News summary
- Third quarter revenue of $24.4
billion, up 10% year over year
- Infrastructure Solutions Group (ISG) revenue of $11.4 billion, up 34% year over year, with
servers and networking revenue of $7.4
billion, up 58%
- Client Solutions Group (CSG) revenue of $12.1 billion, down 1% year over year, with
commercial client revenue up 3% at $10.1
billion
- Diluted earnings per share of $1.58, up 16% year over year, and non-GAAP
diluted earnings per share of $2.15,
up 14%
ROUND
ROCK, Texas, Nov. 26,
2024 /PRNewswire/ --
Full story
Dell Technologies (NYSE: DELL) announces
financial results for its fiscal 2025 third quarter. Revenue was
$24.4 billion, up 10% year over year.
Operating income was $1.7 billion and
non-GAAP operating income was $2.2
billion, both up 12% year over year. Diluted earnings
per share was $1.58, and non-GAAP
diluted earnings per share was $2.15, up 16% and 14% year over
year, respectively.
"We continued to build on our AI leadership and momentum,
delivering combined ISG and CSG revenue of $23.5 billion, up 13% year over year," said
Yvonne McGill, chief financial
officer, Dell Technologies. "Our continued focus on profitability
resulted in EPS growth that outpaced revenue growth, and we again
delivered strong cash performance."
Cash flow from operations was $1.6
billion, and Dell ended the quarter with $6.6 billion in cash and investments.
Third Quarter Fiscal 2025 Financial Results
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
(in millions, except
per share amounts and percentages; unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue
|
$
24,366
|
|
$
22,251
|
|
10 %
|
|
$
71,636
|
|
$
66,107
|
|
8 %
|
|
Operating
income
|
$
1,668
|
|
$
1,486
|
|
12 %
|
|
$
3,930
|
|
$
3,720
|
|
6 %
|
|
Net income
|
$
1,127
|
|
$
1,004
|
|
12 %
|
|
$
2,923
|
|
$
2,037
|
|
43 %
|
|
Change in cash from
operating activities
|
$
1,553
|
|
$
2,152
|
|
(28) %
|
|
$
3,936
|
|
$
7,143
|
|
(45) %
|
|
Earnings per share -
diluted
|
$
1.58
|
|
$
1.36
|
|
16 %
|
|
$
4.07
|
|
$
2.78
|
|
46 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP operating
income
|
$
2,199
|
|
$
1,964
|
|
12 %
|
|
$
5,707
|
|
$
5,539
|
|
3 %
|
|
Non-GAAP net
income
|
$
1,540
|
|
$
1,389
|
|
11 %
|
|
$
3,834
|
|
$
3,635
|
|
5 %
|
|
Adjusted free cash
flow
|
$
716
|
|
$
860
|
|
(17) %
|
|
$
2,623
|
|
$
4,597
|
|
(43) %
|
|
Non-GAAP earnings per
share - diluted
|
$
2.15
|
|
$
1.88
|
|
14 %
|
|
$
5.31
|
|
$
4.93
|
|
8 %
|
Information about Dell Technologies' use of non-GAAP
financial information is provided under "Non-GAAP Financial
Measures" below. All comparisons in this press release are year
over year unless otherwise noted.
Infrastructure Solutions Group (ISG) delivered
record third-quarter revenue of $11.4
billion, up 34% year over year. Servers and networking
revenue was $7.4 billion, up 58%, with demand growth across AI
and traditional servers. Storage revenue was $4.0 billion, up 4%. Operating income was
$1.5 billion.
"AI is a robust opportunity for us with no signs of slowing
down," said Jeff Clarke, vice
chairman and chief operating officer, Dell Technologies. "Interest
in our portfolio is at an all-time high, driving record AI server
orders demand of $3.6 billion in Q3
and a pipeline that grew more than 50%, with growth across all
customer types."
Client Solutions Group (CSG) delivered third
quarter revenue of $12.1 billion,
down 1% year over year. Commercial client revenue was up 3% at
$10.1 billion, and Consumer revenue
was $2.0 billion, down 18%. Operating
income was $694 million.
Operating Segments Results
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
(in millions, except
percentages; unaudited)
|
|
Infrastructure
Solutions Group (ISG):
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
Servers and
networking
|
$
7,364
|
|
$
4,656
|
|
58 %
|
|
$ 20,502
|
|
$ 12,767
|
|
61 %
|
|
Storage
|
4,004
|
|
3,843
|
|
4 %
|
|
11,739
|
|
11,786
|
|
— %
|
|
Total ISG net
revenue
|
$
11,368
|
|
$
8,499
|
|
34 %
|
|
$ 32,241
|
|
$ 24,553
|
|
31 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Income:
|
|
|
|
|
|
|
|
|
|
|
|
|
ISG operating
income
|
$
1,508
|
|
$
1,069
|
|
41 %
|
|
$
3,528
|
|
$
2,858
|
|
23 %
|
|
% of ISG net
revenue
|
13.3 %
|
|
12.6 %
|
|
|
|
10.9 %
|
|
11.6 %
|
|
|
|
% of total
reportable segment operating income
|
68 %
|
|
54 %
|
|
|
|
62 %
|
|
51 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Client Solutions
Group (CSG):
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
|
$ 10,138
|
|
$
9,835
|
|
3 %
|
|
$ 30,848
|
|
$ 30,251
|
|
2 %
|
|
Consumer
|
1,993
|
|
2,441
|
|
(18) %
|
|
5,664
|
|
6,950
|
|
(19) %
|
|
Total CSG net
revenue
|
$ 12,131
|
|
$
12,276
|
|
(1) %
|
|
$ 36,512
|
|
$ 37,201
|
|
(2) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Income:
|
|
|
|
|
|
|
|
|
|
|
|
|
CSG operating
income
|
$
694
|
|
$
925
|
|
(25) %
|
|
$
2,193
|
|
$
2,786
|
|
(21) %
|
|
% of CSG net
revenue
|
5.7 %
|
|
7.5 %
|
|
|
|
6.0 %
|
|
7.5 %
|
|
|
|
% of total
reportable segment operating income
|
32 %
|
|
46 %
|
|
|
|
38 %
|
|
49 %
|
|
|
Conference call information
As previously announced, the company will hold a conference call
to discuss its performance and financial guidance on Nov. 26 at 3:30 p.m.
CST. Prior to the start of the conference call, prepared
remarks and a presentation containing additional financial and
operating information prior to financial guidance may be
downloaded from investors.delltechnologies.com. The conference call
will be broadcast live over the internet and can be accessed at
https://investors.delltechnologies.com/news-events/upcoming-events.
For those unable to listen to the live broadcast, the final
remarks and presentation with financial guidance will be available
following the broadcast, and an archived version will be available
at the same location for one year.
About Dell Technologies
Dell Technologies (NYSE:DELL) helps organizations and
individuals build their digital future and transform how they work,
live and play. The company provides customers with the industry's
broadest and most innovative technology and services portfolio for
the AI era.
Copyright © 2024 Dell Inc. or its subsidiaries. All Rights
Reserved. Dell Technologies, Dell, EMC and Dell EMC are trademarks
of Dell Inc. or its subsidiaries. Other trademarks may be
trademarks of their respective owners.
Non-GAAP Financial Measures:
This press release presents information about non-GAAP gross
margin, non-GAAP operating expenses, non-GAAP operating income,
non-GAAP net income, non-GAAP net income attributable to Dell
Technologies Inc., non-GAAP earnings per share attributable to Dell
Technologies Inc. – diluted, free cash flow, and adjusted free cash
flow, all of which are non-GAAP financial measures provided as a
supplement to the results provided in accordance with generally
accepted accounting principles in the
United States of America ("GAAP"). A reconciliation of each
non-GAAP financial measure to the most directly comparable GAAP
financial measure is provided in the attached tables for each of
the fiscal periods indicated.
Special Note on Forward-Looking Statements:
Statements in this press release that relate to future
results and events are forward-looking statements within the
meaning of Section 21E of the Securities Exchange Act of 1934 and
Section 27A of the Securities Act of 1933 and are based on Dell
Technologies' current expectations. In some cases, you can identify
these statements by such forward-looking words as "anticipate,"
"believe," "confidence," "could," "estimate," "expect," "guidance,"
"intend," "may," "objective," "outlook," "plan," "project,"
"possible," "potential," "should," "will" and "would," or similar
words or expressions that refer to future events or
outcomes.
Dell Technologies' results or events in future periods could
differ materially from those expressed or implied by these
forward-looking statements because of risks, uncertainties, and
other factors that include, but are not limited to, the following:
adverse global economic conditions and instability in financial
markets; competitive pressures; Dell Technologies' reliance on
third-party suppliers for products and components, including
reliance on single-source or limited-source suppliers; Dell
Technologies' ability to achieve favorable pricing from its
vendors; Dell Technologies' execution of its strategy; social and
ethical issues relating to the use of new and evolving
technologies; Dell Technologies' ability to manage solutions and
products and services transitions in an effective manner; Dell
Technologies' ability to deliver high-quality products, software,
and services; cyber attacks or other data security incidents; Dell
Technologies' ability to successfully execute on strategic
initiatives including acquisitions, divestitures or cost savings
measures; Dell Technologies' foreign operations and ability to
generate substantial non-U.S. net revenue; Dell Technologies'
product, services, customer, and geographic sales mix, and seasonal
sales trends; the performance of Dell Technologies' sales channel
partners; access to the capital markets by Dell Technologies or its
customers; material impairment of the value of goodwill or
intangible assets; adverse economic conditions and the effect of
additional regulation on Dell Technologies' financial services
activities; counterparty default risks; the loss by Dell
Technologies of any contracts for ISG services and solutions and
its ability to perform such contracts at their estimated costs;
loss by Dell Technologies of government contracts; Dell
Technologies' ability to develop and protect its proprietary
intellectual property or obtain licenses to intellectual property
developed by others on commercially reasonable and competitive
terms; disruptions in Dell Technologies' infrastructure; Dell
Technologies' ability to hedge effectively its exposure to
fluctuations in foreign currency exchange rates and interest rates;
expiration of tax holidays or favorable tax rate structures, or
unfavorable outcomes in tax audits and other tax compliance
matters; impairment of portfolio investments; unfavorable results
of legal proceedings; expectations relating to environmental,
social and governance (ESG) considerations; compliance requirements
of changing environmental and safety laws, human rights laws, or
other laws; the effect of armed hostilities, terrorism, natural
disasters, or public health issues; the effect of global climate
change and legal, regulatory, or market measures to address climate
change; Dell Technologies' dependence on the services of
Michael Dell and key employees; Dell
Technologies' level of indebtedness; and business and financial
factors and legal restrictions affecting continuation of Dell
Technologies' quarterly cash dividend policy and dividend
rate.
This list of risks, uncertainties, and other factors is not
complete. Dell Technologies discusses some of these matters more
fully, as well as certain risk factors that could affect Dell
Technologies' business, financial condition, results of operations,
and prospects, in its reports filed with the SEC, including Dell
Technologies' annual report on Form 10-K for the fiscal year ended
February 2, 2024, quarterly reports
on Form 10-Q, and current reports on Form 8-K. These filings are
available for review through the SEC's website at www.sec.gov. Any
or all forward-looking statements Dell Technologies makes may turn
out to be wrong and can be affected by inaccurate assumptions Dell
Technologies might make or by known or unknown risks,
uncertainties, and other factors, including those identified in
this press release. Accordingly, you should not place undue
reliance on the forward-looking statements made in this press
release, which speak only as of its date. Dell Technologies does
not undertake to update, and expressly disclaims any duty to
update, its forward-looking statements, whether as a result of
circumstances or events that arise after the date they are made,
new information, or otherwise.
|
DELL TECHNOLOGIES
INC.
Condensed Consolidated Statements of
Income and Related Financial Highlights
(in
millions, except percentages; unaudited)
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
Net
revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
Products
|
18,290
|
|
16,233
|
|
13 %
|
|
53,371
|
|
48,204
|
|
11 %
|
|
Services
|
6,076
|
|
6,018
|
|
1 %
|
|
18,265
|
|
17,903
|
|
2 %
|
|
Total net
revenue
|
24,366
|
|
22,251
|
|
10 %
|
|
71,636
|
|
66,107
|
|
8 %
|
|
Cost of net
revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
Products
|
15,541
|
|
13,546
|
|
15 %
|
|
45,386
|
|
39,923
|
|
14 %
|
|
Services
|
3,518
|
|
3,557
|
|
(1) %
|
|
10,826
|
|
10,631
|
|
2 %
|
|
Total cost of net
revenue
|
19,059
|
|
17,103
|
|
11 %
|
|
56,212
|
|
50,554
|
|
11 %
|
|
Gross
margin
|
5,307
|
|
5,148
|
|
3 %
|
|
15,424
|
|
15,553
|
|
(1) %
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general, and
administrative
|
2,894
|
|
2,970
|
|
(3) %
|
|
9,206
|
|
9,748
|
|
(6) %
|
|
Research and
development
|
745
|
|
692
|
|
8 %
|
|
2,288
|
|
2,085
|
|
10 %
|
|
Total operating
expenses
|
3,639
|
|
3,662
|
|
(1) %
|
|
11,494
|
|
11,833
|
|
(3) %
|
|
Operating
income
|
1,668
|
|
1,486
|
|
12 %
|
|
3,930
|
|
3,720
|
|
6 %
|
|
Interest and other,
net
|
(276)
|
|
(306)
|
|
10 %
|
|
(1,002)
|
|
(1,121)
|
|
11 %
|
|
Income before income
taxes
|
1,392
|
|
1,180
|
|
18 %
|
|
2,928
|
|
2,599
|
|
13 %
|
|
Income tax
expense
|
265
|
|
176
|
|
51 %
|
|
5
|
|
562
|
|
(99) %
|
|
Net income
|
1,127
|
|
1,004
|
|
12 %
|
|
2,923
|
|
2,037
|
|
43 %
|
|
Less: Net loss
attributable to non-controlling interests
|
(5)
|
|
(2)
|
|
(150) %
|
|
(15)
|
|
(14)
|
|
(7) %
|
|
Net income
attributable to Dell Technologies Inc.
|
$
1,132
|
|
$
1,006
|
|
13 %
|
|
$
2,938
|
|
$
2,051
|
|
43 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage of Total
Net Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
margin
|
21.8 %
|
|
23.1 %
|
|
|
|
21.5 %
|
|
23.5 %
|
|
|
|
Selling, general, and
administrative
|
11.9 %
|
|
13.3 %
|
|
|
|
12.8 %
|
|
14.7 %
|
|
|
|
Research and
development
|
3.1 %
|
|
3.1 %
|
|
|
|
3.2 %
|
|
3.2 %
|
|
|
|
Operating
expenses
|
15.0 %
|
|
16.4 %
|
|
|
|
16.0 %
|
|
17.9 %
|
|
|
|
Operating
income
|
6.8 %
|
|
6.7 %
|
|
|
|
5.5 %
|
|
5.6 %
|
|
|
|
Income before income
taxes
|
5.7 %
|
|
5.3 %
|
|
|
|
4.1 %
|
|
3.9 %
|
|
|
|
Net income
|
4.6 %
|
|
4.5 %
|
|
|
|
4.1 %
|
|
3.1 %
|
|
|
|
Income tax
rate
|
19.0 %
|
|
14.9 %
|
|
|
|
0.2 %
|
|
21.6 %
|
|
|
|
|
|
Amounts are based on
underlying data and may not visually foot due to
rounding.
|
|
DELL TECHNOLOGIES
INC.
Condensed Consolidated Statements of Financial
Position
(in millions; unaudited)
|
|
|
November 1,
2024
|
|
February 2,
2024
|
|
ASSETS
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
5,225
|
|
$
7,366
|
|
Accounts receivable,
net of allowance of $62 and $71
|
11,189
|
|
9,343
|
|
Short-term financing
receivables, net of allowance of $74 and $79
|
5,001
|
|
4,643
|
|
Inventories
|
6,652
|
|
3,622
|
|
Other current
assets
|
9,306
|
|
10,973
|
|
Current assets held for
sale
|
662
|
|
—
|
|
Total current
assets
|
38,035
|
|
35,947
|
|
Property, plant, and
equipment, net
|
6,327
|
|
6,432
|
|
Long-term
investments
|
1,312
|
|
1,316
|
|
Long-term financing
receivables, net of allowance of $70 and $91
|
5,849
|
|
5,877
|
|
Goodwill
|
19,243
|
|
19,700
|
|
Intangible assets,
net
|
5,147
|
|
5,701
|
|
Other non-current
assets
|
6,038
|
|
7,116
|
|
Total
assets
|
$
81,951
|
|
$
82,089
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
Current
liabilities:
|
|
|
|
|
Short-term
debt
|
$
5,612
|
|
$
6,982
|
|
Accounts
payable
|
23,400
|
|
19,389
|
|
Accrued and
other
|
6,490
|
|
6,805
|
|
Short-term deferred
revenue
|
13,787
|
|
15,318
|
|
Current liabilities
held for sale
|
211
|
|
—
|
|
Total current
liabilities
|
49,500
|
|
48,494
|
|
Long-term
debt
|
19,410
|
|
19,012
|
|
Long-term deferred
revenue
|
12,424
|
|
13,827
|
|
Other non-current
liabilities
|
2,807
|
|
3,065
|
|
Total
liabilities
|
84,141
|
|
84,398
|
|
Stockholders' equity
(deficit):
|
|
|
|
|
Common stock and
capital in excess of $0.01 par value
|
8,951
|
|
8,926
|
|
Treasury stock at
cost
|
(7,747)
|
|
(5,900)
|
|
Accumulated
deficit
|
(2,669)
|
|
(4,630)
|
|
Accumulated other
comprehensive loss
|
(820)
|
|
(800)
|
|
Total Dell Technologies
Inc. stockholders' equity (deficit)
|
(2,285)
|
|
(2,404)
|
|
Non-controlling
interests
|
95
|
|
95
|
|
Total stockholders'
equity (deficit)
|
(2,190)
|
|
(2,309)
|
|
Total liabilities and
stockholders' equity
|
$
81,951
|
|
$
82,089
|
|
DELL TECHNOLOGIES
INC.
Condensed Consolidated Statements of Cash
Flows
(in millions; unaudited)
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
November 1,
2024
|
|
November 3,
2023
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
Net income
|
$
1,127
|
|
$
1,004
|
|
$
2,923
|
|
$
2,037
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
426
|
|
1,148
|
|
1,013
|
|
5,106
|
|
Change in cash from
operating activities
|
1,553
|
|
2,152
|
|
3,936
|
|
7,143
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Purchases of
investments
|
(19)
|
|
(30)
|
|
(83)
|
|
(143)
|
|
Maturities and sales of
investments
|
121
|
|
23
|
|
337
|
|
150
|
|
Capital expenditures
and capitalized software development costs
|
(639)
|
|
(704)
|
|
(1,917)
|
|
(2,029)
|
|
Acquisition of
businesses and assets, net
|
—
|
|
(127)
|
|
—
|
|
(127)
|
|
Other
|
13
|
|
13
|
|
126
|
|
35
|
|
Change in cash from
investing activities
|
(524)
|
|
(825)
|
|
(1,537)
|
|
(2,114)
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Proceeds from the
issuance of common stock
|
—
|
|
4
|
|
1
|
|
8
|
|
Repurchases of common
stock
|
(429)
|
|
(702)
|
|
(1,854)
|
|
(1,202)
|
|
Repurchases of common
stock for employee tax withholdings
|
(25)
|
|
(42)
|
|
(560)
|
|
(354)
|
|
Payments of dividends
and dividend equivalents
|
(312)
|
|
(266)
|
|
(964)
|
|
(811)
|
|
Proceeds from
debt
|
3,680
|
|
2,249
|
|
8,613
|
|
6,904
|
|
Repayments of
debt
|
(3,200)
|
|
(2,684)
|
|
(9,594)
|
|
(9,766)
|
|
Debt-related costs and
other, net
|
(29)
|
|
(5)
|
|
(66)
|
|
(54)
|
|
Change in cash from
financing activities
|
(315)
|
|
(1,446)
|
|
(4,424)
|
|
(5,275)
|
|
Effect of exchange rate
changes on cash, cash equivalents, and restricted cash
|
19
|
|
(83)
|
|
(78)
|
|
(200)
|
|
Change in cash, cash
equivalents, and restricted cash
|
733
|
|
(202)
|
|
(2,103)
|
|
(446)
|
|
Cash, cash equivalents,
and restricted cash at beginning of the period
|
4,671
|
|
8,650
|
|
7,507
|
|
8,894
|
|
Cash, cash
equivalents, and restricted cash at end of the period
|
$
5,404
|
|
$
8,448
|
|
$
5,404
|
|
$
8,448
|
|
DELL TECHNOLOGIES
INC.
Segment Information
(in millions, except
percentages; unaudited; continued on next page)
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
Infrastructure
Solutions Group (ISG):
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
Servers and
networking
|
$ 7,364
|
|
$ 4,656
|
|
58 %
|
|
$
20,502
|
|
$
12,767
|
|
61 %
|
|
Storage
|
4,004
|
|
3,843
|
|
4 %
|
|
11,739
|
|
11,786
|
|
— %
|
|
Total ISG net
revenue
|
$
11,368
|
|
$ 8,499
|
|
34 %
|
|
$
32,241
|
|
$
24,553
|
|
31 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Income:
|
|
|
|
|
|
|
|
|
|
|
|
|
ISG operating
income
|
$ 1,508
|
|
$ 1,069
|
|
41 %
|
|
$ 3,528
|
|
$
2,858
|
|
23 %
|
|
% of ISG net
revenue
|
13.3 %
|
|
12.6 %
|
|
|
|
10.9 %
|
|
11.6 %
|
|
|
|
% of total
reportable segment operating income
|
68 %
|
|
54 %
|
|
|
|
62 %
|
|
51 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Client Solutions
Group (CSG):
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
|
$
10,138
|
|
$ 9,835
|
|
3 %
|
|
$
30,848
|
|
$
30,251
|
|
2 %
|
|
Consumer
|
1,993
|
|
2,441
|
|
(18) %
|
|
5,664
|
|
6,950
|
|
(19) %
|
|
Total CSG net
revenue
|
$
12,131
|
|
$
12,276
|
|
(1) %
|
|
$
36,512
|
|
$
37,201
|
|
(2) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Income:
|
|
|
|
|
|
|
|
|
|
|
|
|
CSG operating
income
|
$
694
|
|
$
925
|
|
(25) %
|
|
$ 2,193
|
|
$
2,786
|
|
(21) %
|
|
% of CSG net
revenue
|
5.7 %
|
|
7.5 %
|
|
|
|
6.0 %
|
|
7.5 %
|
|
|
|
% of total
reportable segment operating income
|
32 %
|
|
46 %
|
|
|
|
38 %
|
|
49 %
|
|
|
|
|
|
Amounts are based on
underlying data and may not visually foot due to
rounding.
|
|
DELL TECHNOLOGIES
INC.
Segment Information
(in millions, except
percentages; unaudited; continued)
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
November 1,
2024
|
|
November 3,
2023
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Reconciliation to
consolidated net revenue:
|
|
|
|
|
|
|
|
|
Reportable segment net
revenue
|
$
23,499
|
|
$
20,775
|
|
$
68,753
|
|
$
61,754
|
|
Other businesses
(a)
|
867
|
|
1,474
|
|
2,882
|
|
4,345
|
|
Unallocated
transactions (b)
|
—
|
|
2
|
|
1
|
|
8
|
|
Total consolidated net
revenue
|
$
24,366
|
|
$
22,251
|
|
$
71,636
|
|
$
66,107
|
|
|
|
|
|
|
|
|
|
Reconciliation to
consolidated operating income:
|
|
|
|
|
|
|
|
|
Reportable segment
operating income
|
$
2,202
|
|
$
1,994
|
|
$
5,721
|
|
$
5,644
|
|
Other businesses
(a)
|
(3)
|
|
(32)
|
|
(14)
|
|
(112)
|
|
Unallocated
transactions (b)
|
—
|
|
2
|
|
—
|
|
7
|
|
Amortization of
intangibles (c)
|
(168)
|
|
(207)
|
|
(504)
|
|
(623)
|
|
Stock-based
compensation expense (d)
|
(198)
|
|
(227)
|
|
(599)
|
|
(675)
|
|
Other corporate
expenses (e)
|
(165)
|
|
(44)
|
|
(674)
|
|
(521)
|
|
Total consolidated
operating income
|
$
1,668
|
|
$
1,486
|
|
$
3,930
|
|
$
3,720
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Other businesses
consists of: 1) Dell's resale of standalone VMware LLC,
formerly VMware, Inc. products and services, "VMware Resale," 2)
Secureworks, and 3) Virtustream, and do not meet the requirements
for a reportable segment, either individually or
collectively.
|
|
(b)
|
Unallocated
transactions includes other corporate items that are not allocated
to Dell Technologies' reportable segments.
|
|
(c)
|
Amortization of
intangibles includes non-cash purchase accounting adjustments that
are primarily related to the EMC merger
transaction.
|
|
(d)
|
Stock-based
compensation expense consists of equity awards granted based on the
estimated fair value of those awards at grant date.
|
|
(e)
|
Other corporate
expenses consist primarily of severance expenses, payroll taxes
associated with stock-based compensation, facility action costs,
transaction-related expenses, impairment charges, and incentive
charges related to equity investments.
|
|
|
SUPPLEMENTAL SELECTED NON-GAAP FINANCIAL
MEASURES
These tables present information about the Company's non-GAAP
gross margin, non-GAAP operating expenses, non-GAAP operating
income, non-GAAP net income, non-GAAP net income attributable to
Dell Technologies Inc., non-GAAP earnings per share attributable to
Dell Technologies Inc. - diluted, free cash flow and adjusted free
cash flow, all of which are non-GAAP financial measures provided as
a supplement to the results provided in accordance with generally
accepted accounting principles in the
United States of America ("GAAP"). A detailed discussion of
Dell Technologies' reasons for including these non-GAAP financial
measures, the limitations associated with these measures, the items
excluded from these measures, and our reason for excluding those
items are presented in "Management's Discussion and Analysis of
Financial Condition and Results of Operations — Non-GAAP Financial
Measures" in our periodic reports filed with the SEC. Dell
Technologies encourages investors to review the non-GAAP discussion
in these reports in conjunction with the presentation of non-GAAP
financial measures.
|
DELL TECHNOLOGIES
INC.
Selected Financial Measures
(in millions,
except per share amounts and percentages; unaudited)
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
Net revenue
|
$
24,366
|
|
$
22,251
|
|
10 %
|
|
$
71,636
|
|
$
66,107
|
|
8 %
|
|
Non-GAAP gross
margin
|
$
5,437
|
|
$
5,276
|
|
3 %
|
|
$
15,848
|
|
$
15,976
|
|
(1) %
|
|
% of net
revenue
|
22.3 %
|
|
23.7 %
|
|
|
|
22.1 %
|
|
24.2 %
|
|
|
|
Non-GAAP operating
expenses
|
$
3,238
|
|
$
3,312
|
|
(2) %
|
|
$
10,141
|
|
$
10,437
|
|
(3) %
|
|
% of net
revenue
|
13.3 %
|
|
14.9 %
|
|
|
|
14.1 %
|
|
15.8 %
|
|
|
|
Non-GAAP operating
income
|
$
2,199
|
|
$
1,964
|
|
12 %
|
|
$
5,707
|
|
$
5,539
|
|
3 %
|
|
% of net
revenue
|
9.0 %
|
|
8.8 %
|
|
|
|
8.0 %
|
|
8.4 %
|
|
|
|
Non-GAAP net
income
|
$
1,540
|
|
$
1,389
|
|
11 %
|
|
$
3,834
|
|
$
3,635
|
|
5 %
|
|
% of net
revenue
|
6.3 %
|
|
6.2 %
|
|
|
|
5.4 %
|
|
5.5 %
|
|
|
|
Non-GAAP earnings per
share - diluted
|
$
2.15
|
|
$
1.88
|
|
14 %
|
|
$
5.31
|
|
$
4.93
|
|
8 %
|
|
|
|
Amounts are based on
underlying data and may not visually foot due to
rounding.
|
|
DELL TECHNOLOGIES
INC.
Reconciliation of Selected Non-GAAP Financial
Measures
(in millions, except percentages; unaudited;
continued on next page)
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
Gross margin
|
$
5,307
|
|
$
5,148
|
|
3 %
|
|
$
15,424
|
|
$
15,553
|
|
(1) %
|
|
Non-GAAP
adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangibles
|
60
|
|
84
|
|
|
|
179
|
|
247
|
|
|
|
Stock-based
compensation expense
|
39
|
|
37
|
|
|
|
115
|
|
112
|
|
|
|
Other corporate
expenses
|
31
|
|
7
|
|
|
|
130
|
|
64
|
|
|
|
Non-GAAP gross
margin
|
$
5,437
|
|
$
5,276
|
|
3 %
|
|
$
15,848
|
|
$
15,976
|
|
(1) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses
|
$
3,639
|
|
$
3,662
|
|
(1) %
|
|
$
11,494
|
|
$
11,833
|
|
(3) %
|
|
Non-GAAP
adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangibles
|
(108)
|
|
(123)
|
|
|
|
(325)
|
|
(376)
|
|
|
|
Stock-based
compensation expense
|
(159)
|
|
(190)
|
|
|
|
(484)
|
|
(563)
|
|
|
|
Other corporate
expenses
|
(134)
|
|
(37)
|
|
|
|
(544)
|
|
(457)
|
|
|
|
Non-GAAP operating
expenses
|
$
3,238
|
|
$
3,312
|
|
(2) %
|
|
$
10,141
|
|
$
10,437
|
|
(3) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income
|
$
1,668
|
|
$
1,486
|
|
12 %
|
|
$
3,930
|
|
$
3,720
|
|
6 %
|
|
Non-GAAP
adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangibles
|
168
|
|
207
|
|
|
|
504
|
|
623
|
|
|
|
Stock-based
compensation expense
|
198
|
|
227
|
|
|
|
599
|
|
675
|
|
|
|
Other corporate
expenses
|
165
|
|
44
|
|
|
|
674
|
|
521
|
|
|
|
Non-GAAP operating
income
|
$
2,199
|
|
$
1,964
|
|
12 %
|
|
$
5,707
|
|
$
5,539
|
|
3 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
$
1,127
|
|
$
1,004
|
|
12 %
|
|
$
2,923
|
|
$
2,037
|
|
43 %
|
|
Non-GAAP
adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangibles
|
168
|
|
207
|
|
|
|
504
|
|
623
|
|
|
|
Stock-based
compensation expense
|
198
|
|
227
|
|
|
|
599
|
|
675
|
|
|
|
Other corporate
expenses
|
166
|
|
36
|
|
|
|
665
|
|
566
|
|
|
|
Fair value adjustments
on equity investments
|
(46)
|
|
(8)
|
|
|
|
(21)
|
|
36
|
|
|
|
Aggregate adjustment
for income taxes (a)
|
(73)
|
|
(77)
|
|
|
|
(836)
|
|
(302)
|
|
|
|
Non-GAAP net
income
|
$
1,540
|
|
$
1,389
|
|
11 %
|
|
$
3,834
|
|
$
3,635
|
|
5 %
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Beginning in Fiscal
2025, our non-GAAP income tax is calculated using a fixed estimated
annual tax rate.
|
|
DELL TECHNOLOGIES
INC.
Reconciliation of Selected Non-GAAP Financial
Measures
(unaudited; continued)
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
Earnings per share
attributable to Dell Technologies Inc. — diluted
|
$
1.58
|
|
$
1.36
|
|
16 %
|
|
$
4.07
|
|
$
2.78
|
|
46 %
|
|
Non-GAAP
adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
intangibles
|
0.23
|
|
0.28
|
|
|
|
0.70
|
|
0.84
|
|
|
|
Stock-based
compensation expense
|
0.28
|
|
0.31
|
|
|
|
0.83
|
|
0.91
|
|
|
|
Other corporate
expenses
|
0.23
|
|
0.04
|
|
|
|
0.92
|
|
0.77
|
|
|
|
Fair value adjustments
on equity investments
|
(0.06)
|
|
(0.01)
|
|
|
|
(0.03)
|
|
0.05
|
|
|
|
Aggregate adjustment
for income taxes (a)
|
(0.10)
|
|
(0.10)
|
|
|
|
(1.16)
|
|
(0.41)
|
|
|
|
Total non-GAAP
adjustments attributable to non-controlling interests
|
(0.01)
|
|
—
|
|
|
|
(0.02)
|
|
(0.01)
|
|
|
|
Non-GAAP earnings per
share attributable to Dell Technologies Inc.
— diluted
|
$
2.15
|
|
$
1.88
|
|
14 %
|
|
$
5.31
|
|
$
4.93
|
|
8 %
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Beginning in Fiscal
2025, our non-GAAP income tax is calculated using a fixed estimated
annual tax rate.
|
|
DELL TECHNOLOGIES
INC.
Reconciliation of Selected Non-GAAP Financial
Measures
(in millions, except percentages; unaudited;
continued)
|
|
|
Three Months
Ended
|
|
|
|
Nine Months
Ended
|
|
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
November 1,
2024
|
|
November 3,
2023
|
|
Change
|
|
Cash flow from
operations
|
$
1,553
|
|
$
2,152
|
|
(28) %
|
|
$
3,936
|
|
$
7,143
|
|
(45) %
|
|
Non-GAAP
adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital expenditures
and capitalized software development costs, net (a)
|
(639)
|
|
(704)
|
|
|
|
(1,861)
|
|
(2,026)
|
|
|
|
Free cash
flow
|
$
914
|
|
$
1,448
|
|
(37) %
|
|
$
2,075
|
|
$
5,117
|
|
(59) %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash
flow
|
$
914
|
|
$
1,448
|
|
(37) %
|
|
$
2,075
|
|
$
5,117
|
|
(59) %
|
|
Non-GAAP
adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing receivables
(b)
|
(233)
|
|
(575)
|
|
|
|
419
|
|
(445)
|
|
|
|
Equipment under
operating leases (c)
|
35
|
|
(13)
|
|
|
|
129
|
|
(75)
|
|
|
|
Adjusted free cash
flow
|
$
716
|
|
$
860
|
|
(17) %
|
|
$
2,623
|
|
$
4,597
|
|
(43) %
|
|
|
|
|
|
|
|
|
|
|
(a)
|
Capital expenditures
and capitalized software development costs is net of proceeds from
sales of facilities, land, and other assets.
|
|
(b)
|
Financing receivables
represent the operating cash flow impact from the change in DFS
financing receivables.
|
|
(c)
|
Equipment under
operating leases represents the net change of capital expenditures
and depreciation expense for DFS leases and contractually embedded
leases identified within flexible consumption
arrangements.
|
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SOURCE Dell Technologies
