Total short-term DFS debt
|
$
|
3,113
|
|
|
$
|
3,327
|
|
Total long-term DFS debt
|
$
|
2,816
|
|
|
$
|
1,469
|
|
|
February 1, 2019
|
|
February 2, 2018
|
||||
|
(in millions)
|
||||||
Financing receivables held by consolidated VIEs, net:
|
|
|
|
|
|
||
Short-term, net
|
$
|
2,940
|
|
|
$
|
2,572
|
|
Long-term, net
|
2,508
|
|
|
1,981
|
|
||
Financing receivables held by consolidated VIEs, net
|
$
|
5,448
|
|
|
$
|
4,553
|
|
|
February 1, 2019
|
|
February 2, 2018
|
||||
|
(in millions)
|
||||||
Secured Debt
|
|
|
|
||||
Senior Secured Credit Facilities:
|
|
|
|
||||
4.50% Term Loan B Facility due September 2023
|
$
|
4,938
|
|
|
$
|
4,988
|
|
4.25% Term Loan A-2 Facility due September 2021
|
4,116
|
|
|
4,394
|
|
||
Term Loan A-3 Facility due December 2018
|
—
|
|
|
1,213
|
|
||
4.25% Term Loan A-4 Facility due December 2023
|
1,650
|
|
|
—
|
|
||
4.25% Term Loan A-5 Facility due December 2019
|
2,016
|
|
|
—
|
|
||
First Lien Notes:
|
|
|
|
||||
3.48% due June 2019
|
3,750
|
|
|
3,750
|
|
||
4.42% due June 2021
|
4,500
|
|
|
4,500
|
|
||
5.45% due June 2023
|
3,750
|
|
|
3,750
|
|
||
6.02% due June 2026
|
4,500
|
|
|
4,500
|
|
||
8.10% due July 2036
|
1,500
|
|
|
1,500
|
|
||
8.35% due July 2046
|
2,000
|
|
|
2,000
|
|
||
Unsecured Debt
|
|
|
|
||||
Unsecured Notes and Debentures:
|
|
|
|
||||
5.65% due April 2018
|
—
|
|
|
500
|
|
||
5.875% due June 2019
|
600
|
|
|
600
|
|
||
4.625% due April 2021
|
400
|
|
|
400
|
|
||
7.10% due April 2028
|
300
|
|
|
300
|
|
||
6.50% due April 2038
|
388
|
|
|
388
|
|
||
5.40% due September 2040
|
264
|
|
|
264
|
|
||
Senior Notes:
|
|
|
|
||||
5.875% due June 2021
|
1,625
|
|
|
1,625
|
|
||
7.125% due June 2024
|
1,625
|
|
|
1,625
|
|
||
EMC Notes:
|
|
|
|
||||
1.875% due June 2018
|
—
|
|
|
2,500
|
|
||
2.650% due June 2020
|
2,000
|
|
|
2,000
|
|
||
3.375% due June 2023
|
1,000
|
|
|
1,000
|
|
||
VMware Notes:
|
|
|
|
||||
2.30% due August 2020
|
1,250
|
|
|
1,250
|
|
||
2.95% due August 2022
|
1,500
|
|
|
1,500
|
|
||
3.90% due August 2027
|
1,250
|
|
|
1,250
|
|
||
DFS Debt (Note 5)
|
5,929
|
|
|
4,796
|
|
||
Other
|
|
|
|
||||
4.99% Margin Loan Facility due April 2022
|
3,350
|
|
|
2,000
|
|
||
Other
|
38
|
|
|
101
|
|
||
Total debt, principal amount
|
$
|
54,239
|
|
|
$
|
52,694
|
|
|
February 1, 2019
|
|
February 2, 2018
|
||||
|
(in millions)
|
||||||
Total debt, principal amount
|
$
|
54,239
|
|
|
$
|
52,694
|
|
Unamortized discount, net of unamortized premium
|
(271
|
)
|
|
(266
|
)
|
||
Debt issuance costs
|
(447
|
)
|
|
(557
|
)
|
||
Total debt, carrying value
|
$
|
53,521
|
|
|
$
|
51,871
|
|
Total short-term debt, carrying value
|
$
|
4,320
|
|
|
$
|
7,873
|
|
Total long-term debt, carrying value (a)
|
$
|
49,201
|
|
|
$
|
43,998
|
|
(a)
|
Subsequent to the fiscal year ended February 1, 2019, the Company issued long-term debt and used the net proceeds to repay all of the First Lien Notes due June 2019 and the Term Loan A-5 Facility due December 2019. As of February 1, 2019, the carrying values of the First Lien Notes due June 2019 and Term Loan A-5 Facility due December 2019 were classified as long-term debt. See Note 24 of the Notes to the Consolidated Financial Statements for additional information regarding debt issuances and refinancing transactions.
|
|
Maturities by Fiscal Year
|
||||||||||||||||||||||||||
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
2024
|
|
Thereafter
|
|
Total
|
||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||
Senior Secured Credit Facilities and First Lien Notes
|
$
|
6,344
|
|
|
$
|
433
|
|
|
$
|
7,969
|
|
|
$
|
166
|
|
|
$
|
9,807
|
|
|
$
|
8,001
|
|
|
$
|
32,720
|
|
Unsecured Notes and Debentures
|
600
|
|
|
—
|
|
|
400
|
|
|
—
|
|
|
—
|
|
|
952
|
|
|
1,952
|
|
|||||||
Senior Notes and EMC Notes
|
—
|
|
|
2,000
|
|
|
1,625
|
|
|
—
|
|
|
1,000
|
|
|
1,625
|
|
|
6,250
|
|
|||||||
VMware Notes
|
—
|
|
|
1,250
|
|
|
—
|
|
|
1,500
|
|
|
—
|
|
|
1,250
|
|
|
4,000
|
|
|||||||
DFS Debt
|
3,113
|
|
|
2,373
|
|
|
335
|
|
|
95
|
|
|
13
|
|
|
—
|
|
|
5,929
|
|
|||||||
Margin Loan Facility
|
—
|
|
|
—
|
|
|
—
|
|
|
3,350
|
|
|
—
|
|
|
—
|
|
|
3,350
|
|
|||||||
Other
|
29
|
|
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|
|
38
|
|
|||||||
Total maturities, principal amount
|
10,086
|
|
|
6,065
|
|
|
10,329
|
|
|
5,111
|
|
|
10,820
|
|
|
11,828
|
|
|
54,239
|
|
|||||||
Associated carrying value adjustments
|
(40
|
)
|
|
(6
|
)
|
|
(136
|
)
|
|
(30
|
)
|
|
(163
|
)
|
|
(343
|
)
|
|
(718
|
)
|
|||||||
Total maturities, carrying value amount
|
$
|
10,046
|
|
|
$
|
6,059
|
|
|
$
|
10,193
|
|
|
$
|
5,081
|
|
|
$
|
10,657
|
|
|
$
|
11,485
|
|
|
$
|
53,521
|
|
|
February 1, 2019
|
|
February 2, 2018
|
||||
|
(in millions)
|
||||||
Foreign exchange contracts:
|
|
|
|
|
|
||
Designated as cash flow hedging instruments
|
$
|
7,573
|
|
|
$
|
4,392
|
|
Non-designated as hedging instruments
|
6,129
|
|
|
6,223
|
|
||
Total
|
$
|
13,702
|
|
|
$
|
10,615
|
|
Interest rate contracts:
|
|
|
|
||||
Non-designated as hedging instruments
|
$
|
2,674
|
|
|
$
|
1,897
|
|
Derivatives in Cash Flow Hedging Relationships
|
|
Gain (Loss) Recognized in Accumulated OCI, Net of Tax, on Derivatives
|
|
Location of Gain (Loss) Reclassified from Accumulated OCI into Income
|
|
Gain (Loss) Reclassified from Accumulated OCI into Income
|
|
Location of Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
|
|
Gain (Loss) Recognized in Income on Derivative (Ineffective Portion)
|
||||||
|
|
(in millions)
|
|
|
|
(in millions)
|
|
|
|
(in millions)
|
||||||
For the fiscal year ended February 1, 2019
|
|
|
|
|
||||||||||||
|
|
|
|
|
Total net revenue
|
|
$
|
225
|
|
|
|
|
|
|||
Foreign exchange contracts
|
|
$
|
299
|
|
|
Total cost of net revenue
|
|
—
|
|
|
|
|
|
|||
Interest rate contracts
|
|
—
|
|
|
Interest and other, net
|
|
—
|
|
|
Interest and other, net
|
|
—
|
|
|||
Total
|
|
$
|
299
|
|
|
|
|
$
|
225
|
|
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
For the fiscal year ended February 2, 2018
|
|
|
|
|
||||||||||||
|
|
|
|
|
Total net revenue
|
|
$
|
(77
|
)
|
|
|
|
|
|||
Foreign exchange contracts
|
|
$
|
(248
|
)
|
|
Total cost of net revenue
|
|
(57
|
)
|
|
|
|
|
|||
Interest rate contracts
|
|
—
|
|
|
Interest and other, net
|
|
—
|
|
|
Interest and other, net
|
|
—
|
|
|||
Total
|
|
$
|
(248
|
)
|
|
|
|
$
|
(134
|
)
|
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
For the fiscal year ended February 3, 2017
|
|
|
|
|
||||||||||||
|
|
|
|
|
Total net revenue
|
|
$
|
57
|
|
|
|
|
|
|||
Foreign exchange contracts
|
|
$
|
20
|
|
|
Total cost of net revenue
|
|
(13
|
)
|
|
|
|
|
|||
Interest rate contracts
|
|
—
|
|
|
Interest and other, net
|
|
—
|
|
|
Interest and other, net
|
|
(1
|
)
|
|||
Total
|
|
$
|
20
|
|
|
|
|
$
|
44
|
|
|
|
|
$
|
(1
|
)
|
|
Fiscal Year Ended
|
|
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
|
Location of Gain (Loss) Recognized
|
||||||
|
(in millions)
|
|
|
||||||||||
Foreign exchange contracts
|
$
|
(67
|
)
|
|
$
|
(106
|
)
|
|
$
|
(9
|
)
|
|
Interest and other, net
|
Interest rate contracts
|
(8
|
)
|
|
4
|
|
|
(3
|
)
|
|
Interest and other, net
|
|||
Total
|
$
|
(75
|
)
|
|
$
|
(102
|
)
|
|
$
|
(12
|
)
|
|
|
|
February 1, 2019
|
||||||||||||||||||
|
Other Current
Assets |
|
Other Non-
Current Assets |
|
Other Current
Liabilities |
|
Other Non-Current
Liabilities |
|
Total
Fair Value |
||||||||||
|
|
|
(in millions)
|
|
|
||||||||||||||
Derivatives designated as hedging instruments:
|
|||||||||||||||||||
Foreign exchange contracts in an asset position
|
$
|
45
|
|
|
$
|
—
|
|
|
$
|
29
|
|
|
$
|
—
|
|
|
$
|
74
|
|
Foreign exchange contracts in a liability position
|
(19
|
)
|
|
—
|
|
|
(20
|
)
|
|
—
|
|
|
(39
|
)
|
|||||
Net asset (liability)
|
26
|
|
|
—
|
|
|
9
|
|
|
—
|
|
|
35
|
|
|||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|
||||||||||
Foreign exchange contracts in an asset position
|
178
|
|
|
—
|
|
|
57
|
|
|
—
|
|
|
235
|
|
|||||
Foreign exchange contracts in a liability position
|
(110
|
)
|
|
—
|
|
|
(115
|
)
|
|
(2
|
)
|
|
(227
|
)
|
|||||
Interest rate contracts in an asset position
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||
Interest rate contracts in a liability position
|
—
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
|
(9
|
)
|
|||||
Net asset (liability)
|
68
|
|
|
3
|
|
|
(58
|
)
|
|
(11
|
)
|
|
2
|
|
|||||
Total derivatives at fair value
|
$
|
94
|
|
|
$
|
3
|
|
|
$
|
(49
|
)
|
|
$
|
(11
|
)
|
|
$
|
37
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
February 2, 2018
|
||||||||||||||||||
|
Other Current
Assets |
|
Other Non-
Current Assets |
|
Other Current
Liabilities |
|
Other Non-Current
Liabilities |
|
Total
Fair Value |
||||||||||
|
|
|
(in millions)
|
|
|
||||||||||||||
Derivatives designated as hedging instruments:
|
|||||||||||||||||||
Foreign exchange contracts in an asset position
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
—
|
|
|
$
|
20
|
|
Foreign exchange contracts in a liability position
|
(7
|
)
|
|
—
|
|
|
(52
|
)
|
|
—
|
|
|
(59
|
)
|
|||||
Net asset (liability)
|
2
|
|
|
—
|
|
|
(41
|
)
|
|
—
|
|
|
(39
|
)
|
|||||
Derivatives not designated as hedging instruments:
|
|||||||||||||||||||
Foreign exchange contracts in an asset position
|
194
|
|
|
3
|
|
|
141
|
|
|
—
|
|
|
338
|
|
|||||
Foreign exchange contracts in a liability position
|
(127
|
)
|
|
—
|
|
|
(283
|
)
|
|
—
|
|
|
(410
|
)
|
|||||
Interest rate contracts in an asset position
|
—
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|||||
Interest rate contracts in a liability position
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|||||
Net asset (liability)
|
67
|
|
|
14
|
|
|
(142
|
)
|
|
(1
|
)
|
|
(62
|
)
|
|||||
Total derivatives at fair value
|
$
|
69
|
|
|
$
|
14
|
|
|
$
|
(183
|
)
|
|
$
|
(1
|
)
|
|
$
|
(101
|
)
|
|
February 1, 2019
|
||||||||||||||||||||||
|
Gross Amounts of Recognized Assets/ (Liabilities)
|
|
Gross Amounts Offset in the Statement of Financial Position
|
|
Net Amounts of Assets/ (Liabilities) Presented in the Statement of Financial Position
|
|
Gross Amounts not Offset in the Statement of Financial Position
|
|
Net Amount
|
||||||||||||||
|
Financial Instruments
|
|
Cash Collateral Received or Pledged
|
|
|||||||||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Derivative instruments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Financial assets
|
$
|
312
|
|
|
$
|
(215
|
)
|
|
$
|
97
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
97
|
|
Financial liabilities
|
(275
|
)
|
|
215
|
|
|
(60
|
)
|
|
—
|
|
|
4
|
|
|
(56
|
)
|
||||||
Total derivative instruments
|
$
|
37
|
|
|
$
|
—
|
|
|
$
|
37
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
41
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
February 2, 2018
|
||||||||||||||||||||||
|
Gross Amounts of Recognized Assets/ (Liabilities)
|
|
Gross Amounts Offset in the Statement of Financial Position
|
|
Net Amounts of Assets/ (Liabilities) Presented in the Statement of Financial Position
|
|
Gross Amounts not Offset in the Statement of Financial Position
|
|
Net Amount
|
||||||||||||||
|
Financial Instruments
|
|
Cash Collateral Received or Pledged
|
|
|||||||||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Derivative instruments:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Financial assets
|
$
|
369
|
|
|
$
|
(286
|
)
|
|
$
|
83
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
83
|
|
Financial liabilities
|
(470
|
)
|
|
286
|
|
|
(184
|
)
|
|
—
|
|
|
—
|
|
|
(184
|
)
|
||||||
Total derivative instruments
|
$
|
(101
|
)
|
|
$
|
—
|
|
|
$
|
(101
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(101
|
)
|
|
Purchase Price
|
||
|
(in millions)
|
||
Consideration transferred:
|
|
||
Cash
|
$
|
47,694
|
|
Expense and other (a)
|
968
|
|
|
Class V Common Stock (b)
|
10,041
|
|
|
Total consideration transferred
|
58,703
|
|
|
Non-controlling interests (c)
|
6,048
|
|
|
Less: Post-merger stock compensation expense (d)
|
(800
|
)
|
|
Total purchase price to allocate
|
$
|
63,951
|
|
(a)
|
Expense and other primarily consists of cash payment for post-merger stock compensation expense, as described in footnote (d), and the value related to pre-merger services of EMC equity awards converted to deferred cash awards.
|
(b)
|
The fair value of the Class V Common Stock is based on the issuance of approximately 223 million shares with a per-share fair value of $45.07 (the opening share price of the Class V Common Stock on the NYSE on September 7, 2016, the first day of trading), which shares were intended to track the economic performance of approximately 65% of the Company’s economic interest in the VMware business, as of the closing date of the EMC merger transaction.
|
(c)
|
Non-controlling interests in VMware, Inc. and Pivotal was $6 billion as of September 7, 2016. The fair value of the non-controlling interest related to VMware, Inc. was calculated by multiplying outstanding shares of VMware, Inc. common stock that were not owned by EMC by $73.28 (the opening share price of VMware, Inc. Class A common stock on the NYSE on September 7, 2016). The fair value of the non-controlling interest relating to Pivotal was calculated based on the fair value of Pivotal, the ownership percentage of the non-controlling interests, and a discount for lack of control related to the non-controlling interest.
|
(d)
|
Pursuant to the guidelines of ASC 805, a portion of the consideration related to accelerated EMC equity awards was recorded as post-merger day one stock compensation expense. This expense is attributable to post-merger services not rendered due to the acceleration.
|
Current assets:
|
|
||
Cash and cash equivalents
|
$
|
10,080
|
|
Short-term investments
|
1,765
|
|
|
Accounts receivable
|
2,810
|
|
|
Short-term financing receivables
|
64
|
|
|
Inventories, net
|
1,993
|
|
|
Other current assets
|
903
|
|
|
Total current assets
|
17,615
|
|
|
Property, plant, and equipment
|
4,490
|
|
|
Long-term investments
|
4,317
|
|
|
Long-term financing receivables
|
65
|
|
|
Goodwill
|
31,539
|
|
|
Purchased intangibles
|
31,218
|
|
|
Other non-current assets
|
445
|
|
|
Total assets
|
$
|
89,689
|
|
Current liabilities:
|
|
||
Short-term debt
|
$
|
905
|
|
Accounts payable
|
728
|
|
|
Accrued and other
|
3,259
|
|
|
Short-term deferred revenue
|
4,954
|
|
|
Total current liabilities
|
9,846
|
|
|
Long-term debt
|
5,474
|
|
|
Long-term deferred revenue
|
3,469
|
|
|
Deferred tax liabilities
|
6,625
|
|
|
Other non-current liabilities
|
324
|
|
|
Total liabilities
|
25,738
|
|
|
Total net assets
|
$
|
63,951
|
|
|
Fiscal Year Ended
|
||
|
February 3, 2017
|
||
|
(in millions)
|
||
Total net revenue
|
$
|
74,116
|
|
Net loss attributable to Dell Technologies Inc.
|
$
|
(3,220
|
)
|
|
Infrastructure Solutions Group (a)
|
|
Client Solutions Group
|
|
VMware
|
|
Other Businesses (b)
|
|
Total
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Balance as of February 3, 2017
|
$
|
15,607
|
|
|
$
|
4,237
|
|
|
$
|
15,070
|
|
|
$
|
3,996
|
|
|
$
|
38,910
|
|
Goodwill acquired
|
—
|
|
|
—
|
|
|
565
|
|
|
9
|
|
|
574
|
|
|||||
Impact of foreign currency translation
|
359
|
|
|
—
|
|
|
—
|
|
|
90
|
|
|
449
|
|
|||||
Goodwill divested
|
(13
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(13
|
)
|
|||||
Balance as of February 2, 2018
|
$
|
15,953
|
|
|
$
|
4,237
|
|
|
$
|
15,635
|
|
|
$
|
4,095
|
|
|
$
|
39,920
|
|
Goodwill acquired (c)
|
—
|
|
|
—
|
|
|
784
|
|
|
—
|
|
|
784
|
|
|||||
Impact of foreign currency translation
|
(289
|
)
|
|
—
|
|
|
—
|
|
|
(67
|
)
|
|
(356
|
)
|
|||||
Goodwill divested
|
(69
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(69
|
)
|
|||||
Other adjustments (d)
|
(396
|
)
|
|
—
|
|
|
—
|
|
|
396
|
|
|
—
|
|
|||||
Goodwill impaired (e)
|
—
|
|
|
—
|
|
|
—
|
|
|
(190
|
)
|
|
(190
|
)
|
|||||
Balance as of February 1, 2019
|
$
|
15,199
|
|
|
$
|
4,237
|
|
|
$
|
16,419
|
|
|
$
|
4,234
|
|
|
$
|
40,089
|
|
(a)
|
Infrastructure Solutions Group is composed of the Core Storage, Servers, and Networking goodwill reporting unit.
|
(b)
|
Other Businesses consists of offerings by Pivotal, Secureworks, RSA Security LLC (“RSA Security”), Virtustream Group Holdings, Inc. (“Virtustream”), and Boomi, Inc. (“Boomi”).
|
(c)
|
During the fiscal year ended February 1, 2019, VMware, Inc. completed the acquisitions of CloudHealth Technologies and Heptio.
|
(d)
|
During the three months ended May 4, 2018, the Company made certain segment reporting changes, which included the movement of the results of Virtustream from the Infrastructure Solutions Group segment to Other businesses. The amount of goodwill attributable to Virtustream was reclassified to Other businesses to align with these reporting changes.
|
(e)
|
The Company recognized a goodwill impairment charge related to Virtustream, as discussed below.
|
|
February 1, 2019
|
|
February 2, 2018
|
||||||||||||||||||||
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
|
|
Accumulated
Amortization
|
|
Net
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Customer relationships
|
$
|
22,750
|
|
|
$
|
(11,703
|
)
|
|
$
|
11,047
|
|
|
$
|
22,764
|
|
|
$
|
(8,637
|
)
|
|
$
|
14,127
|
|
Developed technology
|
15,701
|
|
|
(9,036
|
)
|
|
6,665
|
|
|
15,586
|
|
|
(6,196
|
)
|
|
9,390
|
|
||||||
Trade names
|
1,291
|
|
|
(606
|
)
|
|
685
|
|
|
1,277
|
|
|
(407
|
)
|
|
870
|
|
||||||
Leasehold assets (liabilities)
|
128
|
|
|
(10
|
)
|
|
118
|
|
|
128
|
|
|
(6
|
)
|
|
122
|
|
||||||
Definite-lived intangible assets
|
39,870
|
|
|
(21,355
|
)
|
|
18,515
|
|
|
39,755
|
|
|
(15,246
|
)
|
|
24,509
|
|
||||||
Indefinite-lived trade names
|
3,755
|
|
|
—
|
|
|
3,755
|
|
|
3,756
|
|
|
—
|
|
|
3,756
|
|
||||||
Total intangible assets
|
$
|
43,625
|
|
|
$
|
(21,355
|
)
|
|
$
|
22,270
|
|
|
$
|
43,511
|
|
|
$
|
(15,246
|
)
|
|
$
|
28,265
|
|
Fiscal Years
|
(in millions)
|
||
2020
|
$
|
4,391
|
|
2021
|
3,362
|
|
|
2022
|
2,652
|
|
|
2023
|
1,767
|
|
|
2024
|
1,403
|
|
|
Thereafter
|
4,940
|
|
|
Total
|
$
|
18,515
|
|
|
Fiscal Year Ended
|
||||||
|
February 1, 2019
|
|
February 2, 2018
|
||||
|
(in millions)
|
||||||
Deferred revenue:
|
|
|
|
||||
Deferred revenue at beginning of period
|
$
|
20,816
|
|
|
$
|
17,815
|
|
Revenue deferrals for new contracts and changes in estimates for pre-existing contracts (a) (b)
|
20,580
|
|
|
18,478
|
|
||
Revenue recognized (b)
|
(17,386
|
)
|
|
(15,477
|
)
|
||
Deferred revenue at end of period
|
$
|
24,010
|
|
|
20,816
|
|
|
Short-term deferred revenue
|
$
|
12,944
|
|
|
$
|
11,606
|
|
Long-term deferred revenue
|
$
|
11,066
|
|
|
$
|
9,210
|
|
(a)
|
Includes the impact of foreign currency exchange rate fluctuations.
|
(b)
|
The Company conformed the presentation of certain deferred revenue rollforward activity for the fiscal year ended February 2, 2018 to align to current year presentation. The beginning and ending deferred revenue liability balances remain unchanged.
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
461
|
|
|
$
|
52
|
|
|
$
|
(139
|
)
|
State/local
|
74
|
|
|
111
|
|
|
46
|
|
|||
Foreign
|
616
|
|
|
599
|
|
|
322
|
|
|||
Current
|
1,151
|
|
|
762
|
|
|
229
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
Federal
|
(1,150
|
)
|
|
(2,368
|
)
|
|
(1,510
|
)
|
|||
State/local
|
(85
|
)
|
|
(139
|
)
|
|
(105
|
)
|
|||
Foreign
|
(96
|
)
|
|
(98
|
)
|
|
(34
|
)
|
|||
Deferred
|
(1,331
|
)
|
|
(2,605
|
)
|
|
(1,649
|
)
|
|||
Income tax benefit
|
$
|
(180
|
)
|
|
$
|
(1,843
|
)
|
|
$
|
(1,420
|
)
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Domestic
|
$
|
(4,645
|
)
|
|
$
|
(5,995
|
)
|
|
$
|
(6,698
|
)
|
Foreign
|
2,284
|
|
|
1,226
|
|
|
2,204
|
|
|||
Loss from continuing operations before income taxes
|
$
|
(2,361
|
)
|
|
$
|
(4,769
|
)
|
|
$
|
(4,494
|
)
|
|
Fiscal Year Ended
|
|||||||
|
February 1, 2019
|
|
February 2, 2018 (a)
|
|
February 3, 2017 (a)
|
|||
U.S. federal statutory rate
|
21.0
|
%
|
|
33.7
|
%
|
|
35.0
|
%
|
State income taxes, net of federal tax benefit
|
0.5
|
|
|
2.9
|
|
|
2.9
|
|
Tax impact of foreign operations
|
(19.5
|
)
|
|
(11.0
|
)
|
|
(6.2
|
)
|
Change in valuation allowance
|
(6.6
|
)
|
|
(1.8
|
)
|
|
(1.1
|
)
|
Indirect tax effects of adoption of new revenue standard
|
6.5
|
|
|
—
|
|
|
—
|
|
U.S. Tax Reform
|
1.5
|
|
|
11.6
|
|
|
—
|
|
IRS tax audit settlement
|
—
|
|
|
—
|
|
|
6.6
|
|
Non-deductible transaction-related costs
|
(1.9
|
)
|
|
—
|
|
|
(1.1
|
)
|
Stock-based compensation
|
4.1
|
|
|
1.6
|
|
|
(0.2
|
)
|
Other tax credits
|
6.9
|
|
|
2.6
|
|
|
1.1
|
|
Other
|
(4.9
|
)
|
|
(1.0
|
)
|
|
(5.4
|
)
|
Total
|
7.6
|
%
|
|
38.6
|
%
|
|
31.6
|
%
|
(a)
|
Prior periods have been conformed to current year presentation.
|
|
February 1, 2019
|
|
February 2, 2018
|
||||
|
(in millions)
|
||||||
Deferred tax assets:
|
|
|
|
||||
Deferred revenue and warranty provisions
|
$
|
1,267
|
|
|
$
|
1,022
|
|
Provisions for product returns and doubtful accounts
|
117
|
|
|
95
|
|
||
Credit carryforwards
|
1,927
|
|
|
540
|
|
||
Loss carryforwards
|
466
|
|
|
509
|
|
||
Operating and compensation related accruals
|
683
|
|
|
604
|
|
||
Other
|
193
|
|
|
158
|
|
||
Deferred tax assets
|
4,653
|
|
|
2,928
|
|
||
Valuation allowance
|
(1,704
|
)
|
|
(777
|
)
|
||
Deferred tax assets, net of valuation allowance
|
2,949
|
|
|
2,151
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Leasing and financing
|
(356
|
)
|
|
(178
|
)
|
||
Property and equipment
|
(547
|
)
|
|
(483
|
)
|
||
Acquired intangibles
|
(3,254
|
)
|
|
(4,004
|
)
|
||
Other
|
(242
|
)
|
|
(344
|
)
|
||
Deferred tax liabilities
|
(4,399
|
)
|
|
(5,009
|
)
|
||
Net deferred tax liabilities
|
$
|
(1,450
|
)
|
|
$
|
(2,858
|
)
|
|
February 1, 2019
|
|
|
||||||||||
|
Deferred Tax Assets
|
|
Valuation Allowance
|
|
Net Deferred Tax Assets
|
|
First Year Expiring
|
||||||
|
(in millions)
|
||||||||||||
Credit carryforwards
|
$
|
1,927
|
|
|
$
|
(1,152
|
)
|
|
$
|
775
|
|
|
Fiscal 2020
|
Loss carryforwards
|
466
|
|
|
(403
|
)
|
|
63
|
|
|
Fiscal 2020
|
|||
Other deferred tax assets
|
2,260
|
|
|
(149
|
)
|
|
2,111
|
|
|
NA
|
|||
Total
|
$
|
4,653
|
|
|
$
|
(1,704
|
)
|
|
$
|
2,949
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
February 2, 2018
|
|
|
||||||||||
|
Deferred Tax Assets
|
|
Valuation Allowance
|
|
Net Deferred Tax Assets
|
|
First Year Expiring
|
||||||
|
(in millions)
|
||||||||||||
Credit carryforwards
|
$
|
540
|
|
|
$
|
(366
|
)
|
|
$
|
174
|
|
|
Fiscal 2019
|
Loss carryforwards
|
509
|
|
|
(279
|
)
|
|
230
|
|
|
Fiscal 2019
|
|||
Other deferred tax assets
|
1,879
|
|
|
(132
|
)
|
|
1,747
|
|
|
NA
|
|||
Total
|
$
|
2,928
|
|
|
$
|
(777
|
)
|
|
$
|
2,151
|
|
|
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Beginning Balance
|
$
|
2,867
|
|
|
$
|
2,752
|
|
|
$
|
2,479
|
|
Unrecognized tax benefits assumed through EMC merger transaction
|
—
|
|
|
—
|
|
|
558
|
|
|||
Increases related to tax positions of the current year
|
116
|
|
|
155
|
|
|
116
|
|
|||
Increases related to tax position of prior years
|
288
|
|
|
98
|
|
|
227
|
|
|||
Reductions for tax positions of prior years
|
(170
|
)
|
|
(90
|
)
|
|
(379
|
)
|
|||
Lapse of statute of limitations
|
(90
|
)
|
|
(34
|
)
|
|
(30
|
)
|
|||
Audit settlements
|
(22
|
)
|
|
(14
|
)
|
|
(219
|
)
|
|||
Ending Balance
|
$
|
2,989
|
|
|
$
|
2,867
|
|
|
$
|
2,752
|
|
|
Foreign Currency Translation Adjustments
|
|
Investments
|
|
Cash Flow Hedges
|
|
Pension and Other Postretirement Plans
|
|
Accumulated Other Comprehensive Income (Loss)
|
||||||||||
|
(in millions)
|
||||||||||||||||||
Balances as of January 29, 2016
|
$
|
(358
|
)
|
|
$
|
—
|
|
|
$
|
34
|
|
|
$
|
—
|
|
|
(324
|
)
|
|
Other comprehensive income (loss) before reclassifications
|
(254
|
)
|
|
(17
|
)
|
|
20
|
|
|
19
|
|
|
(232
|
)
|
|||||
Amounts reclassified from accumulated other comprehensive income (loss)
|
—
|
|
|
1
|
|
|
(43
|
)
|
|
—
|
|
|
(42
|
)
|
|||||
Total change for the period
|
(254
|
)
|
|
(16
|
)
|
|
(23
|
)
|
|
19
|
|
|
(274
|
)
|
|||||
Less: Change in comprehensive income (loss) attributable to non-controlling interests
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|||||
Balances as of February 3, 2017
|
(612
|
)
|
|
(13
|
)
|
|
11
|
|
|
19
|
|
|
(595
|
)
|
|||||
Other comprehensive income (loss) before reclassifications
|
791
|
|
|
31
|
|
|
(248
|
)
|
|
13
|
|
|
587
|
|
|||||
Amounts reclassified from accumulated other comprehensive income (loss)
|
—
|
|
|
2
|
|
|
134
|
|
|
—
|
|
|
136
|
|
|||||
Total change for the period
|
791
|
|
|
33
|
|
|
(114
|
)
|
|
13
|
|
|
723
|
|
|||||
Less: Change in comprehensive loss attributable to non-controlling interests
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|||||
Balances as of February 2, 2018
|
179
|
|
|
22
|
|
|
(103
|
)
|
|
32
|
|
|
130
|
|
|||||
Adjustment for adoption of accounting standards (Note 2)
|
—
|
|
|
(61
|
)
|
|
—
|
|
|
3
|
|
|
(58
|
)
|
|||||
Other comprehensive income (loss) before reclassifications
|
(631
|
)
|
|
2
|
|
|
299
|
|
|
(21
|
)
|
|
(351
|
)
|
|||||
Amounts reclassified from accumulated other comprehensive income (loss)
|
—
|
|
|
43
|
|
|
(225
|
)
|
|
—
|
|
|
(182
|
)
|
|||||
Total change for the period
|
(631
|
)
|
|
(16
|
)
|
|
74
|
|
|
(18
|
)
|
|
(591
|
)
|
|||||
Less: Change in comprehensive income attributable to non-controlling interests
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|||||
Balances as of February 1, 2019
|
$
|
(452
|
)
|
|
$
|
—
|
|
|
$
|
(29
|
)
|
|
$
|
14
|
|
|
$
|
(467
|
)
|
|
Fiscal Year Ended
|
||||||||||||||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
||||||||||||||||||||
|
Investments
|
|
Cash Flow Hedges
|
|
Total
|
|
Investments
|
|
Cash Flow Hedges
|
|
Total
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Total reclassifications, net of tax:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net revenue
|
$
|
—
|
|
|
$
|
225
|
|
|
$
|
225
|
|
|
$
|
—
|
|
|
$
|
(77
|
)
|
|
$
|
(77
|
)
|
Cost of net revenue
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(57
|
)
|
|
(57
|
)
|
||||||
Interest and other, net
|
(43
|
)
|
|
—
|
|
|
(43
|
)
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
||||||
Total reclassifications, net of tax
|
$
|
(43
|
)
|
|
$
|
225
|
|
|
$
|
182
|
|
|
$
|
(2
|
)
|
|
$
|
(134
|
)
|
|
$
|
(136
|
)
|
|
Fiscal Year Ended
|
||
|
February 1, 2019
|
||
|
(in millions)
|
||
Net loss attributable to Dell Technologies Inc.
|
$
|
(2,310
|
)
|
Transfers (to)/from the non-controlling interests:
|
|
||
Increase in Dell Technologies Inc. additional paid-in-capital for equity issuances and other equity activity
|
954
|
|
|
Decrease in Dell Technologies Inc. additional paid-in-capital for equity issuances and other equity activity
|
(820
|
)
|
|
Net transfers from non-controlling interests
|
134
|
|
|
Change from net loss attributable to Dell Technologies Inc. and transfers (to)/from the non-controlling interests
|
$
|
(2,176
|
)
|
|
Authorized
|
|
Issued
|
|
Outstanding
|
|||
|
(in millions)
|
|||||||
Common stock as of February 2, 2018
|
||||||||
Class A
|
600
|
|
|
410
|
|
|
410
|
|
Class B
|
200
|
|
|
137
|
|
|
137
|
|
Class C
|
7,900
|
|
|
24
|
|
|
23
|
|
Class D
|
100
|
|
|
—
|
|
|
—
|
|
Class V
|
343
|
|
|
223
|
|
|
199
|
|
|
9,143
|
|
|
794
|
|
|
769
|
|
|
|
|
|
|
|
|||
Common stock as of February 1, 2019
|
||||||||
Class A
|
600
|
|
|
410
|
|
|
410
|
|
Class B
|
200
|
|
|
137
|
|
|
137
|
|
Class C
|
7,900
|
|
|
174
|
|
|
172
|
|
Class D
|
100
|
|
|
—
|
|
|
—
|
|
Class V
|
343
|
|
|
—
|
|
|
—
|
|
|
9,143
|
|
|
721
|
|
|
719
|
|
|
Class V Common Stock
|
|
DHI Group Retained Interest
|
||||||
|
Shares of Class V Common Stock
|
|
Interest in Class V Group
|
|
Retained Interest Shares
|
|
Interest in Class V Group
|
||
|
(in millions, except percentages)
|
||||||||
As of September 7, 2016
|
223
|
|
|
65%
|
|
120
|
|
|
35%
|
DHI Group Repurchase Program
|
(7
|
)
|
|
|
|
7
|
|
|
|
Class V Group Repurchase Program
|
(7
|
)
|
|
|
|
—
|
|
|
|
As of February 3, 2017
|
209
|
|
|
62%
|
|
127
|
|
|
38%
|
Class V Group Repurchase Program
|
(10
|
)
|
|
|
|
—
|
|
|
|
As of February 2, 2018
|
199
|
|
|
61%
|
|
127
|
|
|
39%
|
Repurchases of Class V Common Stock
|
(199
|
)
|
|
|
|
(127
|
)
|
|
|
As of December 28, 2018
|
—
|
|
|
—%
|
|
—
|
|
|
—%
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
Earnings (loss) per share attributable to Dell Technologies Inc. - basic:
|
|
|
|
|
|
||||||
Continuing operations - Class V Common Stock - basic
|
$
|
6.01
|
|
|
$
|
1.63
|
|
|
$
|
1.36
|
|
Continuing operations - DHI Group - basic
|
$
|
(6.02
|
)
|
|
$
|
(5.61
|
)
|
|
$
|
(7.19
|
)
|
Discontinued operations - DHI Group - basic
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4.08
|
|
|
|
|
|
|
|
||||||
Earnings (loss) per share attributable to Dell Technologies Inc. - diluted:
|
|
|
|
|
|
||||||
Continuing operations - Class V Common Stock - diluted
|
$
|
5.91
|
|
|
$
|
1.61
|
|
|
$
|
1.35
|
|
Continuing operations - DHI Group - diluted
|
$
|
(6.04
|
)
|
|
$
|
(5.62
|
)
|
|
$
|
(7.19
|
)
|
Discontinued operations - DHI Group - diluted
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4.08
|
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Numerator: Continuing operations - Class V Common Stock
|
|
|
|
|
|
||||||
Net income from continuing operations attributable to Class V Common Stock - basic (a)
|
$
|
1,195
|
|
|
$
|
331
|
|
|
$
|
296
|
|
Incremental dilution from VMware, Inc. attributable to Class V Common Stock (b)
|
(18
|
)
|
|
(5
|
)
|
|
(3
|
)
|
|||
Net income from continuing operations attributable to Class V Common Stock - diluted
|
$
|
1,177
|
|
|
$
|
326
|
|
|
$
|
293
|
|
|
|
|
|
|
|
||||||
Numerator: Continuing operations - DHI Group
|
|
|
|
|
|
||||||
Net loss from continuing operations attributable to DHI Group - basic
|
$
|
(3,505
|
)
|
|
$
|
(3,180
|
)
|
|
$
|
(3,379
|
)
|
Incremental dilution from VMware, Inc. attributable to DHI Group (b)
|
(13
|
)
|
|
(4
|
)
|
|
(2
|
)
|
|||
Net loss from continuing operations attributable to DHI Group - diluted
|
$
|
(3,518
|
)
|
|
$
|
(3,184
|
)
|
|
$
|
(3,381
|
)
|
|
|
|
|
|
|
||||||
Numerator: Discontinued operations - DHI Group
|
|
|
|
|
|
||||||
Income from discontinued operations, net of income taxes - basic and diluted
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,916
|
|
|
|
|
|
|
|
||||||
Denominator: Class V Common Stock weighted-average shares outstanding
|
|
|
|
|
|
|
|
||||
Weighted-average shares outstanding - basic (c)
|
199
|
|
|
203
|
|
|
217
|
|
|||
Dilutive effect of options, restricted stock units, restricted stock, and other (d)
|
—
|
|
|
—
|
|
|
—
|
|
|||
Weighted-average shares outstanding - diluted
|
199
|
|
|
203
|
|
|
217
|
|
|||
Weighted-average shares outstanding - antidilutive (d)
|
—
|
|
|
—
|
|
|
—
|
|
|||
|
|
|
|
|
|
||||||
Denominator: DHI Group weighted-average shares outstanding
|
|
|
|
|
|
||||||
Weighted-average shares outstanding - basic (e)
|
582
|
|
|
567
|
|
|
470
|
|
|||
Dilutive effect of options, restricted stock units, restricted stock, and other
|
—
|
|
|
—
|
|
|
—
|
|
|||
Weighted-average shares outstanding - diluted
|
582
|
|
|
567
|
|
|
470
|
|
|||
Weighted-average shares outstanding - antidilutive (f)
|
44
|
|
|
35
|
|
|
31
|
|
(a)
|
For the fiscal year ended February 1, 2019, net income attributable to the Class V Common Stock - basic represents net income attributable to the Class V Group for the period ended December 27, 2018, the last date on which the Class V Common Stock was traded on the NYSE.
|
(b)
|
The incremental dilution from VMware, Inc. represents the impact of VMware, Inc.’s dilutive securities on the diluted earnings (loss) per share of the DHI Group and the Class V Common Stock, respectively, and is calculated by multiplying the difference between VMware, Inc.’s basic and diluted earnings (loss) per share by the number of shares of VMware, Inc. common stock held by the Company.
|
(c)
|
For the fiscal year ended February 1, 2019, the Class V Common Stock weighted-average shares outstanding - basic represents the weighted-average for the period ended December 27, 2018, the last date on which the Class V Common Stock was traded on the NYSE.
|
(d)
|
The dilutive effect of Class V Common Stock-based incentive awards was not material to the calculation of the weighted-average Class V Common Stock shares outstanding. The antidilutive effect of these awards was also not material.
|
(e)
|
For the fiscal year ended February 1, 2019, the DHI Group weighted-average shares outstanding - basic represents the weighted-average shares over the twelve month period, with the Class C shares appropriately weighted for the number of days outstanding before and after the completion of the Class V transaction.
|
(f)
|
Stock-based incentive awards have been excluded from the calculation of the DHI Group’s diluted loss per share because their effect would have been antidilutive, as the Company had a net loss from continuing operations attributable to the DHI Group for the periods presented.
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Net income from continuing operations attributable to Class V Common Stock
|
$
|
1,195
|
|
|
$
|
331
|
|
|
$
|
296
|
|
Net loss from continuing operations attributable to DHI Group
|
(3,505
|
)
|
|
(3,180
|
)
|
|
(3,379
|
)
|
|||
Net loss from continuing operations attributable to Dell Technologies Inc.
|
(2,310
|
)
|
|
(2,849
|
)
|
|
(3,083
|
)
|
|||
Income from discontinued operations, net of income taxes (Note 1)
|
—
|
|
|
—
|
|
|
1,916
|
|
|||
Net loss attributable to Dell Technologies Inc.
|
$
|
(2,310
|
)
|
|
$
|
(2,849
|
)
|
|
$
|
(1,167
|
)
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Stock-based compensation expense (a) (b):
|
|
|
|
|
|
|
|||||
Cost of net revenue
|
$
|
76
|
|
|
$
|
66
|
|
|
$
|
35
|
|
Operating expenses
|
842
|
|
|
769
|
|
|
363
|
|
|||
Stock-based compensation expense before taxes
|
918
|
|
|
835
|
|
|
398
|
|
|||
Income tax benefit
|
(260
|
)
|
|
(268
|
)
|
|
(122
|
)
|
|||
Stock-based compensation expense, net of income taxes
|
$
|
658
|
|
|
$
|
567
|
|
|
$
|
276
|
|
(a)
|
As a result of the EMC merger transaction, stock-based compensation expense before taxes for the fiscal years ended February 1, 2019 and February 2, 2018 includes $731 million and $683 million related to VMware, Inc. plans discussed below. Stock-based compensation expense before taxes for the fiscal year ended February 3, 2017 includes $279 million related to VMware, Inc. plans for the period from September 7, 2016 through February 3, 2017.
|
(b)
|
Stock-based compensation expense before taxes for the fiscal year ended February 3, 2017 does not include $807 million of post-merger stock-based compensation expense and related taxes resulting from the EMC merger transaction. See Note 8 of the Notes to the Consolidated Financial Statements for more information on the EMC merger transaction.
|
|
Number of Options
|
|
Weighted-Average Exercise Price
|
|
Weighted-Average Remaining Contractual Term
|
|
Aggregate Intrinsic Value (a)
|
|||||
|
(in millions)
|
|
(per share)
|
|
(in years)
|
|
(in millions)
|
|||||
Options outstanding as of January 29, 2016
|
54
|
|
|
$
|
14.30
|
|
|
|
|
|
||
Granted
|
2
|
|
|
27.09
|
|
|
|
|
|
|||
Exercised
|
(1
|
)
|
|
14.12
|
|
|
|
|
|
|||
Forfeited
|
(7
|
)
|
|
15.51
|
|
|
|
|
|
|||
Canceled/expired
|
—
|
|
|
—
|
|
|
|
|
|
|||
Options outstanding as of February 3, 2017
|
48
|
|
|
14.75
|
|
|
|
|
|
|||
Granted
|
—
|
|
|
—
|
|
|
|
|
|
|||
Exercised
|
(4
|
)
|
|
14.62
|
|
|
|
|
|
|||
Forfeited
|
(2
|
)
|
|
13.75
|
|
|
|
|
|
|||
Canceled/expired
|
—
|
|
|
—
|
|
|
|
|
|
|||
Options outstanding as of February 2, 2018
|
42
|
|
|
14.80
|
|
|
|
|
|
|||
Granted
|
—
|
|
|
—
|
|
|
|
|
|
|||
Exercised
|
—
|
|
|
—
|
|
|
|
|
|
|||
Forfeited
|
—
|
|
|
—
|
|
|
|
|
|
|||
Canceled/expired
|
—
|
|
|
—
|
|
|
|
|
|
|||
Options outstanding as of February 1, 2019 (b)
|
42
|
|
|
$
|
14.76
|
|
|
4.8
|
|
$
|
1,453
|
|
Exercisable as of February 1, 2019
|
41
|
|
|
$
|
14.64
|
|
|
4.8
|
|
$
|
1,435
|
|
Vested and expected to vest (net of estimated forfeitures) as of February 1, 2019
|
42
|
|
|
$
|
14.75
|
|
|
4.8
|
|
$
|
1,452
|
|
(a)
|
The aggregate intrinsic values represent the total pre-tax intrinsic values based on the closing price of $49.65 of the Company’s Class C Common Stock as of February 1, 2019 that would have been received by the option holders had all in-the-money options been exercised as of that date.
|
(b)
|
Stock option activity during the period was immaterial. The ending weighted-average exercise price was calculated based on underlying options outstanding as of February 1, 2019. Of the 42 million stock options outstanding on February 1, 2019, 19 million related to performance-based awards and 23 million related to service-based awards.
|
|
Fiscal Year Ended
|
||
|
February 3, 2017
|
||
Weighted-average grant date fair value of stock options granted per option
|
$
|
10.36
|
|
Expected term (in years)
|
3.4
|
|
|
Risk-free rate (U.S. Government Treasury Note)
|
0.9
|
%
|
|
Expected volatility
|
51
|
%
|
|
Expected dividend yield
|
—
|
%
|
|
Fiscal Year Ended
|
||
|
February 3, 2017
|
||
Weighted-average grant date fair value of stock options granted per option
|
$
|
8.83
|
|
Expected term (in years)
|
—
|
|
|
Risk-free rate (U.S. Government Treasury Note)
|
1.7
|
%
|
|
Expected volatility
|
44
|
%
|
|
Expected dividend yield
|
—
|
%
|
|
Number of Units
|
|
Weighted-Average Grant Date Fair Value
|
|||
|
(in millions)
|
|
(per unit)
|
|||
Outstanding, January 29, 2016
|
—
|
|
|
$
|
—
|
|
Granted
|
11
|
|
|
19.66
|
|
|
Vested
|
—
|
|
|
—
|
|
|
Forfeited
|
(1
|
)
|
|
19.63
|
|
|
Outstanding, February 3, 2017
|
10
|
|
|
$
|
19.63
|
|
Granted
|
1
|
|
|
23.04
|
|
|
Vested
|
(1
|
)
|
|
27.59
|
|
|
Forfeited
|
(3
|
)
|
|
19.13
|
|
|
Outstanding, February 2, 2018
|
7
|
|
|
$
|
18.73
|
|
Granted (a)
|
—
|
|
|
—
|
|
|
Vested
|
(1
|
)
|
|
28.03
|
|
|
Forfeited
|
(1
|
)
|
|
17.88
|
|
|
Outstanding, February 1, 2019 (b)
|
5
|
|
|
$
|
18.90
|
|
(a)
|
The Company granted an immaterial number of restricted stock awards during the fiscal year ended February 1, 2019.
|
(b)
|
As of February 1, 2019, the 5 million units outstanding included 1 million RSUs and 4 million PSUs.
|
|
Number of Units
|
|
Weighted-Average Remaining Contractual Term
|
|
Aggregate Intrinsic Value (a)
|
|||
|
(in millions)
|
|
(in years)
|
|
(in millions)
|
|||
Expected to vest, February 1, 2019
|
5
|
|
|
2.3
|
|
$
|
224
|
|
(a)
|
The aggregate intrinsic value represents the total pre-tax intrinsic values based on the closing price of $49.65 of the Company’s Class C Common Stock as of February 1, 2019 that would have been received by the RSU holders had the RSUs been issued as of February 1, 2019.
|
|
Number of Options
|
|
Weighted-Average Exercise Price
|
|
Weighted-Average Remaining Contractual Term
|
|
Aggregate Intrinsic Value (a)
|
|||||
|
(in millions)
|
|
(per share)
|
|
(in years)
|
|
(in millions)
|
|||||
Options outstanding as of September 7, 2016
|
2
|
|
|
$
|
65.01
|
|
|
|
|
|
||
Granted
|
—
|
|
|
—
|
|
|
|
|
|
|||
Exercised
|
—
|
|
|
—
|
|
|
|
|
|
|||
Forfeited
|
—
|
|
|
—
|
|
|
|
|
|
|||
Canceled/expired
|
—
|
|
|
—
|
|
|
|
|
|
|||
Options outstanding as of February 3, 2017 (b)
|
2
|
|
|
69.38
|
|
|
|
|
|
|||
Granted
|
1
|
|
|
13.79
|
|
|
|
|
|
|||
Exercised
|
(1
|
)
|
|
53.50
|
|
|
|
|
|
|||
Forfeited
|
—
|
|
|
—
|
|
|
|
|
|
|||
Canceled/expired
|
—
|
|
|
—
|
|
|
|
|
|
|||
Options outstanding as of February 2, 2018
|
2
|
|
|
54.63
|
|
|
|
|
|
|||
Granted
|
1
|
|
|
16.07
|
|
|
|
|
|
|||
Adjustment for special cash dividend (c)
|
—
|
|
|
—
|
|
|
|
|
|
|||
Exercised
|
(1
|
)
|
|
46.73
|
|
|
|
|
|
|||
Forfeited
|
—
|
|
|
—
|
|
|
|
|
|
|||
Canceled/expired
|
—
|
|
|
—
|
|
|
|
|
|
|||
Options outstanding as of February 1, 2019 (c)
|
2
|
|
|
$
|
36.50
|
|
|
5.6
|
|
$
|
224
|
|
Exercisable as of February 1, 2019
|
1
|
|
|
$
|
55.49
|
|
|
3.2
|
|
$
|
103
|
|
Vested and expected to vest (net of estimated forfeitures) as of February 1, 2019
|
2
|
|
|
$
|
36.50
|
|
|
5.6
|
|
$
|
224
|
|
(a)
|
The aggregate intrinsic value represents the total pre-tax intrinsic values based on VMware, Inc.’s closing stock price of $150.51 as of February 1, 2019 that would have been received by the option holders had all in-the-money options been exercised as of that date.
|
(b)
|
Stock option activity during the period was immaterial. The ending weighted-average exercise price was calculated based on underlying options outstanding as of February 3, 2017.
|
(c)
|
The number of options and weighted-average exercise price of options outstanding as of February 1, 2019 reflect the non-cash adjustments to the options as a result of the special cash dividend.
|
|
Fiscal Year Ended
|
||||||
|
February 1, 2019
|
|
February 2, 2018
|
||||
VMware, Inc. 2007 Equity and Incentive Plan
|
|
|
|
||||
Weighted-average grant date fair value of stock options granted per option
|
$
|
143.01
|
|
|
$
|
83.62
|
|
Expected term (in years)
|
3.2
|
|
|
3.3
|
|
||
Risk-free rate (U.S. Government Treasury Note)
|
2.9
|
%
|
|
1.7
|
%
|
||
Expected volatility
|
32
|
%
|
|
29
|
%
|
||
Expected dividend yield
|
—
|
%
|
|
—
|
%
|
|
Fiscal Year Ended
|
|
September 7, 2016 through
|
||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
VMware, Inc. Employee Stock Purchase Plan
|
|
|
|
|
|
||||||
Weighted-average grant date fair value of stock options granted per option
|
$
|
34.72
|
|
|
$
|
21.93
|
|
|
$
|
13.57
|
|
Expected term (in years)
|
0.8
|
|
|
0.9
|
|
|
0.8
|
|
|||
Risk-free rate (U.S. Government Treasury Note)
|
2.0
|
%
|
|
1.2
|
%
|
|
0.5
|
%
|
|||
Expected volatility
|
33
|
%
|
|
23
|
%
|
|
38
|
%
|
|||
Expected dividend yield
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
Number of Units
|
|
Weighted-Average Grant Date Fair Value
|
|||
|
(in millions)
|
|
(per unit)
|
|||
Outstanding, September 7, 2016
|
22
|
|
|
$
|
67.01
|
|
Granted
|
2
|
|
|
79.81
|
|
|
Vested
|
(3
|
)
|
|
72.94
|
|
|
Forfeited
|
(1
|
)
|
|
69.19
|
|
|
Outstanding, February 3, 2017
|
20
|
|
|
$
|
67.41
|
|
Granted
|
8
|
|
|
93.84
|
|
|
Vested
|
(9
|
)
|
|
67.89
|
|
|
Forfeited
|
(2
|
)
|
|
72.68
|
|
|
Outstanding, February 2, 2018
|
17
|
|
|
$
|
78.62
|
|
Granted
|
7
|
|
|
146.61
|
|
|
Adjustment for special cash dividend
|
3
|
|
|
NA
|
|
|
Vested
|
(7
|
)
|
|
75.45
|
|
|
Forfeited
|
(2
|
)
|
|
86.90
|
|
|
Outstanding, February 1, 2019 (a)
|
18
|
|
|
$
|
90.06
|
|
(a)
|
As of February 1, 2019, the 18 million units outstanding included 17 million RSUs and 1 million PSUs. The above table includes RSUs issued for outstanding unvested RSUs in connection with business combinations. The weighted-average grant date fair value of outstanding RSU awards as of February 1, 2019 reflects the non-cash adjustments to the awards as a result of the special cash dividend.
|
|
Number of Units
|
|
Weighted-Average Remaining Contractual Term
|
|
Aggregate Intrinsic Value (a)
|
|||
|
(in millions)
|
|
(in years)
|
|
(in millions)
|
|||
Expected to vest, February 1, 2019
|
16
|
|
|
2.3
|
|
$
|
2,438
|
|
(a)
|
The aggregate intrinsic value represents the total pre-tax intrinsic values based on VMware, Inc.’s closing stock price of $150.51 as of February 1, 2019 that would have been received by the RSU holders had the RSUs been issued as of February 1, 2019.
|
•
|
For stock options to purchase Class C Common Stock subject to service requirements, the intrinsic value of the option is multiplied by the portion of the option for which services have been rendered. Upon exercise of the option, the amount in temporary equity represents the fair value of the Class C Common Stock.
|
•
|
For stock appreciation rights, RSUs, or RSAs, any of which stock award types are subject to service requirements, the fair value of the share is multiplied by the portion of the share for which services have been rendered.
|
•
|
For share-based arrangements that are subject to the occurrence of a contingent event, those amounts are not reclassified to temporary equity until the contingency has been satisfied. Contingent events include the achievement of performance-based metrics.
|
|
February 1, 2019
|
|
February 2, 2018
|
||||
|
(in millions)
|
||||||
Redeemable shares classified as temporary equity
|
$
|
1,196
|
|
|
$
|
384
|
|
|
|
|
|
||||
Issued and outstanding unrestricted common shares
|
3
|
|
|
3
|
|
||
Restricted stock units
|
1
|
|
|
—
|
|
||
Restricted stock awards
|
—
|
|
|
—
|
|
||
Outstanding stock options
|
31
|
|
|
15
|
|
|
Benefit Obligation
|
||
|
(in millions)
|
||
Benefit obligation as of September 7, 2016
|
$
|
590
|
|
Interest cost
|
8
|
|
|
Benefits paid
|
(11
|
)
|
|
Actuarial loss (gain)
|
(52
|
)
|
|
Benefit obligation as of February 3, 2017
|
535
|
|
|
Interest cost
|
21
|
|
|
Benefits paid
|
(24
|
)
|
|
Actuarial loss (gain)
|
14
|
|
|
Benefit obligation as of February 2, 2018
|
546
|
|
|
Interest cost
|
20
|
|
|
Benefits paid
|
(26
|
)
|
|
Actuarial loss (gain)
|
(16
|
)
|
|
Benefit obligation as of February 1, 2019
|
$
|
524
|
|
|
Plan Assets
|
||
|
(in millions)
|
||
Fair value of plan assets as of September 7, 2016
|
$
|
493
|
|
Actual return on plan assets
|
(12
|
)
|
|
Benefits paid
|
(11
|
)
|
|
Fair value of plan assets as of February 3, 2017
|
470
|
|
|
Actual return on plan assets
|
59
|
|
|
Benefits paid
|
(24
|
)
|
|
Fair value of plan assets as of February 2, 2018
|
505
|
|
|
Actual return on plan assets
|
(5
|
)
|
|
Benefits paid
|
(26
|
)
|
|
Fair value of plan assets as of February 1, 2019
|
$
|
474
|
|
|
Fiscal Year Ended
|
|
For the Period September 7, 2016 through February 3, 2017
|
||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
|||||||
|
(in millions)
|
||||||||||
Interest cost
|
$
|
20
|
|
|
$
|
21
|
|
|
$
|
8
|
|
Expected return on plan assets
|
(28
|
)
|
|
(30
|
)
|
|
(16
|
)
|
|||
Net periodic benefit
|
$
|
(8
|
)
|
|
$
|
(9
|
)
|
|
$
|
(8
|
)
|
|
February 1, 2019
|
|
February 2, 2018
|
||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||||||
Common collective trusts (a)
|
$
|
—
|
|
|
$
|
322
|
|
|
$
|
—
|
|
|
$
|
322
|
|
|
$
|
—
|
|
|
$
|
350
|
|
|
$
|
—
|
|
|
$
|
350
|
|
U.S. Treasury securities
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
7
|
|
||||||||
Corporate debt securities (b)
|
—
|
|
|
147
|
|
|
—
|
|
|
147
|
|
|
—
|
|
|
147
|
|
|
—
|
|
|
147
|
|
||||||||
Total
|
$
|
5
|
|
|
$
|
469
|
|
|
$
|
—
|
|
|
474
|
|
|
$
|
7
|
|
|
$
|
497
|
|
|
$
|
—
|
|
|
504
|
|
||
Plan payables, net of accrued interest and dividends (c)
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
1
|
|
||||||||||||||
Total, net
|
|
|
|
|
|
|
$
|
474
|
|
|
|
|
|
|
|
|
$
|
505
|
|
(a)
|
Common collective trusts are valued at the net asset value calculated by the fund manager based on the underlying investments and are classified within Level 2 of the fair value hierarchy.
|
(b)
|
Corporate debt securities are valued daily at the closing price reported in active U.S. financial markets and are classified within Level 2 of the fair value hierarchy.
|
(c)
|
Dividends, accrued interest, and net plan payables are not material to the plan assets and therefore have not been classified into the fair value hierarchy.
|
|
Target Allocation
|
|
Actual Allocation
|
|||||
|
February 1, 2019
|
|
February 1, 2019
|
|
February 2, 2018
|
|||
U.S. large capitalization equity securities
|
25
|
%
|
|
24
|
%
|
|
27
|
%
|
U.S. small capitalization equity securities
|
5
|
|
|
5
|
|
|
5
|
|
Foreign equity securities
|
7
|
|
|
6
|
|
|
7
|
|
U.S. long-duration fixed income securities
|
60
|
|
|
61
|
|
|
58
|
|
Below investment grade corporate fixed income securities
|
3
|
|
|
4
|
|
|
3
|
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Consolidated net revenue:
|
|
|
|
|
|
|
|
||||
Infrastructure Solutions Group
|
$
|
36,720
|
|
|
$
|
30,917
|
|
|
$
|
22,070
|
|
Client Solutions Group
|
43,196
|
|
|
39,218
|
|
|
36,509
|
|
|||
VMware
|
9,088
|
|
|
7,994
|
|
|
3,543
|
|
|||
Reportable segment net revenue
|
89,004
|
|
|
78,129
|
|
|
62,122
|
|
|||
Other businesses (a)
|
2,329
|
|
|
2,195
|
|
|
1,153
|
|
|||
Unallocated transactions (b)
|
(9
|
)
|
|
(15
|
)
|
|
41
|
|
|||
Impact of purchase accounting (c)
|
(703
|
)
|
|
(1,269
|
)
|
|
(1,152
|
)
|
|||
Total consolidated net revenue
|
$
|
90,621
|
|
|
$
|
79,040
|
|
|
$
|
62,164
|
|
|
|
|
|
|
|
||||||
Consolidated operating income (loss):
|
|
|
|
|
|
||||||
Infrastructure Solutions Group
|
$
|
4,151
|
|
|
$
|
3,068
|
|
|
$
|
2,920
|
|
Client Solutions Group
|
1,960
|
|
|
2,044
|
|
|
1,751
|
|
|||
VMware
|
2,989
|
|
|
2,809
|
|
|
1,516
|
|
|||
Reportable segment operating income
|
9,100
|
|
|
7,921
|
|
|
6,187
|
|
|||
Other businesses (a)
|
(174
|
)
|
|
(125
|
)
|
|
(42
|
)
|
|||
Unallocated transactions (b)
|
(72
|
)
|
|
(24
|
)
|
|
(198
|
)
|
|||
Impact of purchase accounting (c)
|
(820
|
)
|
|
(1,546
|
)
|
|
(2,266
|
)
|
|||
Amortization of intangibles
|
(6,138
|
)
|
|
(6,980
|
)
|
|
(3,681
|
)
|
|||
Transaction-related expenses (d)
|
(750
|
)
|
|
(502
|
)
|
|
(1,488
|
)
|
|||
Other corporate expenses (e)
|
(1,337
|
)
|
|
(1,160
|
)
|
|
(902
|
)
|
|||
Total consolidated operating loss
|
$
|
(191
|
)
|
|
$
|
(2,416
|
)
|
|
$
|
(2,390
|
)
|
(a)
|
Pivotal, Secureworks, RSA Security, Virtustream, and Boomi constitute “Other businesses” and do not meet the requirements for a reportable segment, either individually or collectively. The results of Other businesses are not material to the Company’s overall results.
|
(b)
|
Unallocated transactions includes long-term incentives, certain short-term incentive compensation expenses, and other corporate items that are not allocated to Dell Technologies’ reportable segments.
|
(c)
|
Impact of purchase accounting includes non-cash purchase accounting adjustments that are primarily related to the EMC merger transaction.
|
(d)
|
Transaction-related expenses includes acquisition, integration, and divestiture related costs, as well as the costs incurred in the Class V transaction.
|
(e)
|
Other corporate expenses includes goodwill impairment charges, severance, facility action costs, and stock-based compensation expense.
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Net revenue:
|
|
|
|
|
|
|
|||||
Infrastructure Solutions Group:
|
|
|
|
|
|
||||||
Servers and networking
|
$
|
19,953
|
|
|
$
|
15,533
|
|
|
$
|
12,973
|
|
Storage
|
16,767
|
|
|
15,384
|
|
|
9,097
|
|
|||
Total ISG net revenue
|
36,720
|
|
|
30,917
|
|
|
22,070
|
|
|||
Client Solutions Group:
|
|
|
|
|
|
||||||
Commercial
|
30,893
|
|
|
27,507
|
|
|
25,773
|
|
|||
Consumer
|
12,303
|
|
|
11,711
|
|
|
10,736
|
|
|||
Total CSG net revenue
|
43,196
|
|
|
39,218
|
|
|
36,509
|
|
|||
VMware:
|
|
|
|
|
|
||||||
Total VMware net revenue
|
9,088
|
|
|
7,994
|
|
|
3,543
|
|
|||
Total segment net revenue
|
$
|
89,004
|
|
|
$
|
78,129
|
|
|
$
|
62,122
|
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Net revenue:
|
|
|
|
|
|
|
|
|
|||
United States
|
$
|
42,803
|
|
|
$
|
38,528
|
|
|
$
|
30,966
|
|
Foreign countries
|
47,818
|
|
|
40,512
|
|
|
31,198
|
|
|||
Total net revenue
|
$
|
90,621
|
|
|
$
|
79,040
|
|
|
$
|
62,164
|
|
|
February 1, 2019
|
|
February 2, 2018
|
||||
|
(in millions)
|
||||||
Property, plant, and equipment, net:
|
|
|
|
||||
United States
|
$
|
4,058
|
|
|
$
|
4,093
|
|
Foreign countries
|
1,201
|
|
|
1,297
|
|
||
Total property, plant, and equipment, net
|
$
|
5,259
|
|
|
$
|
5,390
|
|
|
February 1, 2019
|
|
February 2, 2018
|
||||
|
(in millions)
|
||||||
Cash, cash equivalents, and restricted cash:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
9,676
|
|
|
$
|
13,942
|
|
Restricted cash - other current assets (a)
|
522
|
|
|
423
|
|
||
Restricted cash - other non-current assets (a)
|
42
|
|
|
13
|
|
||
Total cash, cash equivalents, and restricted cash
|
$
|
10,240
|
|
|
$
|
14,378
|
|
Accounts receivable, net:
|
|
|
|
||||
Gross accounts receivable
|
$
|
12,456
|
|
|
$
|
11,824
|
|
Allowance for doubtful accounts
|
(85
|
)
|
|
(103
|
)
|
||
Total accounts receivable, net
|
$
|
12,371
|
|
|
$
|
11,721
|
|
Inventories, net:
|
|
|
|
||||
Production materials
|
$
|
1,794
|
|
|
$
|
967
|
|
Work-in-process
|
702
|
|
|
514
|
|
||
Finished goods
|
1,153
|
|
|
1,197
|
|
||
Total inventories, net
|
$
|
3,649
|
|
|
$
|
2,678
|
|
Prepaid expenses:
|
|
|
|
||||
Total prepaid expenses (b)
|
$
|
795
|
|
|
$
|
1,016
|
|
Property, plant, and equipment, net:
|
|
|
|
||||
Computer equipment
|
$
|
5,219
|
|
|
$
|
5,085
|
|
Land and buildings
|
4,559
|
|
|
4,343
|
|
||
Machinery and other equipment
|
3,829
|
|
|
3,845
|
|
||
Total property, plant, and equipment
|
13,607
|
|
|
13,273
|
|
||
Accumulated depreciation and amortization (c)
|
(8,348
|
)
|
|
(7,883
|
)
|
||
Total property, plant, and equipment, net
|
$
|
5,259
|
|
|
$
|
5,390
|
|
Accrued and other current liabilities:
|
|
|
|
||||
Compensation
|
$
|
3,646
|
|
|
$
|
2,948
|
|
Warranty liability
|
355
|
|
|
367
|
|
||
Income and other taxes
|
1,396
|
|
|
1,229
|
|
||
Other
|
3,098
|
|
|
3,482
|
|
||
Total accrued and other current liabilities
|
$
|
8,495
|
|
|
$
|
8,026
|
|
Other non-current liabilities:
|
|
|
|
||||
Warranty liability
|
$
|
169
|
|
|
$
|
172
|
|
Deferred and other tax liabilities
|
5,527
|
|
|
6,590
|
|
||
Other
|
631
|
|
|
515
|
|
||
Total other non-current liabilities
|
$
|
6,327
|
|
|
$
|
7,277
|
|
(a)
|
Restricted cash includes cash required to be held in escrow pursuant to DFS securitization arrangements and VMware, Inc. restricted cash.
|
(b)
|
Prepaid expenses are included in other current assets in the Consolidated Statements of Financial Position.
|
(c)
|
During the fiscal years ended February 1, 2019, February 2, 2018, and February 3, 2017, the Company recognized $1.3 billion, $1.5 billion, and $1.2 billion, respectively, in depreciation expense. Additionally, during the fiscal years ended February 1, 2019 and February 2, 2018, the Company retired $0.8 billion and $1.1 billion, respectively, of fully depreciated property, plant, and equipment.
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Trade Receivables - Allowance for doubtful accounts:
|
|
|
|
|
|
||||||
Balance at beginning of period
|
$
|
103
|
|
|
$
|
57
|
|
|
$
|
36
|
|
Provision charged to income statement
|
77
|
|
|
60
|
|
|
43
|
|
|||
Bad debt write-offs
|
(95
|
)
|
|
(14
|
)
|
|
(22
|
)
|
|||
Balance at end of period
|
$
|
85
|
|
|
$
|
103
|
|
|
$
|
57
|
|
|
|
|
|
|
|
||||||
Customer Financing Receivables - Allowance for financing receivable losses:
|
|
|
|
|
|
||||||
Balance at beginning of period
|
$
|
145
|
|
|
$
|
143
|
|
|
$
|
176
|
|
Provision charged to income statement
|
95
|
|
|
103
|
|
|
75
|
|
|||
Charge-offs, net of recoveries (a)
|
(104
|
)
|
|
(101
|
)
|
|
(108
|
)
|
|||
Balance at end of period
|
$
|
136
|
|
|
$
|
145
|
|
|
$
|
143
|
|
|
|
|
|
|
|
||||||
Tax Valuation Allowance:
|
|
|
|
|
|
||||||
Balance at beginning of period
|
$
|
777
|
|
|
$
|
709
|
|
|
$
|
796
|
|
Charged to income tax provision
|
927
|
|
|
68
|
|
|
(496
|
)
|
|||
Allowance acquired
|
—
|
|
|
—
|
|
|
409
|
|
|||
Balance at end of period
|
$
|
1,704
|
|
|
$
|
777
|
|
|
$
|
709
|
|
(a)
|
Charge-offs to the allowance for financing receivable losses for customer financing receivables includes principal and interest.
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Warranty liability:
|
|
|
|
|
|
||||||
Warranty liability at beginning of period
|
$
|
539
|
|
|
$
|
604
|
|
|
$
|
574
|
|
Warranty liability assumed through EMC merger transaction
|
—
|
|
|
—
|
|
|
125
|
|
|||
Costs accrued for new warranty contracts and changes in estimates for pre-existing warranties (a) (b)
|
856
|
|
|
905
|
|
|
852
|
|
|||
Service obligations honored
|
(871
|
)
|
|
(970
|
)
|
|
(947
|
)
|
|||
Warranty liability at end of period
|
$
|
524
|
|
|
$
|
539
|
|
|
$
|
604
|
|
Current portion
|
$
|
355
|
|
|
$
|
367
|
|
|
$
|
405
|
|
Non-current portion
|
$
|
169
|
|
|
$
|
172
|
|
|
$
|
199
|
|
(a)
|
Changes in cost estimates related to pre-existing warranties are aggregated with accruals for new standard warranty contracts. The Company’s warranty liability process does not differentiate between estimates made for pre-existing warranties and new warranty obligations.
|
(b)
|
Includes the impact of foreign currency exchange rate fluctuations.
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Severance liability:
|
|
|
|
|
|
||||||
Severance liability at beginning of period
|
$
|
175
|
|
|
$
|
416
|
|
|
$
|
26
|
|
Severance liability assumed through EMC merger transaction
|
—
|
|
|
—
|
|
|
70
|
|
|||
Severance charges to provision
|
215
|
|
|
159
|
|
|
541
|
|
|||
Cash paid and other
|
(244
|
)
|
|
(400
|
)
|
|
(221
|
)
|
|||
Severance liability at end of period
|
$
|
146
|
|
|
$
|
175
|
|
|
$
|
416
|
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Severance charges:
|
|
|
|
|
|
||||||
Cost of net revenue
|
$
|
17
|
|
|
$
|
46
|
|
|
$
|
122
|
|
Selling, general, and administrative
|
146
|
|
|
46
|
|
|
355
|
|
|||
Research and development
|
52
|
|
|
67
|
|
|
64
|
|
|||
Total severance charges
|
$
|
215
|
|
|
$
|
159
|
|
|
$
|
541
|
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Interest and other, net:
|
|
|
|
|
|
||||||
Investment income, primarily interest
|
$
|
313
|
|
|
$
|
207
|
|
|
$
|
102
|
|
Gain (loss) on investments, net
|
342
|
|
|
72
|
|
|
4
|
|
|||
Interest expense
|
(2,488
|
)
|
|
(2,406
|
)
|
|
(1,751
|
)
|
|||
Foreign exchange
|
(206
|
)
|
|
(113
|
)
|
|
(77
|
)
|
|||
Debt extinguishment
|
—
|
|
|
—
|
|
|
(337
|
)
|
|||
Other
|
(131
|
)
|
|
(113
|
)
|
|
(45
|
)
|
|||
Total interest and other, net
|
$
|
(2,170
|
)
|
|
$
|
(2,353
|
)
|
|
$
|
(2,104
|
)
|
Dell Technologies Inc. (Parent)
|
February 1, 2019
|
|
February 2, 2018
|
||||
|
(in millions)
|
||||||
Assets:
|
|
|
|
||||
Other current assets
|
$
|
—
|
|
|
$
|
1
|
|
Investments in subsidiaries (a)
|
—
|
|
|
12,128
|
|
||
Other non-current assets
|
25
|
|
|
—
|
|
||
Total assets
|
$
|
25
|
|
|
$
|
12,129
|
|
Liabilities:
|
|
|
|
||||
Short-term debt (b)
|
13
|
|
|
—
|
|
||
Long-term debt (b)
|
—
|
|
|
26
|
|
||
Guarantees of subsidiary obligations (a)
|
4,581
|
|
|
—
|
|
||
Total liabilities
|
4,594
|
|
|
26
|
|
||
Redeemable shares
|
1,196
|
|
|
384
|
|
||
Stockholders’ equity (deficit):
|
|
|
|
||||
Common stock and capital in excess of $0.01 par value
|
16,051
|
|
|
18,449
|
|
||
Accumulated deficit
|
(21,349
|
)
|
|
(6,860
|
)
|
||
Accumulated other comprehensive income (loss)
|
(467
|
)
|
|
130
|
|
||
Total stockholders’ equity (deficit)
|
(5,765
|
)
|
|
11,719
|
|
||
Total liabilities, redeemable shares, and stockholders’ equity (deficit)
|
$
|
25
|
|
|
$
|
12,129
|
|
(a)
|
Due primarily to the $11 billion cash dividend paid by VMware Inc. in connection with the Class V transaction described in Note 14 of the Notes to the Consolidated Financial Statements, the investments in subsidiaries account was reduced to zero as of February 1, 2019. Guarantees of subsidiary obligations represents the capital Dell Technologies Inc. received in excess of the carrying amount of its investments in subsidiaries.
|
(b)
|
In connection with the acquisition of Dell by Dell Technologies Inc. in the going-private transaction, Dell Technologies Inc. issued a $2.0 billion subordinated note to Microsoft Global Finance, a subsidiary of Microsoft Corporation. As of February 1, 2019 and February 2, 2018, the outstanding principal amount of the Microsoft Note was $13 million and $26 million, respectively.
|
|
Fiscal Year Ended
|
||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Equity in net loss from continuing operations of subsidiaries attributable to Dell Technologies Inc.
|
$
|
(2,042
|
)
|
|
$
|
(2,844
|
)
|
|
$
|
(3,076
|
)
|
Equity in net income (loss) from discontinued operations of subsidiaries
|
—
|
|
|
—
|
|
|
1,916
|
|
|||
Equity in net loss of subsidiaries attributable to Dell Technologies Inc.
|
(2,042
|
)
|
|
(2,844
|
)
|
|
(1,160
|
)
|
|||
|
|
|
|
|
|
||||||
Parent - Total operating expense (a)
|
(273
|
)
|
|
—
|
|
|
—
|
|
|||
Parent - Interest and other, net (a)
|
(20
|
)
|
|
(2
|
)
|
|
(11
|
)
|
|||
Parent - Income tax expense (benefit) (a)
|
(25
|
)
|
|
3
|
|
|
(4
|
)
|
|||
Parent - Loss before equity in net income of subsidiaries
|
$
|
(268
|
)
|
|
$
|
(5
|
)
|
|
$
|
(7
|
)
|
|
|
|
|
|
|
||||||
Consolidated net loss attributable to Dell Technologies Inc.
|
(2,310
|
)
|
|
(2,849
|
)
|
|
(1,167
|
)
|
|||
Other comprehensive income (loss) of subsidiaries attributable to Dell Technologies Inc.
|
(539
|
)
|
|
725
|
|
|
(271
|
)
|
|||
Comprehensive loss attributable to Dell Technologies Inc.
|
$
|
(2,849
|
)
|
|
$
|
(2,124
|
)
|
|
$
|
(1,438
|
)
|
(a)
|
During the fiscal year ended February 1, 2019, the increase to expenses and the associated tax benefit was primarily related to the costs incurred in the Class V transaction.
|
|
Fiscal Year Ended
|
||||||||||
Dell Technologies Inc. (Parent)
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Change in cash from operating activities
|
$
|
(274
|
)
|
|
$
|
(2
|
)
|
|
$
|
(2
|
)
|
|
|
|
|
|
|
||||||
Cash flow from investing activities:
|
|
|
|
|
|
||||||
Transfer to/from subsidiary
|
14,360
|
|
|
640
|
|
|
35,941
|
|
|||
Acquisition of business, net of cash acquired
|
—
|
|
|
—
|
|
|
(39,521
|
)
|
|||
Change in cash from investing activities
|
14,360
|
|
|
640
|
|
|
(3,580
|
)
|
|||
|
|
|
|
|
|
||||||
Cash flow from financing activities:
|
|
|
|
|
|
||||||
Proceeds from the issuance of DHI Group Common Stock
|
—
|
|
|
—
|
|
|
4,422
|
|
|||
Shares repurchased for tax withholdings of equity awards
|
(28
|
)
|
|
(33
|
)
|
|
(6
|
)
|
|||
Repurchases of DHI Group Common Stock
|
(47
|
)
|
|
(6
|
)
|
|
(10
|
)
|
|||
Repurchases of Class V Common Stock
|
(14,000
|
)
|
|
(723
|
)
|
|
(701
|
)
|
|||
Repayments of debt
|
(13
|
)
|
|
—
|
|
|
—
|
|
|||
Other
|
2
|
|
|
1
|
|
|
—
|
|
|||
Change in cash from financing activities
|
(14,086
|
)
|
|
(761
|
)
|
|
3,705
|
|
|||
Change in cash, cash equivalents, and restricted cash
|
—
|
|
|
(123
|
)
|
|
123
|
|
|||
Cash, cash equivalents, and restricted cash at beginning of the period
|
—
|
|
|
123
|
|
|
—
|
|
|||
Cash, cash equivalents, and restricted cash at end of the period
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
123
|
|
|
Fiscal 2019
|
||||||||||||||
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4 (a)
|
||||||||
|
(in millions, except per share data)
|
||||||||||||||
Net revenue
|
$
|
21,356
|
|
|
$
|
22,942
|
|
|
$
|
22,482
|
|
|
$
|
23,841
|
|
Gross margin
|
$
|
5,878
|
|
|
$
|
6,123
|
|
|
$
|
5,943
|
|
|
$
|
7,109
|
|
|
|
|
|
|
|
|
|
||||||||
Net income from continuing operations attributable to Class V Common Stock
|
$
|
470
|
|
|
$
|
320
|
|
|
$
|
165
|
|
|
$
|
240
|
|
Net loss from continuing operations attributable to DHI Group
|
(1,106
|
)
|
|
(819
|
)
|
|
(1,041
|
)
|
|
(539
|
)
|
||||
Net loss from continuing operations attributable to Dell Technologies Inc.
|
$
|
(636
|
)
|
|
$
|
(499
|
)
|
|
$
|
(876
|
)
|
|
$
|
(299
|
)
|
Income (loss) from discontinued operations, net of income taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net loss attributable to Dell Technologies Inc.
|
$
|
(636
|
)
|
|
$
|
(499
|
)
|
|
$
|
(876
|
)
|
|
$
|
(299
|
)
|
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per share attributable to Dell Technologies Inc. - basic:
|
|
|
|
|
|
|
|
||||||||
Continuing operations - Class V Common Stock - basic
|
$
|
2.36
|
|
|
$
|
1.61
|
|
|
$
|
0.83
|
|
|
$
|
1.21
|
|
Continuing operations - DHI Group - basic
|
$
|
(1.95
|
)
|
|
$
|
(1.44
|
)
|
|
$
|
(1.84
|
)
|
|
$
|
(0.86
|
)
|
Discontinued operations - DHI Group - basic
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Earnings (loss) per share attributable to Dell Technologies Inc. - diluted:
|
|
|
|
|
|
|
|
||||||||
Continuing operations - Class V Common Stock - diluted
|
$
|
2.33
|
|
|
$
|
1.58
|
|
|
$
|
0.81
|
|
|
$
|
1.19
|
|
Continuing operations - DHI Group - diluted
|
$
|
(1.95
|
)
|
|
$
|
(1.45
|
)
|
|
$
|
(1.84
|
)
|
|
$
|
(0.86
|
)
|
Discontinued operations - DHI Group - diluted
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(a)
|
For the three months ended February 1, 2019, net income from continuing operations attributable to the Class V Common Stock represents net income attributable to the Class V Group from November 3, 2018 to December 27, 2018, the last date on which the Class V Common Stock was traded on the NYSE.
|
|
Fiscal 2018
|
||||||||||||||
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
||||||||
|
(in millions, except per share data)
|
||||||||||||||
Net revenue
|
$
|
18,000
|
|
|
$
|
19,521
|
|
|
$
|
19,556
|
|
|
$
|
21,963
|
|
Gross margin
|
$
|
4,457
|
|
|
$
|
4,968
|
|
|
$
|
5,220
|
|
|
$
|
5,892
|
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) from continuing operations attributable to Class V Common Stock
|
$
|
125
|
|
|
$
|
204
|
|
|
$
|
198
|
|
|
$
|
(196
|
)
|
Net income (loss) from continuing operations attributable to DHI Group
|
(1,296
|
)
|
|
(936
|
)
|
|
(1,044
|
)
|
|
96
|
|
||||
Net loss from continuing operations attributable to Dell Technologies Inc.
|
$
|
(1,171
|
)
|
|
$
|
(732
|
)
|
|
$
|
(846
|
)
|
|
$
|
(100
|
)
|
Income (loss) from discontinued operations, net of income taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net loss attributable to Dell Technologies Inc.
|
$
|
(1,171
|
)
|
|
$
|
(732
|
)
|
|
$
|
(846
|
)
|
|
$
|
(100
|
)
|
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per share attributable to Dell Technologies Inc. - basic:
|
|
|
|
|
|
|
|
||||||||
Continuing operations - Class V Common Stock - basic
|
$
|
0.60
|
|
|
$
|
1.00
|
|
|
$
|
0.98
|
|
|
$
|
(0.98
|
)
|
Continuing operations - DHI Group - basic
|
$
|
(2.29
|
)
|
|
$
|
(1.65
|
)
|
|
$
|
(1.84
|
)
|
|
$
|
0.17
|
|
Discontinued operations - DHI Group - basic
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Earnings (loss) per share attributable to Dell Technologies Inc. - diluted:
|
|
|
|
|
|
|
|
||||||||
Continuing operations - Class V Common Stock - diluted
|
$
|
0.59
|
|
|
$
|
1.00
|
|
|
$
|
0.96
|
|
|
$
|
(0.98
|
)
|
Continuing operations - DHI Group - diluted
|
$
|
(2.29
|
)
|
|
$
|
(1.66
|
)
|
|
$
|
(1.84
|
)
|
|
$
|
0.16
|
|
Discontinued operations - DHI Group - diluted
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
•
|
$1,000 million 4.00% First Lien Notes due 2024
|
•
|
$1,750 million 4.90% First Lien Notes due 2026
|
•
|
$1,750 million 5.30% First Lien Notes due 2029
|
•
|
Judgments in decision-making can be faulty, and control and process breakdowns can occur because of simple errors or mistakes.
|
•
|
Controls can be circumvented by individuals, acting alone or in collusion with each other, or by management override.
|
•
|
The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
|
•
|
Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with associated policies or procedures.
|
•
|
The design of a control system must reflect the fact that resources are constrained, and the benefits of controls must be considered relative to their costs.
|
Michael S. Dell
Chairman and Chief Executive Officer
Dell Technologies Inc.
|
William D. Green
Public Company Director
|
|
|
David W. Dorman
Founding Partner
Centerview Capital Technology
|
Ellen J. Kullman
Public Company Director
|
|
|
Egon Durban
Managing Partner and Managing Director
Silver Lake Partners
|
Simon Patterson
Managing Director
Silver Lake Partners
|
(1)
|
Financial Statements: The following financial statements are filed as part of this report under “Part II — Item 8 — Financial Statements and Supplementary Data”:
|
(2)
|
Financial Statement Schedules: The information required in the following financial statement schedules is included in Note 20 and Note 21 of the Notes to the Consolidated Financial Statements under “Part II — Item 8 — Financial Statements and Supplementary Data”:
|
Exhibit
Number
|
|
Description
|
|
||
|
||
|
||
|
||
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
101 .INS††
|
|
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††
|
|
XBRL Taxonomy Extension Schema Document.
|
101 .CAL††
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
101 .DEF††
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
101 .LAB††
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
101 .PRE††
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
†
|
|
Annexes, schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. Dell Technologies Inc. agrees to furnish supplementally a copy of any omitted attachment to the Securities and Exchange Commission on a confidential basis upon request.
|
††
|
|
Filed with this report.
|
†††
|
|
Furnished with this report.
|
*
|
|
Management contracts or compensation plans or arrangements in which directors or executive officers participate.
|
**
|
|
Pursuant to Item 601(b)(4)(iii) of Regulation S-K, copies of instruments defining the rights of holders of certain long-term debt of the Company and its subsidiaries are not filed. The Company agrees to furnish to the Securities and Exchange Commission, upon request, a copy of each instrument with respect to issuances of such long-term debt.
|
|
DELL TECHNOLOGIES INC.
|
|
|
|
|
|
By:
|
/s/ MICHAEL S. DELL
|
|
|
Michael S. Dell
|
|
|
Chairman and Chief Executive Officer
|
|
|
(Duly Authorized Officer)
|
|
|
|
Signature
|
|
Title
|
|
|
|
/s/ MICHAEL S. DELL
|
|
Chairman and Chief Executive Officer
|
Michael S. Dell
|
|
(principal executive officer)
|
|
|
|
/s/ DAVID W. DORMAN
|
|
Director
|
David W. Dorman
|
|
|
|
|
|
/s/ EGON DURBAN
|
|
Director
|
Egon Durban
|
|
|
|
|
|
/s/ WILLIAM D. GREEN
|
|
Director
|
William D. Green
|
|
|
|
|
|
/s/ ELLEN J. KULLMAN
|
|
Director
|
Ellen J. Kullman
|
|
|
|
|
|
/s/ SIMON PATTERSON
|
|
Director
|
Simon Patterson
|
|
|
|
|
|
/s/ THOMAS W. SWEET
|
|
Executive Vice President and Chief Financial Officer
|
Thomas W. Sweet
|
|
(principal financial officer)
|
|
|
|
/s/ MAYA MCREYNOLDS
|
|
Senior Vice President, Corporate Finance and
|
Maya McReynolds
|
|
Chief Accounting Officer
|
|
|
(principal accounting officer)
|
|
|
|
|
|
|
•
|
Annual Board Retainer: $300,000, payable as follows:
|
⎯
|
$75,000 in cash (the “Annual Cash Retainer”), unless the independent non-employee director (hereafter, a “director”) makes a timely election to receive all or a portion of the Annual Cash Retainer in the form of deferred stock units over Class C common stock of the Company (“Class C Shares,” and such units, “DSUs”) (subject to the limitations described below), and
|
⎯
|
$225,000 (the “Annual Stock Retainer”), as follows:
|
o
|
50% in options to purchase Class C Shares (“Options”); and
|
o
|
50% in restricted stock units that settle in Class C Shares (“DTAs”);
|
•
|
Committee Chair Retainers: $25,000, all payable in cash unless the director makes a timely election to receive such payment in DSUs (subject to the limitations described below), in which case the director shall receive DSUs in lieu of such cash payment.
|
•
|
Sign-On Equity Grant: $1,000,000, paid in Options.
|
•
|
All of the foregoing equity-based awards will be granted under the Dell Technologies Inc. 2013 Stock Incentive Plan, as amended and restated from time to time (the “Plan”), with the Sign-On Equity Grant being made as soon as practicable after the director becomes a board member, and with all other awards being granted annually. The Sign-On Equity Grant vests annually in equal installments over four years from the date of grant with full acceleration of outstanding Options subject thereto in the event of death, permanent disability, termination without Cause, or a Change in Control, as Cause and Change in Control are defined in the Plan. The other equity awards are subject to vesting as described below.
|
•
|
Generally: An election must be made prior to the beginning of the calendar year to which it relates.
|
•
|
New directors: Each new director may make an election within 30 days after becoming a director, but this election will only apply to the portion of the Annual Board Retainer, Committee Chair Retainer (if applicable) or DTA grant earned after the date of the election.
|
•
|
Once the calendar year to which an election relates commences, the election is irrevocable with respect to that year. A director may submit a new election for each subsequent calendar year prior to the beginning of that calendar year (and, if no new election is submitted, the current election will remain in effect for subsequent years as provided in the election form).
|
•
|
Directors may elect the form of payment of their compensation on an individual basis.
|
•
|
Elections must be made in multiples as follows:
|
⎯
|
Allocation of the Annual Cash Retainer between DSUs and cash must be made in multiples of 25%.
|
⎯
|
Allocation of the DTA portion of the Annual Stock Retainer to DSUs must be made in multiples of 25%.
|
⎯
|
Election to receive DSUs (in lieu of cash) for a Committee Chair Retainer must be made in multiples of 25%.
|
Payment
Form
|
Maximum Allocation
|
Payment
Timing /Transfer Restrictions
|
Vesting+
|
Default Form of Payment?
|
Cash
|
$75,000
|
Lump sum following annual shareholders meeting. A director appointed other than pursuant to election at the annual meeting shall be entitled to pro-rated payment of the annual retainer fee for the partial year of service, payable in a lump sum upon his or her commencement of service on the Board.
|
Not applicable
|
Yes
(for $75,000 of the $300,000 retainer)
|
DTAs
|
$112,500*
|
Granted on or after the date of the Company’s annual shareholders meeting and settling in Class C Shares following vesting. A director appointed other than pursuant to election at the annual meeting shall be entitled to the pro-rated portion of the annual DTA grant for the partial year of service, payable on or after his or her commencement of service on the Board.
The Class C Shares received in settlement of the DTAs are subject to certain transfer restrictions as set forth in the Company’s Amended and Restated Management Stockholders Agreement (the “MSA”).
|
Cliff vesting after one year
|
Yes
(for $112,500 of the $300,000 retainer)
|
Options
|
$112,500*
|
Granted on or after the date of the Company’s annual shareholders meeting and exercisable for the underlying Class C Shares when vested. A director appointed other than pursuant to election at the annual meeting shall be entitled to the pro-rated portion of the annual
Option grant for the partial year of service, payable on or after his or her commencement of service on the Board.
The Class C Shares acquired upon exercise are subject to certain transfer restrictions as set forth in the MSA.
|
Cliff vesting after one year
|
Yes
(for $112,500 of the $300,000 retainer)
|
DSUs
|
$187,500*
|
Granted on or after the date of the Company’s annual shareholders meeting (or, if a director is appointed other than pursuant to election at the annual meeting, at a time following such appointment determined by the Board that is compliant with Internal Revenue Code Section 409A) and settled in Class C Shares on the earlier of (i) the termination of service as a director for any reason and (ii) a Change in Control (as defined in the Plan) that also constitutes a “change in control event” under Internal Revenue Code Section 409A regulations.
|
Cliff vesting after one year.
|
No
(Director may elect to receive all or a portion of the Annual Cash Retainer and the DTAs as DSUs)
|
⎯
|
Vesting of unvested awards is fully accelerated in event of death, permanent disability or a termination without Cause (as defined in the Plan).
|
⎯
|
All unvested equity awards are forfeited upon termination for Cause (as defined in the Plan).
|
⎯
|
Vested Options will remain exercisable until the earliest of (i) the nine-month anniversary of the date of termination, (ii) the expiration of the Option’s 10-year term and (iii) the date on which the director is terminated for Cause (as defined in the Plan).
|
Payment
Form
|
Maximum Allocation
|
Payment Timing
|
Vesting+
|
Default Form of Payment?
|
Cash
|
100%
|
Lump sum following annual meeting.
|
Not applicable
|
Yes
|
DSUs
|
100%
|
Settled in Class C Shares on the earlier of (i) the termination of service as a director for any reason and (ii) a Change in Control (as defined in the Plan) that also constitutes a “change in control event” under Internal Revenue Code Section 409A regulations.
|
Cliff vesting after one year*
|
No
(Director may elect to receive all or a portion of the Committee Chair Retainer as DSUs)
|
Company Name
|
Country
|
3401 Hillview LLC
|
United States
|
900 West Park Drive LLC
|
United States
|
A.W.S. Holding, LLC
|
United States
|
AetherPal (INDIA) Private Limited
|
India
|
AetherPal Inc.
|
United States
|
AirWatch LLC
|
United States
|
Arkinnet Software Private Limited
|
India
|
ASAP Software Express Inc
|
United States
|
Boomi LE UK Limited
|
United Kingdom
|
Boomi, Inc.
|
United States
|
Bracknell Boulevard (Block C) LLC
|
United States
|
Bracknell Boulevard (Block D) LLC
|
United States
|
Bracknell Boulevard Management Company Limited
|
United Kingdom
|
Branch of Dell (Free Zone Company L.L.C)
|
Saudi Arabia
|
CloudHealth Technologies (Singapore) Pte. Ltd.
|
Singapore
|
CloudHealth Technologies Australia Pty. Ltd.
|
Australia
|
CloudHealth Technologies France SARL
|
France
|
CloudHealth Technologies Germany GmbH
|
Germany
|
CloudHealth Technologies UK Ltd.
|
United Kingdom
|
CloudHealth Technologies, LLC
|
United States
|
Conchango Limited
|
United Kingdom
|
Credant Technologies International, Inc.
|
United States
|
Credant Technologies, Inc.
|
United States
|
Data Domain International III LLC
|
United States
|
Data Domain LLC
|
United States
|
Data General International Inc.
|
United States
|
DCC Executive Security Inc.
|
United States
|
Dell (Chengdu) Company Limited
|
China
|
Dell (China) Company Limited
|
China
|
Dell (China) Company Limited - Beijing Branch
|
China
|
Dell (China) Company Limited - Beijing Information Technology Branch Office
|
China
|
Dell (China) Company Limited - Dalian Branch
|
China
|
Dell (China) Company Limited - Guangzhou Branch
|
China
|
Dell (China) Company Limited - Hang Zhou Liaison Office
|
China
|
Dell (China) Company Limited - Nanjing Liaison Office
|
China
|
Dell (China) Company Limited - Shanghai Branch
|
China
|
Dell (China) Company Limited - Shen Zhen Liaison Office
|
China
|
Dell (China) Company Limited - Shenzhen Branch
|
China
|
Dell (China) Company Limited - Xiamen Branch
|
China
|
Dell (PS) Limited
|
Ireland
|
Dell (Switzerland) GmbH
|
Switzerland
|
Dell (Xiamen) Company Limited
|
China
|
Dell (Xiamen) Company Limited - Dalian Branch
|
China
|
Dell A/S
|
Denmark
|
Dell AB
|
Sweden
|
Dell America Latina Corp, Argentina Branch
|
Argentina
|
Dell America Latina Corp.
|
United States
|
Dell AS
|
Norway
|
Dell Asia Holdings Pte. Ltd.
|
Singapore
|
Dell Asia Pacific Sdn. Bhd.
|
Malaysia
|
Dell Asset Revolving Trust-B
|
United States
|
Dell Asset Syndication L.L.C.
|
United States
|
Dell Australia Holding Pty Ltd
|
Australia
|
Dell Australia Pty Limited
|
Australia
|
Dell B.V.
|
Netherlands
|
Dell B.V., Taiwan Branch
|
Taiwan
|
Dell Bank International Designated Activity Company
|
Ireland
|
Dell Bank International Designated Activity Company, Sucursal en España
|
Spain
|
Dell Canada Inc.
|
Canada
|
Dell Colombia Inc
|
United States
|
Dell Colombia Inc - Colombia Branch
|
Colombia
|
Dell Computadores do Brasil - Curitiba Branch
|
Brazil
|
Dell Computadores do Brasil - Hortolandia/SP Branch (A)
|
Brazil
|
Dell Computadores do Brasil - Hortolandia/SP Branch (B)
|
Brazil
|
Dell Computadores do Brasil - Porto Alegre Branch
|
Brazil
|
Dell Computadores do Brasil - Sao Paulo Branch (Avenida Prestes Maia)
|
Brazil
|
Dell Computadores do Brasil - Sao Paulo Branch (Rua James Joule)
|
Brazil
|
Dell Computadores do Brasil - Sao Paulo Branch (Rua Verbo Divino)
|
Brazil
|
Dell Computadores do Brasil Ltda.
|
Brazil
|
Dell Computer (Pty) Limited
|
South Africa
|
DELL Computer , spol. s r.o.
|
Czech Republic
|
Dell Computer De Chile Ltda.
|
Chile
|
Dell Computer EEIG
|
United Kingdom
|
Dell Computer Holdings L.P.
|
United States
|
Dell Computer SA
|
Spain
|
Dell Computer Services de Mexico S.A. de C.V.
|
Mexico
|
Dell Conduit Funding-B L.L.C.
|
United States
|
Dell Conduit Funding-C L.L.C.
|
United States
|
Dell Corporation (Thailand) Co., Ltd.
|
Thailand
|
Dell Corporation Limited
|
United Kingdom
|
Dell Costa Rica SA
|
Costa Rica
|
Dell Depositor L.L.C.
|
United States
|
Dell DFS Corporation
|
United States
|
Dell DFS Group Holdings L.L.C.
|
United States
|
Dell DFS Holdings Kft
|
Hungary
|
Dell DFS Holdings LLC
|
United States
|
Dell Direct
|
Ireland
|
Dell El Salvador, Limitada
|
El Salvador
|
Dell Emerging Markets (EMEA) Limited
|
United Kingdom
|
Dell Emerging Markets (EMEA) Limited
|
Jordan
|
Dell Emerging Markets (EMEA) Limited
|
Tunisia
|
Dell Emerging Markets (EMEA) Limited - Egypt Representative Office
|
Egypt
|
Dell Emerging Markets (EMEA) Limited - Representative Office
|
Lebanon
|
Dell Emerging Markets (EMEA) Limited (Kazakhstan Representative Office)
|
Kazakhstan
|
Dell Emerging Markets (EMEA) Limited (Kenya Branch)
|
Kenya
|
Dell Emerging Markets (EMEA) Limited (Uganda Representative Office)
|
Uganda
|
Dell Emerging Markets (EMEA) Limited External Company (Ghana)
|
Ghana
|
Dell Emerging Markets (EMEA) Limited Trade Representative Office (Bulgaria)
|
Bulgaria
|
DELL EMERGING MARKETS (EMEA) LIMITED za usluge, Podružnica Zagreb
|
Croatia
|
Dell Equipment Finance Trust 2014-1
|
United States
|
Dell Equipment Finance Trust 2015-1
|
United States
|
Dell Equipment Finance Trust 2015-2
|
United States
|
Dell Equipment Finance Trust 2016-1
|
United States
|
Dell Equipment Finance Trust 2017-1
|
United States
|
Dell Equipment Finance Trust 2017-2
|
United States
|
Dell Equipment Finance Trust 2018-1
|
United States
|
Dell Equipment Finance Trust 2018-2
|
United States
|
Dell Equipment Finance Trust 2019-1
|
United States
|
Dell Equipment Funding LP
|
United States
|
Dell Equipment GP LLC
|
United States
|
Dell Federal Systems Corporation
|
United States
|
Dell Federal Systems GP L.L.C.
|
United States
|
Dell Federal Systems L.P.
|
United States
|
Dell Federal Systems LP L.L.C.
|
United States
|
Dell Financial Services Canada Limited
|
Canada
|
Dell Financial Services L.L.C.
|
United States
|
Dell Financial Services Pty Ltd
|
Australia
|
Dell Financial Services Pty Ltd
|
New Zealand
|
Dell Funding L.L.C.
|
United States
|
Dell FZ-LLC
|
United Arab Emirates
|
Dell FZ-LLC - Abu Dhabi Branch
|
United Arab Emirates
|
Dell FZ-LLC - BAHRAIN BRANCH
|
Bahrain
|
Dell FZ-LLC - Dubai Branch
|
United Arab Emirates
|
Dell FZ-LLC - Qatar Branch
|
Qatar
|
Dell Gesellschaft m.b.H
|
Austria
|
Dell Global B.V.
|
Netherlands
|
Dell Global B.V. - Bangladesh Liaison Office
|
Bangladesh
|
Dell Global B.V. - Pakistan Liaison Office
|
Pakistan
|
Dell Global B.V. - Philippines Representative Office
|
Philippines
|
Dell Global B.V. - Sri Lanka Liaison / Representative Office
|
Sri Lanka
|
Dell Global B.V. (Singapore Branch)
|
Singapore
|
Dell Global Business Center Sdn. Bhd.
|
Malaysia
|
Dell Global Holdings III B.V.
|
Netherlands
|
Dell Global Holdings L.L.C.
|
United States
|
Dell Global Holdings VII LLC
|
United States
|
Dell Global Holdings X L.L.C.
|
United States
|
Dell Global Holdings XII L.L.C.
|
United States
|
Dell Global Holdings XIV L.L.C.
|
United States
|
Dell Global Holdings XV L.L.C.
|
United States
|
Dell GmbH
|
Germany
|
Dell GmbH - Munich Branch
|
Germany
|
Dell Guatemala, Ltda.
|
Guatemala
|
Dell Hong Kong Limited
|
Hong Kong
|
Dell Hungary Technology Solutions Trade LLC
|
Hungary
|
Dell III - Comercio de Computadores, Unipessoal Lda
|
Portugal
|
Dell Inc.
|
United States
|
Dell Information Technology (Kunshan) Company Limited
|
China
|
Dell International Holdings IX B.V.
|
Netherlands
|
Dell International Holdings Kft
|
Hungary
|
Dell International Holdings Limited
|
United Kingdom
|
Dell International Holdings SAS
|
France
|
Dell International Holdings VIII B.V.
|
Netherlands
|
Dell International Inc. (Korea)
|
Korea, Republic of
|
Dell International L.L.C.
|
United States
|
Dell International Services India Private Limited
|
India
|
Dell International Services Philippines, Inc.
|
Philippines
|
Dell Japan Inc
|
Japan
|
Dell Latinoamerica, S. de R.L.
|
Panama
|
Dell Leasing Mexico S. de RL de C.V.
|
Mexico
|
Dell Leasing Mexico Services S. de. R.L. de C.V.
|
Mexico
|
Dell LLC
|
Russian Federation
|
Dell Marketing Corporation
|
United States
|
Dell Marketing GP L.L.C.
|
United States
|
Dell Marketing L.P.
|
United States
|
Dell Marketing LP L.L.C.
|
United States
|
Dell Mexico S.A. de C.V.
|
Mexico
|
Dell Morocco SAS
|
Morocco
|
Dell New Zealand Limited
|
New Zealand
|
Dell NV
|
Belgium
|
Dell Panama S de RL
|
Panama
|
Dell Peru S.A.C.
|
Peru
|
Dell Procurement (Xiamen) Company Limited
|
China
|
Dell Procurement (Xiamen) Company Limited - Shanghai Branch
|
China
|
Dell Procurement (Xiamen) Company Limited - Shenzhen Branch
|
China
|
Dell Procurement (Xiamen) Company Limited - Shenzhen Liaison Office
|
China
|
Dell Product and Process Innovation Services Corp.
|
United States
|
Dell Products
|
Ireland
|
Dell Products (Poland) Sp.z.o.o.
|
Poland
|
Dell Products Corporation
|
United States
|
Dell Products GP LLC
|
United States
|
Dell Products L.P.
|
United States
|
Dell Products LP L.L.C.
|
United States
|
Dell Protective Services Inc.
|
United States
|
Dell Puerto Rico Corp.
|
Puerto Rico
|
Dell Receivables Corporation
|
United States
|
Dell Receivables GP LLC
|
United States
|
Dell Receivables L.P.
|
United States
|
Dell Receivables LP LLC
|
United States
|
Dell Revolver Company L.P.
|
United States
|
Dell Revolver Funding L.L.C.
|
United States
|
Dell Revolver GP L.L.C.
|
United States
|
Dell Revolving Transferor L.L.C.
|
United States
|
Dell S.à r.l
|
Luxembourg
|
Dell S.p.A.
|
Italy
|
Dell s.r.o.
|
Slovakia
|
Dell SA
|
France
|
Dell SA
|
Switzerland
|
Dell Sales Malaysia Sdn. Bhd.
|
Malaysia
|
Dell SAS
|
Morocco
|
Dell Services (China) Company Limited
|
China
|
Dell Services (China) Company Limited - Beijing Consulting Branch
|
China
|
Dell Services (China) Company Limited - Shanghai Branch
|
China
|
Dell Services GmbH
|
Germany
|
Dell Singapore Pte. Ltd.
|
Singapore
|
Dell Sp. z o.o.
|
Poland
|
Dell Systems (UK) Limited
|
United Kingdom
|
Dell Systems Applications Solutions, Inc.
|
United States
|
Dell Systems TSI (Hungary) Likviditásmenedzsment Korlátolt Felelısségő Társaság
|
Hungary
|
Dell Taiwan B.V.
|
Netherlands
|
Dell Taiwan B.V., Taiwan Branch
|
Taiwan
|
Dell Technologies Inc.
|
United States
|
Dell Technology & Solutions Israel Ltd
|
Israel
|
Dell Technology & Solutions LLC
|
Qatar
|
Dell Technology & Solutions Nigeria Limited
|
Nigeria
|
Dell Technology Products And Services SA
|
Greece
|
Dell Technology S.R.L.
|
Romania
|
Dell Teknoloji Limited Sirketi
|
Turkey
|
Dell Teknoloji Limited Sirketi - Ankara Branch
|
Turkey
|
Dell Trading (Kunshan) Company Limited
|
China
|
Dell USA Corporation
|
United States
|
Dell USA GP L.L.C.
|
United States
|
Dell USA L.P.
|
United States
|
Dell USA LP LLC
|
United States
|
Dell Vendor Finance Facility 2017 L.L.C.
|
United States
|
Dell World Trade Corporation
|
United States
|
Dell World Trade GP L.L.C.
|
United States
|
Dell World Trade L.P.
|
United States
|
Dell World Trade LP L.L.C.
|
United States
|
Denali Finance Corp.
|
United States
|
Denali Intermediate Inc.
|
United States
|
DFS B.V.
|
Netherlands
|
DIH VII C.V.
|
Netherlands
|
DIH VIII C.V.
|
Netherlands
|
DIH X C.V.
|
Netherlands
|
DIH XI C.V.
|
Netherlands
|
ECM Software Group Limited
|
Cyprus
|
EMC (Benelux) B.V.
|
Netherlands
|
EMC Australia Pty Limited
|
Australia
|
EMC Brasil Serviços De Ti LTDA.
|
Brazil
|
EMC Brasil Serviços De Ti LTDA. - Rio de Janeiro/RJ Branch
|
Brazil
|
EMC Brasil Serviços De Ti LTDA. - Sau Paulo/SP Branch
|
Brazil
|
EMC Chile S.A.
|
Chile
|
EMC Computer Storage Systems (Sales & Services) Ltd.
|
Israel
|
EMC Computer Systems
|
Qatar
|
EMC Computer Systems (Benelux) B.V.
|
Netherlands
|
EMC Computer Systems (China) Co., Ltd.
|
China
|
EMC Computer Systems (China) Co., Ltd. - Changsha Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Chengdu Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Chongqing Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Fuzhou Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Guangzhou Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Hangzhou Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Hefei Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Jinan Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Kunming Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Nanjing Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Nanning Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Qingdao Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Shanghai Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Shenyang Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Shenzhen Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Shenzhen Futian Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Urumqi Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Wuhan Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Xian Branch Office
|
China
|
EMC Computer Systems (China) Co., Ltd. - Zhengzhou Branch Office
|
China
|
EMC Computer Systems (FE) Limited
|
Hong Kong
|
EMC Computer Systems (FE) Limited, Macau Representative Office
|
Macao
|
EMC Computer Systems (FE) Limited, Taiwan Branch
|
Taiwan
|
EMC Computer Systems (Malaysia) Sdn. Bhd.
|
Malaysia
|
EMC Computer Systems (S A) (Pty) Ltd
|
South Africa
|
EMC Computer Systems (South Asia) Pte. Ltd.
|
Singapore
|
EMC Computer Systems (South Asia) Pte. Ltd. - Bangladesh Liaison Office
|
Bangladesh
|
EMC Computer Systems (South Asia) Pte. Ltd. (Myanmar Branch)
|
Myanmar
|
EMC Computer Systems (U.K.) Limited
|
United Kingdom
|
EMC Computer Systems AG
|
Switzerland
|
EMC Computer Systems Argentina S.A.
|
Argentina
|
EMC Computer Systems Austria GmbH
|
Austria
|
EMC Computer Systems Austria GmbH (“Rep Office in Egypt”)
|
Egypt
|
EMC Computer Systems Austria GmbH - Abu Dhabi
|
United Arab Emirates
|
EMC Computer Systems Austria GmbH – Representative Office Skopje
|
Macedonia
|
EMC Computer Systems Austria GmbH ("Ghana External Company")
|
Ghana
|
EMC Computer Systems Austria GmbH ("Rep Office in Bahrain")
|
Bahrain
|
EMC Computer Systems Austria GmbH ("Rep Office in Jordan")
|
Jordan
|
EMC Computer Systems Austria GmbH ("Saudi Arabia" branch)
|
Saudi Arabia
|
EMC Computer Systems Austria GmbH (“Branch in Kenya”)
|
Kenya
|
EMC Computer Systems Austria GmbH atstovybė ("Representative Office in Lithuania")
|
Lithuania
|
EMC Computer Systems Austria GmbH Eesti filiaal
|
Estonia
|
EMC Computer Systems Austria GmbH, organizacna zlozka
|
Slovakia
|
EMC Computer Systems Austria GmbH, podruznica Ljubljana
|
Slovenia
|
EMC Computer Systems Bilgisayar Sistemleri Ticaret A.S.
|
Turkey
|
EMC Computer Systems Brasil Ltda.
|
Brazil
|
EMC Computer Systems Brasil Ltda. – Barueri Branch (Alameda Rio Negro 161)
|
Brazil
|
EMC Computer Systems Brasil Ltda. – Barueri Branch (Tamboré 1180)
|
Brazil
|
EMC Computer Systems Brasil Ltda. – Brasilia Branch
|
Brazil
|
EMC Computer Systems Brasil Ltda. – Eldorado Branch
|
Brazil
|
EMC Computer Systems Brasil Ltda. – Rio de Janeiro Branch (Américas 3443)
|
Brazil
|
EMC Computer Systems Brasil Ltda. – Rio de Janeiro Branch (Rua Paulo Enídio Barbosa )
|
Brazil
|
EMC Computer Systems Brasil Ltda. – Sao Paulo Branch (Embaixador Macedo Soares 10735)
|
Brazil
|
EMC Computer Systems Brasil Ltda. – São Paulo Branch (Rua Verbo Divino 1488)
|
Brazil
|
EMC Computer Systems Danmark A/S
|
Denmark
|
EMC Computer Systems France S.A.S.
|
France
|
EMC Computer Systems Italia S.p.A.
|
Italy
|
EMC Computer Systems Mexico, S.A. de CV
|
Mexico
|
EMC Computer Systems Philippines, Inc.
|
Philippines
|
EMC Computer Systems Poland Sp. z o.o.
|
Poland
|
EMC Computer Systems Spain, S.A. - Sucursal Portugal
|
Portugal
|
EMC Computer Systems Spain, S.A.U.
|
Spain
|
EMC Computer Systems Venezuela, S.A.
|
Venezuela, Bolivarian Republic of
|
EMC Computer-Systems AS
|
Norway
|
EMC Computer-Systems OY
|
Finland
|
EMC Consulting (UK) Limited
|
United Kingdom
|
EMC Corporation
|
United States
|
EMC Corporation of Canada
|
Canada
|
EMC Czech Republic s.r.o.
|
Czech Republic
|
EMC del Peru, S.A.
|
Peru
|
EMC Egypt Service Center Limited
|
Egypt
|
EMC Equity Assets LLC
|
United States
|
EMC Europe Limited
|
United Kingdom
|
EMC Global Holdings Company
|
United States
|
EMC Global Holdings Company
|
Australia
|
EMC Group 2
|
Bermuda
|
EMC Hungary Trading and Servicing Ltd.
|
Hungary
|
EMC Information System Egypt Limited LTD
|
Egypt
|
EMC Information Systems (Thailand) Limited
|
Thailand
|
EMC Information Systems CIS
|
Russian Federation
|
EMC Information Systems Colombia Ltda.
|
Colombia
|
EMC Information Systems International
|
Ireland
|
EMC Information Systems Kazakhstan LLP
|
Kazakhstan
|
EMC Information Systems Management Limited
|
Ireland
|
EMC Information Systems Management Limited
|
France
|
EMC Information Systems Management Limited
|
Hong Kong
|
EMC Information Systems Management Limited Singapore Branch
|
Singapore
|
EMC Information Systems Management Limited, German Branch
|
Germany
|
EMC Information Systems Morocco Limited
|
Morocco
|
EMC Information Systems N.V.
|
Belgium
|
EMC Information Systems Nigeria Limited
|
Nigeria
|
EMC Information Systems Pakistan (Private) Limited
|
Pakistan
|
EMC Information Systems Sweden AB
|
Sweden
|
EMC Information Technology Research & Development (Beijing) Co., Ltd.
|
China
|
EMC Information Technology Research & Development (Chengdu) Co., Ltd.
|
China
|
EMC Information Technology Research & Development (Shanghai) Co., Ltd.
|
China
|
EMC International Company
|
Ireland
|
EMC International U.S. Holdings L.L.C.
|
United States
|
EMC Investment Corporation
|
United States
|
EMC IP Holding Company LLC
|
United States
|
EMC Ireland Holdings
|
Ireland
|
EMC Israel Advanced Information Technologies Ltd.
|
Israel
|
EMC Israel Development Center Ltd.
|
Israel
|
EMC IT Solutions India Private Limited
|
India
|
EMC Japan K.K.
|
Japan
|
EMC Luxembourg S.à.r.l.
|
Luxembourg
|
EMC Mexico Servicios, S.A. de C.V.
|
Mexico
|
EMC Middle East
|
United Arab Emirates
|
EMC New Zealand Corporation Limited
|
New Zealand
|
EMC Puerto Rico, Inc.
|
United States
|
EMC Research and Development Centre
|
Russian Federation
|
EMC Software and Services India Private Limited
|
India
|
EMC South Street Investments LLC
|
United States
|
EMC St. Petersburg Development Centre
|
Russian Federation
|
EMC Technology India Private Limited
|
India
|
Evolutionary Corporation
|
United States
|
Flanders Road Holdings LLC
|
United States
|
Force10 Networks Global, Inc.
|
United States
|
Force10 Networks International, Inc.
|
United States
|
Force10 Networks Singapore Pte. Ltd.
|
Singapore
|
Force10 Networks Singapore Pte. Ltd., Hong Kong Branch
|
Hong Kong
|
Force10 Networks, Inc.
|
United States
|
GoPivotal (UK) Limited
|
United Kingdom
|
GoPivotal Israel Ltd.
|
Israel
|
GoPivotal Italia S.r.l.
|
Italy
|
GoPivotal Netherlands B.V.
|
Netherlands
|
GoPivotal Singapore Pte. Limited
|
Singapore
|
GoPivotal Software India Private Limited
|
India
|
GPVTL Canada Inc.
|
Canada
|
Hankook EMC Computer Systems Chusik Hoesa
|
Korea, Republic of
|
Hankook EMC Computer Systems Chusik Hoesa
|
Hong Kong
|
Heptio LLC
|
United States
|
Heptio UK Limited
|
United Kingdom
|
Immidio B.V.
|
Netherlands
|
Information Systems EMC Greece S.A.
|
Greece
|
Iomega Holdings Corporation
|
United States
|
Iomega LLC
|
United States
|
Isilon Systems International LLC
|
United States
|
Isilon Systems LLC
|
United States
|
iWave Software LLC
|
United States
|
Liaison Office (Bureau d'Etudes) of EMC Computer Systems Austria GmbH
|
Morocco
|
License Technologies Group, Inc.
|
United States
|
Likewise Software LLC
|
United States
|
LLC “EMC Information Systems Ukraine”
|
Ukraine
|
LLC Dell Ukraine
|
Ukraine
|
Maginatics LLC
|
United States
|
More I.T. Resources Ltd.
|
Israel
|
NBT Investment Partners LLC
|
United States
|
NetWitness International LLC
|
United States
|
Newfound Investment Partners LLC
|
United States
|
Nicira, Inc.
|
United States
|
OptiGrowth Capital S.a.r.l
|
Luxembourg
|
Oy Dell AB
|
Finland
|
Perot Systems India Foundation
|
India
|
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
|
Ireland
|
Pivotal Software International Holdings
|
Ireland
|
Pivotal Software Korea Ltd.
|
Korea, Republic of
|
Pivotal Software, Inc.
|
United States
|
Pivotal Technology (Beijing) Co., Ltd.
|
China
|
Pivotal Technology (Beijing) Co., Ltd. - Shanghai Branch
|
China
|
PT Dell Indonesia
|
Indonesia
|
PT EMC Information Systems
|
Indonesia
|
PT VMware Software Indonesia
|
Indonesia
|
QTZ L.L.C.
|
United States
|
Representative Office of Dell Global B.V. in Hanoi
|
Vietnam
|
Representative Office of Dell Global B.V. in Ho Chi Minh City
|
Vietnam
|
Representative Office of EMC Computer Systems (South Asia) Pte. Ltd. in Hanoi
|
Vietnam
|
Representative Office of EMC Computer Systems (South Asia) Pte. Ltd. in Ho Chi Minh City
|
Vietnam
|
Representative Office of EMC Computer Systems Austria GmbH in Belgrade
|
Serbia
|
RSA Federal LLC
|
United States
|
RSA Security B.V. India Liaison Office
|
India
|
RSA Security LLC
|
United States
|
ScaleIO LLC
|
United States
|
ScaleIO, Ltd.
|
Israel
|
SecureWorks Australia Pty. Ltd.
|
Australia
|
SecureWorks Corp.
|
United States
|
SecureWorks Europe Limited
|
United Kingdom
|
SecureWorks Europe S.R.L.
|
Romania
|
SecureWorks India Private Limited
|
India
|
SecureWorks Japan K.K.
|
Japan
|
SecureWorks SAS
|
France
|
SecureWorks, Inc.
|
United States
|
Sichuan An Cheng Security Technology Company
|
China
|
Taiwan VMware Information Technology LLC
|
Taiwan
|
VCE Company, LLC
|
United States
|
VCE IP Holding Company LLC
|
United States
|
VCE Solutions B.V.
|
Netherlands
|
VCE Solutions Limited
|
United Kingdom
|
VCE Solutions Pte. Ltd.
|
Singapore
|
VCE Solutions S.A.S.
|
France
|
VCE Technologies Pty Ltd
|
Australia
|
VCE Technology Solutions K.K.
|
Japan
|
VCE Technology Solutions Limited
|
Ireland
|
VCE Technology Solutions Limited - Dubai Branch Office
|
United Arab Emirates
|
VeloCloud Networks Private Limited
|
India
|
Velocloud Networks, LLC
|
United States
|
Virtustream Bulgaria EOOD
|
Bulgaria
|
Virtustream Canada Holdings, Inc.
|
Canada
|
Virtustream Cloud Services Australia Pty Limited
|
Australia
|
Virtustream Cloud Services Ireland Unlimited Company
|
Ireland
|
Virtustream Cloud Services Italia S.r.l.
|
Italy
|
Virtustream Cloud Services Japan K.K.
|
Japan
|
Virtustream Germany GmbH
|
Germany
|
Virtustream Group Holdings, Inc.
|
United States
|
Virtustream IP Holding Company LLC
|
United States
|
Virtustream Ireland Limited
|
Ireland
|
Virtustream Limited
|
Jersey
|
Virtustream LT UAB
|
Lithuania
|
Virtustream Security Solutions LLC
|
United States
|
Virtustream Security Solutions Private Limited
|
India
|
Virtustream Switzerland Sàrl
|
Switzerland
|
Virtustream UK Limited
|
United Kingdom
|
Virtustream, Inc.
|
United States
|
VMW Holdco LLC
|
United States
|
VMware (Thailand) Co., Ltd.
|
Thailand
|
VMware Australia Pty Ltd
|
Australia
|
VMware Belgium
|
Belgium
|
VMware Bermuda Unlimited Company
|
Ireland
|
VMware Bulgaria EOOD
|
Bulgaria
|
VMware Canada Inc.
|
Canada
|
VMware Costa Rica Ltda.
|
Costa Rica
|
VMware Denmark ApS
|
Denmark
|
VMware Eastern Europe
|
Armenia
|
VMware France SAS
|
France
|
VMware Global, Inc.
|
United States
|
VMware Global, Inc. Zweigniederlassung Deutschland
|
Germany
|
VMware Hong Kong Limited
|
Hong Kong
|
VMware Information Technology (China) Co. Ltd.
|
China
|
VMware Information Technology (China) Co. Ltd. - Beijing Branch
|
China
|
VMware Information Technology (China) Co. Ltd. - Guangzhou Branch
|
China
|
VMware Information Technology (China) Co. Ltd. - Shanghai Branch
|
China
|
VMware International Limited
|
Ireland
|
VMware International Marketing Limited
|
Ireland
|
VMware Israel Ltd.
|
Israel
|
VMware Italy S.r.l.
|
Italy
|
VMware Korea Co., Ltd.
|
Korea, Republic of
|
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
|
United Arab Emirates
|
VMware Netherlands B.V.
|
Netherlands
|
VMware NZ Company
|
New Zealand
|
VMware Rus LLC
|
Russian Federation
|
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 Turkey Software Solutions and Services Company Limited
|
Turkey
|
VMware UK Limited
|
United Kingdom
|
VMware, Inc.
|
United States
|
VMware, K.K.
|
Japan
|
Waltham Ventures LLC
|
United States
|
Wanova Technologies Ltd.
|
Israel
|
Wyse International L.L.C.
|
United States
|
Wyse Technology GmbH
|
Germany
|
Wyse Technology International B.V.
|
Netherlands
|
Wyse Technology L.L.C.
|
United States
|
XtremlO Ltd.
|
Israel
|
1.
|
I have reviewed this Annual Report on Form 10-K of Dell Technologies 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 Rules 13a-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.
|
March 29, 2019
|
|
/s/ MICHAEL S. DELL
|
|
|
Michael S. Dell
|
|
|
Chairman and Chief Executive Officer
|
1.
|
I have reviewed this Annual Report on Form 10-K of Dell Technologies 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 Rules 13a-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.
|
March 29, 2019
|
|
/s/ THOMAS W. SWEET
|
|
|
Thomas W. Sweet
|
|
|
Executive Vice President and Chief Financial Officer
|
March 29, 2019
|
|
/s/ MICHAEL S. DELL
|
|
|
Michael S. Dell
|
|
|
Chairman and Chief Executive Officer
|
March 29, 2019
|
|
/s/ THOMAS W. SWEET
|
|
|
Thomas W. Sweet
|
|
|
Executive Vice President and Chief Financial Officer
|
|
Fiscal Year Ended
|
|
September 7, 2016 through
|
||||||||||||||||||||||||||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||||||||||||||||||||||||||
|
VMware Reportable Segment
|
|
Adjustments and Eliminations (a)
|
|
VMware
|
|
VMware Reportable Segment
|
|
Adjustments and Eliminations (a)
|
|
VMware
|
|
VMware Reportable Segment
|
|
Adjustments and Eliminations (a)
|
|
VMware
|
||||||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||||||||||
Net revenue
|
$
|
9,088
|
|
|
$
|
(114
|
)
|
|
$
|
8,974
|
|
|
$
|
7,994
|
|
|
$
|
(132
|
)
|
|
$
|
7,862
|
|
|
$
|
3,543
|
|
|
$
|
(402
|
)
|
|
$
|
3,141
|
|
Cost of net revenue
|
1,086
|
|
|
172
|
|
|
1,258
|
|
|
990
|
|
|
151
|
|
|
1,141
|
|
|
399
|
|
|
54
|
|
|
453
|
|
|||||||||
Gross margin
|
8,002
|
|
|
(286
|
)
|
|
7,716
|
|
|
7,004
|
|
|
(283
|
)
|
|
6,721
|
|
|
3,144
|
|
|
(456
|
)
|
|
2,688
|
|
|||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||
Selling, general, and administrative
|
3,407
|
|
|
284
|
|
|
3,691
|
|
|
2,801
|
|
|
463
|
|
|
3,264
|
|
|
1,113
|
|
|
228
|
|
|
1,341
|
|
|||||||||
Research and development
|
1,606
|
|
|
369
|
|
|
1,975
|
|
|
1,394
|
|
|
361
|
|
|
1,755
|
|
|
515
|
|
|
144
|
|
|
659
|
|
|||||||||
Total operating expenses
|
5,013
|
|
|
653
|
|
|
5,666
|
|
|
4,195
|
|
|
824
|
|
|
5,019
|
|
|
1,628
|
|
|
372
|
|
|
2,000
|
|
|||||||||
Operating income (loss)
|
$
|
2,989
|
|
|
$
|
(939
|
)
|
|
$
|
2,050
|
|
|
$
|
2,809
|
|
|
$
|
(1,107
|
)
|
|
$
|
1,702
|
|
|
$
|
1,516
|
|
|
$
|
(828
|
)
|
|
$
|
688
|
|
Interest and other income (expense), net attributable to VMware
|
|
|
|
|
833
|
|
|
|
|
|
|
112
|
|
|
|
|
|
|
6
|
|
|||||||||||||||
Income before income taxes attributable to VMware
|
|
|
|
2,883
|
|
|
|
|
|
|
1,814
|
|
|
|
|
|
|
694
|
|
||||||||||||||||
Income tax provision attributable to VMware
|
|
|
|
|
461
|
|
|
|
|
|
|
1,155
|
|
|
|
|
|
|
131
|
|
|||||||||||||||
Net income attributable to VMware
|
|
|
|
|
$
|
2,422
|
|
|
|
|
|
|
$
|
659
|
|
|
|
|
|
|
$
|
563
|
|
(a)
|
Adjustments and eliminations primarily consist of intercompany sales and allocated expenses, as well as expenses that are excluded from the VMware reportable segment, such as amortization of intangible assets, stock-based compensation expense, severance, and integration and acquisition-related costs.
|
|
Fiscal Year Ended
|
|
September 7, 2016 through
|
||||||||
|
February 1, 2019
|
|
February 2, 2018
|
|
February 3, 2017
|
||||||
|
(in millions)
|
||||||||||
Net income attributable to VMware
|
$
|
2,422
|
|
|
$
|
659
|
|
|
$
|
563
|
|
Less: Net income attributable to VMware for the period from December 28, 2018 to February 1, 2019
|
(15
|
)
|
|
—
|
|
|
|
||||
Less: Net income attributable to non-controlling interests
|
(452
|
)
|
|
(121
|
)
|
|
(97
|
)
|
|||
Net income attributable to Class V Group
|
1,955
|
|
|
538
|
|
|
466
|
|
|||
Less: DHI Group's 38.90%, 38.48% and 36.43%, respectively, weighted average retained interest in Class V Group
|
(760
|
)
|
|
(207
|
)
|
|
(170
|
)
|
|||
Class V Common Stock economic interest in Class V Group (a)
|
$
|
1,195
|
|
|
$
|
331
|
|
|
$
|
296
|
|
(a)
|
For the fiscal year ended February 1, 2019, Class V Common Stock economic interest in the Class V Group represents net income attributable to the Class V Group for the period ended December 27, 2018, the last date on which the Class V Common Stock traded on the New York Stock Exchange.
|