Cover Page
Cover Page - shares | 6 Months Ended | |
Aug. 02, 2019 | Sep. 03, 2019 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Aug. 2, 2019 | |
Document Transition Report | false | |
Entity File Number | 001-37867 | |
Entity Registrant Name | Dell Technologies Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 80-0890963 | |
Entity Address, Address Line One | One Dell Way | |
Entity Address, City or Town | Round Rock | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 78682 | |
City Area Code | 800 | |
Local Phone Number | 289-3355 | |
Title of 12(b) Security | Class C Common Stock, par value of $0.01 per share | |
Trading Symbol | DELL | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001571996 | |
Current Fiscal Year End Date | --01-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding - Class C | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 231,577,113 | |
Entity Common Stock, Shares Outstanding - Class A | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 373,736,005 | |
Entity Common Stock, Shares Outstanding - Class B | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 119,336,038 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 9,193 | $ 9,676 |
Accounts receivable, net | 11,586 | 12,371 |
Short-term financing receivables, net | 4,473 | 4,398 |
Inventories, net | 3,135 | 3,649 |
Other current assets | 6,929 | 6,044 |
Total current assets | 35,316 | 36,138 |
Property, plant, and equipment, net | 5,568 | 5,259 |
Long-term investments | 768 | 1,005 |
Long-term financing receivables, net | 4,350 | 4,224 |
Goodwill | 39,998 | 40,089 |
Intangible assets, net | 19,719 | 22,270 |
Other non-current assets | 9,801 | 2,835 |
Total assets | 115,520 | 111,820 |
Current liabilities: | ||
Short-term debt | 5,949 | 4,320 |
Accounts payable | 19,411 | 19,213 |
Accrued and other | 8,092 | 8,495 |
Short-term deferred revenue | 13,568 | 12,944 |
Total current liabilities | 47,020 | 44,972 |
Long-term debt | 45,973 | 49,201 |
Long-term deferred revenue | 11,780 | 11,066 |
Other non-current liabilities | 6,628 | 6,327 |
Total liabilities | 111,401 | 111,566 |
Commitments and contingencies (Note 10) | ||
Redeemable shares (Note 17) | 1,024 | 1,196 |
Stockholders’ equity (deficit): | ||
Common stock and capital in excess of $0.01 par value (Note 14) | 15,956 | 16,114 |
Treasury stock at cost | (65) | (63) |
Accumulated deficit | (17,775) | (21,349) |
Accumulated other comprehensive loss | (565) | (467) |
Total Dell Technologies Inc. stockholders’ deficit | (2,449) | (5,765) |
Non-controlling interests | 5,544 | 4,823 |
Total stockholders’ equity (deficit) | 3,095 | (942) |
Total liabilities, redeemable shares, and stockholders’ equity (deficit) | $ 115,520 | $ 111,820 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Parenthetical) - $ / shares | Aug. 02, 2019 | Feb. 01, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | |
Net revenue: | ||||
Total net revenue | $ 23,370 | $ 22,942 | $ 45,278 | $ 44,298 |
Cost of net revenue: | ||||
Total cost of net revenue | 16,044 | 16,819 | 31,155 | 32,297 |
Gross margin | 7,326 | 6,123 | 14,123 | 12,001 |
Operating expenses: | ||||
Selling, general, and administrative | 5,578 | 4,961 | 10,649 | 9,905 |
Research and development | 1,229 | 1,175 | 2,405 | 2,262 |
Total operating expenses | 6,807 | 6,136 | 13,054 | 12,167 |
Operating income (loss) | 519 | (13) | 1,069 | (166) |
Interest and other, net | (630) | (455) | (1,323) | (925) |
Loss before income taxes | (111) | (468) | (254) | (1,091) |
Income tax benefit | (4,343) | (7) | (4,815) | (92) |
Net income (loss) | 4,232 | (461) | 4,561 | (999) |
Less: Net income attributable to non-controlling interests | 816 | 38 | 852 | 136 |
Net income (loss) attributable to Dell Technologies Inc. | $ 3,416 | (499) | $ 3,709 | (1,135) |
Earnings (loss) per share attributable to Dell Technologies Inc. - basic: | ||||
Earnings (loss) per share - basic (in dollars per share) | $ 4.75 | $ 5.17 | ||
Earnings (loss) per share attributable to Dell Technologies Inc. - diluted: | ||||
Earnings (loss) per share - diluted (in dollars per share) | $ 4.47 | $ 4.84 | ||
Class V Common Stock | ||||
Operating expenses: | ||||
Net income (loss) attributable to Dell Technologies Inc. | $ 320 | $ 790 | ||
Earnings (loss) per share attributable to Dell Technologies Inc. - basic: | ||||
Earnings (loss) per share - basic (in dollars per share) | $ 1.61 | $ 3.97 | ||
Earnings (loss) per share attributable to Dell Technologies Inc. - diluted: | ||||
Earnings (loss) per share - diluted (in dollars per share) | $ 1.58 | $ 3.91 | ||
DHI Group | ||||
Operating expenses: | ||||
Net income (loss) attributable to Dell Technologies Inc. | $ (819) | $ (1,925) | ||
Earnings (loss) per share attributable to Dell Technologies Inc. - basic: | ||||
Earnings (loss) per share - basic (in dollars per share) | $ (1.44) | $ (3.39) | ||
Earnings (loss) per share attributable to Dell Technologies Inc. - diluted: | ||||
Earnings (loss) per share - diluted (in dollars per share) | $ (1.45) | $ (3.40) | ||
Products | ||||
Net revenue: | ||||
Total net revenue | $ 18,110 | $ 18,149 | $ 34,864 | $ 34,820 |
Cost of net revenue: | ||||
Total cost of net revenue | 13,889 | 14,943 | 26,968 | 28,549 |
Services | ||||
Net revenue: | ||||
Total net revenue | 5,260 | 4,793 | 10,414 | 9,478 |
Cost of net revenue: | ||||
Total cost of net revenue | $ 2,155 | $ 1,876 | $ 4,187 | $ 3,748 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income (loss) | $ 4,232 | $ (461) | $ 4,561 | $ (999) |
Other comprehensive income (loss), net of tax | ||||
Foreign currency translation adjustments | (78) | (261) | (236) | (603) |
Available-for-sale investments: | ||||
Change in unrealized gains (losses) | 0 | 6 | 0 | (1) |
Reclassification adjustment for net gains realized in net income (loss) | 0 | 0 | 0 | (1) |
Net change in market value of investments | 0 | 6 | 0 | (2) |
Cash flow hedges: | ||||
Change in unrealized gains | 105 | 120 | 257 | 241 |
Reclassification adjustment for net (gains) losses included in net income (loss) | (68) | (77) | (126) | (46) |
Net change in cash flow hedges | 37 | 43 | 131 | 195 |
Pension and other postretirement plans: | ||||
Recognition of actuarial net gain from pension and other postretirement plans | 1 | 0 | 8 | 0 |
Reclassification adjustments for net (gains) losses from pension and other | 0 | 0 | 0 | 0 |
Net change in actuarial net gain from pension and other postretirement plans | 1 | 0 | 8 | 0 |
Total other comprehensive loss, net of tax expense of $0 and $5, respectively, and $7 and $7, respectively | (40) | (212) | (97) | (410) |
Comprehensive income (loss), net of tax | 4,192 | (673) | 4,464 | (1,409) |
Less: Net income attributable to non-controlling interests | 816 | 38 | 852 | 136 |
Less: Other comprehensive income (loss) attributable to non-controlling interests | 0 | 1 | 1 | (4) |
Comprehensive income (loss) attributable to Dell Technologies Inc. | $ 3,376 | $ (712) | $ 3,611 | $ (1,541) |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - Parenthetical - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
Tax expense (benefit) | $ 0 | $ 5 | $ 7 | $ 7 |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 6 Months Ended | |
Aug. 02, 2019 | Aug. 03, 2018 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 4,561 | $ (999) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Depreciation and amortization | 3,114 | 3,845 |
Stock-based compensation expense | 564 | 415 |
Deferred income taxes | (5,541) | (679) |
Provision for doubtful accounts — including financing receivables | 76 | 81 |
Impairments | 619 | 0 |
Other | 5 | 98 |
Changes in assets and liabilities, net of effects from acquisitions and dispositions: | ||
Accounts receivable | 632 | 76 |
Financing receivables | (362) | (748) |
Inventories | 503 | (1,136) |
Other assets | (1,010) | (520) |
Accounts payable | 240 | 2,630 |
Deferred revenue | 1,482 | 1,117 |
Accrued and other liabilities | (921) | (388) |
Change in cash from operating activities | 3,962 | 3,792 |
Investments: | ||
Purchases | (70) | (888) |
Maturities and sales | 430 | 1,322 |
Capital expenditures | (1,083) | (561) |
Capitalized software development costs | (184) | (160) |
Acquisition of businesses, net | (384) | 0 |
Divestitures of businesses, net | 0 | 142 |
Asset acquisitions, net | 0 | (38) |
Asset dispositions, net | (3) | (6) |
Other | 11 | 27 |
Change in cash from investing activities | (1,283) | (162) |
Cash flows from financing activities: | ||
Share repurchases for tax withholdings of equity awards | (363) | (199) |
Proceeds from the issuance of common stock of subsidiaries | 151 | 653 |
Repurchases of common stock of subsidiaries | (1,044) | 0 |
Proceeds from debt | 12,201 | 4,637 |
Repayments of debt | (13,911) | (6,948) |
Other | 44 | (130) |
Change in cash from financing activities | (2,922) | (1,987) |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | (62) | (216) |
Change in cash, cash equivalents, and restricted cash | (305) | 1,427 |
Cash, cash equivalents, and restricted cash at beginning of the period | 10,240 | 14,378 |
Cash, cash equivalents, and restricted cash at end of the period | $ 9,935 | $ 15,805 |
CONDENSED CONSOLIDATED STATEM_7
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) shares in Millions, $ in Millions | Total | Common Stock and Capital in Excess of Par ValueDHI Group | Common Stock and Capital in Excess of Par ValueClass V Common Stock | Treasury StockDHI Group | Treasury StockClass V Common Stock | Accumulated Deficit | Accumulated Other Comprehensive Income/(Loss) | Dell Technologies Stockholders' Equity | Non-Controlling Interests |
Balance, beginning of period (in shares) at Feb. 02, 2018 | 571 | 223 | 1 | 24 | |||||
Balance, beginning of period at Feb. 02, 2018 | $ 17,485 | $ 9,848 | $ 10,041 | $ (16) | $ (1,424) | $ (6,860) | $ 130 | $ 11,719 | $ 5,766 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | (999) | (1,135) | (1,135) | 136 | |||||
Foreign currency translation adjustments | (603) | (603) | (603) | ||||||
Investments, net change | (2) | (2) | |||||||
Cash flow hedges, net change | 195 | 197 | 197 | (2) | |||||
Pension and other post-retirement | 0 | ||||||||
Issuance of common stock | (4) | (4) | (4) | ||||||
Stock-based compensation expense | 415 | 37 | 37 | 378 | |||||
Treasury stock repurchases (in shares) | (1) | ||||||||
Treasury stock repurchases | (47) | $ (47) | (47) | ||||||
Revaluation of redeemable shares | (1,672) | (1,672) | (1,672) | ||||||
Impact from equity transactions of non-controlling interests | 448 | $ 71 | 71 | 377 | |||||
Balance, end of period (in shares) at Aug. 03, 2018 | 571 | 223 | 2 | 24 | |||||
Balance, end of period at Aug. 03, 2018 | 15,211 | $ 8,280 | $ 10,041 | $ (63) | $ (1,424) | (7,937) | (334) | 8,563 | 6,648 |
Balance, beginning of period (in shares) at May. 04, 2018 | 570 | 223 | 1 | 24 | |||||
Balance, beginning of period at May. 04, 2018 | 16,980 | $ 9,480 | $ 10,041 | $ (53) | $ (1,424) | (7,438) | (121) | 10,485 | 6,495 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | (461) | (499) | (499) | 38 | |||||
Foreign currency translation adjustments | (261) | (261) | (261) | ||||||
Investments, net change | 6 | 5 | 5 | 1 | |||||
Cash flow hedges, net change | 43 | 43 | 43 | ||||||
Pension and other post-retirement | 0 | ||||||||
Issuance of common stock (in shares) | 1 | ||||||||
Issuance of common stock | (1) | $ (1) | (1) | ||||||
Stock-based compensation expense | 216 | 15 | 15 | 201 | |||||
Treasury stock repurchases (in shares) | (1) | ||||||||
Treasury stock repurchases | (10) | $ (10) | (10) | ||||||
Revaluation of redeemable shares | (1,212) | (1,212) | (1,212) | ||||||
Impact from equity transactions of non-controlling interests | (89) | $ (2) | (2) | (87) | |||||
Balance, end of period (in shares) at Aug. 03, 2018 | 571 | 223 | 2 | 24 | |||||
Balance, end of period at Aug. 03, 2018 | 15,211 | $ 8,280 | $ 10,041 | $ (63) | $ (1,424) | (7,937) | (334) | 8,563 | 6,648 |
Balance, beginning of period (in shares) at Feb. 01, 2019 | 721 | 2 | |||||||
Balance, beginning of period at Feb. 01, 2019 | (942) | $ 16,114 | $ (63) | (21,349) | (467) | (5,765) | 4,823 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | 4,561 | 3,709 | 3,709 | 852 | |||||
Foreign currency translation adjustments | (236) | (236) | (236) | ||||||
Investments, net change | 0 | ||||||||
Cash flow hedges, net change | 131 | 130 | 130 | 1 | |||||
Pension and other post-retirement | 8 | 8 | 8 | ||||||
Issuance of common stock (in shares) | 5 | ||||||||
Issuance of common stock | 85 | $ 85 | 85 | ||||||
Stock-based compensation expense | 564 | 104 | 104 | 460 | |||||
Treasury stock repurchases | (2) | $ (2) | (2) | ||||||
Revaluation of redeemable shares | 172 | 172 | 172 | ||||||
Impact from equity transactions of non-controlling interests | (1,249) | $ (519) | (138) | (657) | (592) | ||||
Balance, end of period (in shares) at Aug. 02, 2019 | 726 | 2 | |||||||
Balance, end of period at Aug. 02, 2019 | 3,095 | $ 15,956 | $ (65) | (17,775) | (565) | (2,449) | 5,544 | ||
Balance, beginning of period (in shares) at May. 03, 2019 | 721 | 2 | |||||||
Balance, beginning of period at May. 03, 2019 | (1,661) | $ 15,179 | $ (65) | (21,053) | (525) | (6,464) | 4,803 | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Net income (loss) | 4,232 | 3,416 | 3,416 | 816 | |||||
Foreign currency translation adjustments | (78) | (78) | (78) | ||||||
Investments, net change | 0 | ||||||||
Cash flow hedges, net change | 37 | 37 | 37 | ||||||
Pension and other post-retirement | 1 | 1 | 1 | ||||||
Issuance of common stock (in shares) | 5 | ||||||||
Issuance of common stock | 88 | $ 88 | 88 | ||||||
Stock-based compensation expense | 301 | 62 | 62 | 239 | |||||
Revaluation of redeemable shares | 750 | 750 | 750 | ||||||
Impact from equity transactions of non-controlling interests | (575) | $ (123) | (138) | (261) | (314) | ||||
Balance, end of period (in shares) at Aug. 02, 2019 | 726 | 2 | |||||||
Balance, end of period at Aug. 02, 2019 | $ 3,095 | $ 15,956 | $ (65) | $ (17,775) | $ (565) | $ (2,449) | $ 5,544 |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 6 Months Ended |
Aug. 02, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | NOTE 1 — BASIS OF PRESENTATION References in these Notes to the Condensed Consolidated Financial Statements to the “Company” or “Dell Technologies” mean Dell Technologies Inc. individually and together with its consolidated subsidiaries. Basis of Presentation — The accompanying unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and accompanying Notes filed with the U.S. Securities and Exchange Commission (“SEC”) in the Company’s Annual Report on Form 10-K for the fiscal year ended February 1, 2019 . These Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In the opinion of management, the accompanying Condensed Consolidated Financial Statements reflect all adjustments of a normal recurring nature considered necessary to fairly state the financial position of Dell Technologies Inc. as of August 2, 2019 and February 1, 2019 , the results of its operations and corresponding comprehensive income (loss) for the three and six months ended August 2, 2019 and August 3, 2018 , and its cash flows for the six months ended August 2, 2019 and August 3, 2018 . The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the Condensed Consolidated Financial Statements and the accompanying Notes. Actual results could differ materially from those estimates. The results of operations and comprehensive income (loss) for the three and six months ended August 2, 2019 and August 3, 2018 and the cash flows for the six months ended August 2, 2019 and August 3, 2018 are not necessarily indicative of the results to be expected for the full fiscal year or for any other fiscal period. The Company’s fiscal year is the 52- or 53-week period ending on the Friday nearest January 31. The fiscal year ended February 1, 2019 (“Fiscal 2019”) was a 52-week period, and the fiscal year ending January 31, 2020 (“Fiscal 2020”) will be a 52-week period. Principles of Consolidation — These Condensed Consolidated Financial Statements include the accounts of Dell Technologies and its wholly-owned subsidiaries, as well as the accounts of VMware, Inc., Pivotal Software, Inc. (“Pivotal”), and SecureWorks Corp. (“Secureworks”), each of which is majority-owned by Dell Technologies. All intercompany transactions have been eliminated. Unless the context indicates otherwise, references in these Notes to the Condensed Consolidated Financial Statements to “VMware” mean the VMware reportable segment, which reflects the operations of VMware, Inc. (NYSE: VMW) within Dell Technologies. EMC Merger Transaction — On September 7, 2016 , the Company completed its acquisition of EMC Corporation (“EMC”) by merger (the “EMC merger transaction”). The consolidated results of EMC are included in Dell Technologies’ consolidated results presented in these financial statements. Pivotal Initial Public Offering — On April 24, 2018, Pivotal, which is majority-owned by Dell Technologies, completed a registered underwritten initial public offering (“IPO”) of its Class A common stock (NYSE: PVTL). The results of Pivotal’s operations are included in other businesses. For more information regarding the Company’s ownership of Pivotal, see Note 13 and Note 20 of the Notes to the Condensed Consolidated Financial Statements . Recently Issued Accounting Pronouncements Measurement of Credit Losses on Financial Instruments — In June 2016, the Financial Accounting Standards Board (“FASB”) issued amended guidance which replaces the current incurred loss impairment methodology for measurement of credit losses on financial instruments with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. Public entities must adopt the new guidance for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted for fiscal periods beginning after December 15, 2018. The Company is currently evaluating the impact that the standard will have on the Condensed Consolidated Financial Statements. Intangibles - Goodwill and Other - Internal-Use Software — In August 2018, the FASB issued guidance on a customer’s accounting for implementation costs incurred in a cloud-computing arrangement when hosted by a vendor. In a hosting arrangement that is a service contract, certain implementation costs should be capitalized and amortized over the term of the arrangement. Public entities must adopt the new guidance for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted for fiscal periods beginning after December 15, 2018. The Company does not expect the adoption of this guidance to have a material impact on the Condensed Consolidated Financial Statements. Recently Adopted Accounting Pronouncements Leases — In February 2016, the FASB issued amended guidance on the accounting for leasing transactions. The primary objective of this update is to increase transparency and comparability among organizations by requiring lessees to recognize a lease liability for the obligation to make lease payments and a right-of-use (“ROU”) asset for the right to use the underlying asset for the lease term. The guidance also results in some changes to lessor accounting and requires additional disclosures about all leasing arrangements. The Company adopted the standard (the “new lease standard”) as of February 2, 2019 using a modified retrospective approach, with the cumulative-effect adjustment to the opening balance of stockholders’ equity (deficit) as of the adoption date. The Company elected to apply the practical expedient using the transition option whereby prior comparative periods were not retrospectively adjusted in the Consolidated Financial Statements. Accordingly, prior comparative periods have not been adjusted in the Condensed Consolidated Financial Statements. The Company also elected the package of practical expedients which does not require reassessment of initial direct costs, classification of a lease, and definition of a lease. The adoption of the new lease standard resulted in the recognition of $1.6 billion in operating lease liabilities and related ROU assets on the Consolidated Statements of Financial Position. The Company recorded an immaterial adjustment to stockholders’ equity (deficit) as of February 2, 2019 to reflect the cumulative effect of adoption of the new lease standard. As of February 2, 2019, there were no material finance leases for which the Company was a lessee. In the area of lessor accounting, as of February 2, 2019, the Company began to originate operating leases due to the elimination of third-party residual value guarantee insurance from the sales-type lease classification test. Leases that commenced prior to the adoption of the new lease standard were not reassessed or restated pursuant to the practical expedients elected. Accordingly, there was no cumulative adjustment to stockholders’ equity (deficit) related to lessor accounting. See Note 4 and Note 5 of the Notes to the Condensed Consolidated Financial Statements for additional information about the Company’s leases from a lessor and lessee perspective, respectively. |
INTERIM UPDATE TO SUMMARY OF SI
INTERIM UPDATE TO SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Aug. 02, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
INTERIM UPDATE TO SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 — INTERIM UPDATE TO SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES As discussed in Note 1 of the Notes to the Condensed Consolidated Financial Statements , the Company adopted the new lease standard as of February 2, 2019, using the modified retrospective method. A lease is defined as a contract that conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company enters into contracts that are, or contain, leases as both a lessee and a lessor. The following accounting policies have been updated as part of the adoption of the new lease standard. Accounting for Operating Leases as a Lessee — In its ordinary course of business, the Company enters into leases as a lessee for office buildings, warehouses, employee vehicles, and equipment. The Company determines if an arrangement is a lease or contains a lease at inception. Operating leases result in the recognition of ROU assets and lease liabilities on the Consolidated Statements of Financial Position. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease, measured on a discounted basis. At lease inception, the lease liability is measured at the present value of the lease payments over the lease term. The operating lease ROU asset equals the lease liability adjusted for any initial direct costs, prepaid or deferred rent, and lease incentives. The Company uses the implicit rate when readily determinable. As most of the leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date to determine the present value of lease payments. Incremental borrowing rates used to determine the present value of lease payments were derived by reference to the Company’s secured-debt yields corresponding to the lease commencement date. The lease term may include options to extend or to terminate the lease that the Company is reasonably certain to exercise. Lease expense is recognized on a straight-line basis over the lease term in most instances. The Company has elected not to record leases with an initial term of 12 months or less on the Consolidated Statements of Financial Position. Lease expense on such leases is recognized on a straight-line basis over the lease term. The Company does not generate material sublease income and has no material related party leases. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company’s office building agreements contain costs such as common area maintenance and other executory costs that are variable in nature. Variable lease costs are expensed as incurred. The Company combines lease and non-lease components, such as common area and other maintenance costs, in calculating the ROU assets and lease liabilities for its office buildings and employee vehicles. Under certain service agreements with third-party logistics providers, the Company directs the use of the inventory within the warehouses and, therefore, controls the assets. The warehouses and some of the equipment used are considered embedded leases. The Company accounts for the lease and non-lease components separately. The lease components consist of the warehouses and some of the equipment, such as conveyor belts. The non-lease components consist of services and other shared equipment, such as material handling and transportation. The Company allocates the consideration to the lease and non-lease components using their relative standalone values. See Note 5 of the Notes to the Condensed Consolidated Financial Statements for additional information. Accounting for Leases as a Lessor — The Company’s wholly-owned subsidiary Dell Financial Services and its affiliates (“DFS”) acts as a lessor to provide equipment financing to customers through a variety of lease arrangements (“DFS leases”). Subsequent to the adoption of the new lease standard, new DFS leases are classified as sales-type leases, direct financing leases, or operating leases. Direct financing leases under the new lease standard are immaterial. Leases that commenced prior to the adoption of the new lease standard were not reassessed or restated pursuant to the practical expedients elected and will continue to be accounted for under previous lease accounting guidance. When a contract includes lease and non-lease components, DFS allocates consideration under the contract to each component based on relative standalone selling price. Whenever the terms of the lease transfer control to the lessee, the contract is typically classified as a sales-type lease. Through these arrangements, the lessee has the right to substantially all of the economic benefits from use of the identified asset and has the right to direct the use of such asset during the period of use. In many arrangements, the lessee also retains ownership at the end of the lease term. On commencement of sales-type leases, the Company recognizes profit up-front, and amounts due from the customer under the lease contract are recognized as financing receivables on the Consolidated Statements of Financial Position. Interest income is recognized as Net revenue over the term of the lease based on the effective interest method. For sales and other taxes collected from the lessee, the Company has elected not to include such taxes as part of lease revenue. All other leases which do not meet the definition of a sales-type lease or direct financing lease are classified as operating leases. The underlying asset in an operating lease arrangement is carried at depreciated cost as “Equipment under operating leases” within Property, plant, and equipment, net on the Consolidated Statements of Financial Position. Depreciation is calculated using the straight-line method over the term of the underlying lease contract and is recognized as Cost of net revenue. The depreciable basis is the original cost of the equipment less the estimated residual value of the equipment at the end of the lease term. The Company recognizes operating lease revenue on a straight-line basis over the lease term and expenses deferred initial direct costs on the same basis. Impairment of equipment under operating leases is assessed on the same basis as other long-lived assets. DFS provides lessees with the option to extend the lease or purchase the underlying asset at the end of the lease term, which is considered when evaluating lease classification. In general, DFS’s lease arrangements do not have variable payment terms and are non-cancelable. See Note 4 of the Notes to the Condensed Consolidated Financial Statements for more information regarding DFS leasing arrangements. Financing Receivables — Financing receivables are presented net of allowance for losses and consist of customer receivables and residual interest. Customer receivables, gross includes amounts due from customers under revolving loans, fixed-term loans, fixed-term sales-type or direct financing leases, and accrued interest. The Company has two portfolios, consisting of: (1) fixed-term leases and loans and (2) revolving loans, and assesses risk at the portfolio level to determine the appropriate allowance levels. The portfolio segments are further segregated into classes based on products, customer type, and credit risk evaluation: (1) Revolving - Dell Preferred Account (“DPA”); (2) Revolving - Dell Business Credit (“DBC”); and (3) Fixed-term - Consumer and Commercial. Fixed-term leases and loans are offered to qualified small and medium-sized businesses, large commercial accounts, governmental organizations, and educational entities. Additionally, fixed-term loans are also offered to certain individual consumer customers. Revolving loans are offered under private label credit financing programs. The DPA revolving loan programs are offered to individual consumer customers and the DBC revolving loan programs are offered to small and medium-sized business customers. The Company retains a residual interest in equipment leased under its fixed-term lease programs. The amount of the residual interest is established at the inception of the lease based upon estimates of the value of the equipment at the end of the lease term using historical studies, industry data, and future value-at-risk demand valuation methods. On a quarterly basis, the Company assesses the carrying amount of its recorded residual values for impairment. Anticipated declines in specific future residual values that are considered to be other-than-temporary are recorded currently in earnings. Generally, residual value risk on equipment under lease is not considered to be significant because of the existence of a secondary market with respect to the equipment. The lease agreement also clearly defines applicable return conditions and remedies for non-compliance, to ensure that the leased equipment will be in good operating condition upon return. Model changes and updates, as well as market strength and product acceptance, are monitored and adjustments are made to residual values in accordance with the significance of any such changes. Remarketing sales staff works closely with customers and dealers to manage the sale of lease returns and the recovery of residual exposure. As of August 2, 2019 , the Company has not recorded significant residual value impairment. Asset Securitization — The Company transfers certain U.S. and European customer loan and lease payments and associated equipment to Special Purpose Entities (“SPEs”) that meet the definition of a Variable Interest Entity (“VIE”) and are consolidated into the Consolidated Financial Statements. These SPEs are bankruptcy-remote legal entities with separate assets and liabilities. The purpose of the SPEs is to facilitate the funding of customer lease and loan payments and associated equipment in the capital markets. These SPEs have entered into financing arrangements with multi-seller conduits that, in turn, issue asset-backed debt securities in the capital markets. The asset securitizations in the SPEs are accounted for as secured borrowings. See Note 4 of the Notes to the Condensed Consolidated Financial Statements for additional information on the impact of the consolidation. |
FAIR VALUE MEASUREMENTS AND INV
FAIR VALUE MEASUREMENTS AND INVESTMENTS | 6 Months Ended |
Aug. 02, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS AND INVESTMENTS | NOTE 3 — FAIR VALUE MEASUREMENTS AND INVESTMENTS The following table presents the Company’s hierarchy for its assets and liabilities measured at fair value on a recurring basis as of the dates indicated: August 2, 2019 February 1, 2019 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Quoted Significant Significant Quoted Significant Significant (in millions) Assets: Cash and cash equivalents: Money market funds $ 4,832 $ — $ — $ 4,832 $ 5,221 $ — $ — $ 5,221 Equity and other securities 8 — — 8 314 20 — 334 Derivative instruments — 251 — 251 — 97 — 97 Total assets $ 4,840 $ 251 $ — $ 5,091 $ 5,535 $ 117 $ — $ 5,652 Liabilities: Derivative instruments $ — $ 36 $ — $ 36 $ — $ 60 $ — $ 60 Total liabilities $ — $ 36 $ — $ 36 $ — $ 60 $ — $ 60 The following section describes the valuation methodologies the Company uses to measure financial instruments at fair value: Money Market Funds — The Company’s investment in money market funds that are classified as cash equivalents hold underlying investments with a weighted average maturity of 90 days or less and are recognized at fair value. The valuations of these securities are based on quoted prices in active markets for identical assets, when available, or pricing models whereby all significant inputs are observable or can be derived from or corroborated by observable market data. The Company reviews security pricing and assesses liquidity on a quarterly basis. As of August 2, 2019 , the Company’s U.S. portfolio had no material exposure to money market funds with a fluctuating net asset value. Equity and Other Securities — The Company’s investments in equity and other securities that are measured at fair value on a recurring basis consist primarily of strategic investments in publicly-traded companies. The valuation of these securities is based on quoted prices in active markets. Derivative Instruments — The Company’s derivative financial instruments consist primarily of foreign currency forward and purchased option contracts and interest rate swaps. The fair value of the portfolio is determined using valuation models based on market observable inputs, including interest rate curves, forward and spot prices for currencies, and implied volatilities. Credit risk is also factored into the fair value calculation of the Company’s derivative instrument portfolio. See Note 7 of the Notes to the Condensed Consolidated Financial Statements for a description of the Company’s derivative financial instrument activities. Deferred Compensation Plans —The Company offers deferred compensation plans for eligible employees, which allow participants to defer payment for a portion of their compensation. Assets were the same as liabilities associated with the plans at approximately $226 million and $192 million as of August 2, 2019 and February 1, 2019 , respectively, and are included in other assets and other liabilities on the Condensed Consolidated Statements of Financial Position . The net impact to the Condensed Consolidated Statements of Income (Loss) is not material since changes in the fair value of the assets substantially offset changes in the fair value of the liabilities. As such, assets and liabilities associated with these plans have not been included in the above table. These fair values were determined based on observable market prices in a less active market or based on valuation methodologies using observable inputs and were categorized as Level 2 in the fair value hierarchy. Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis — Certain assets are measured at fair value on a nonrecurring basis and therefore are not included in the recurring fair value table above. These assets consist primarily of non-financial assets such as goodwill and intangible assets. See Note 8 of the Notes to the Condensed Consolidated Financial Statements for additional information about goodwill and intangible assets. As of August 2, 2019 and February 1, 2019 , the Company held private strategic investments of $760 million and $671 million , respectively. As these investments represent early-stage companies without readily determinable fair values, they are not included in the recurring fair value table above. The Company has elected to apply the measurement alternative for these investments. Under the alternative, the Company measures investments without readily determinable fair values at cost, less impairment, adjusted by observable price changes. The Company must make a separate election to use the alternative for each eligible investment and is required to reassess at each reporting period whether an investment qualifies for the alternative. In evaluating these investments for impairment or observable price changes, the Company uses inputs including pre- and post-money valuations of recent financing events and the impact of those on its fully diluted ownership percentages, as well as other available information regarding the issuer’s historical and forecasted performance. Carrying Value and Estimated Fair Value of Outstanding Debt — The following table presents the carrying value and estimated fair value of the Company’s outstanding debt as described in Note 6 of the Notes to the Condensed Consolidated Financial Statements , including the current portion, as of the dates indicated: August 2, 2019 February 1, 2019 Carrying Value Fair Value Carrying Value Fair Value (in billions) Senior Secured Credit Facilities $ 9.4 $ 9.5 $ 12.5 $ 12.6 First Lien Notes $ 20.5 $ 22.8 $ 19.8 $ 21.0 Unsecured Notes and Debentures $ 1.2 $ 1.4 $ 1.8 $ 1.9 Senior Notes $ 3.2 $ 3.4 $ 3.1 $ 3.4 EMC Notes $ 3.0 $ 3.0 $ 3.0 $ 2.9 VMware Notes $ 4.0 $ 4.0 $ 4.0 $ 3.9 Margin Loan Facility $ 4.0 $ 4.0 $ 3.3 $ 3.4 The fair values of the outstanding debt shown in the table above, as well as the DFS debt described in Note 4 of the Notes to the Condensed Consolidated Financial Statements , were determined based on observable market prices in a less active market or based on valuation methodologies using observable inputs and were categorized as Level 2 in the fair value hierarchy. The carrying value of DFS debt approximates fair value. Investments The following table presents the carrying value of the Company’s strategic investments in publicly-traded and privately-held companies as of the dates indicated: August 2, 2019 February 1, 2019 Cost Unrealized Gain Unrealized (Loss) Carrying Value Cost Unrealized Gain Unrealized (Loss) Carrying Value (in millions) Equity and other securities $ 715 $ 78 $ (25 ) $ 768 $ 638 $ 539 $ (172 ) $ 1,005 For the six months ended August 2, 2019 , the equity and other securities without readily determinable fair values increased by $78 million , due to upward adjustments for observable price changes, offset by $8 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. |
FINANCIAL SERVICES
FINANCIAL SERVICES | 6 Months Ended |
Aug. 02, 2019 | |
Receivables [Abstract] | |
FINANCIAL SERVICES | The Company offers or arranges various financing options, services, and alternative payment structures for its customers in North America, Europe, Australia, and New Zealand through DFS. The Company also arranges financing for some of its customers in various countries where DFS does not currently operate as a captive enterprise. The key activities of DFS include originating, collecting, and servicing customer financing arrangements primarily related to the purchase or use of Dell Technologies products and services. In some cases, DFS also offers financing on the purchase of third-party technology products that complement the Dell Technologies portfolio of products and services. New financing originations were $2.0 billion and $1.9 billion for the three months ended August 2, 2019 and August 3, 2018 , respectively, and were $3.7 billion and $3.6 billion for the six months ended August 2, 2019 and August 3, 2018 , respectively. The Company’s lease and loan arrangements with customers are aggregated into the following categories: • 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 leases and loans — The Company enters into financing arrangements with customers who seek lease financing for equipment they might otherwise purchase. Under the new lease standard discussed in Note 1 and Note 2 of the Notes to the Condensed Consolidated Financial Statements , new DFS leases are classified as sales-type leases, direct financing leases, or operating leases. When the terms of the DFS lease transfer control of the underlying asset to the lessee, the contract is typically classified as a sales-type lease. Direct financing leases under the new lease standard are immaterial. All other new DFS leases are classified as operating leases. Leases that commenced prior to the adoption of the new lease standard were not reassessed or restated pursuant to the practical expedients elected and will continue to be accounted for under previous lease accounting guidance. Leases with business customers have fixed terms of generally two to four years . 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. Financing Receivables The following table presents the components of the Company’s financing receivables segregated by portfolio segment as of the dates indicated: August 2, 2019 February 1, 2019 Revolving Fixed-term Total Revolving Fixed-term Total (in millions) Financing receivables, net: Customer receivables, gross (a) $ 778 $ 7,544 $ 8,322 $ 835 $ 7,249 $ 8,084 Allowances for losses (67 ) (71 ) (138 ) (75 ) (61 ) (136 ) Customer receivables, net 711 7,473 8,184 760 7,188 7,948 Residual interest — 639 639 — 674 674 Financing receivables, net $ 711 $ 8,112 $ 8,823 $ 760 $ 7,862 $ 8,622 Short-term $ 711 $ 3,762 $ 4,473 $ 760 $ 3,638 $ 4,398 Long-term $ — $ 4,350 $ 4,350 $ — $ 4,224 $ 4,224 ____________________ (a) Customer receivables, gross includes amounts due from customers under revolving loans, fixed-term loans, fixed-term sales-type or direct financing leases, and accrued interest. The following tables present the changes in allowance for financing receivable losses for the periods indicated: Three Months Ended August 2, 2019 August 3, 2018 Revolving Fixed-term Total Revolving Fixed-term Total (in millions) Allowance for financing receivable losses: Balances at beginning of period $ 70 $ 73 $ 143 $ 77 $ 62 $ 139 Charge-offs, net of recoveries (15 ) (9 ) (24 ) (19 ) (12 ) (31 ) Provision charged to income statement 12 7 19 17 1 18 Balances at end of period $ 67 $ 71 $ 138 $ 75 $ 51 $ 126 Six Months Ended August 2, 2019 August 3, 2018 Revolving Fixed-term Total Revolving Fixed-term Total (in millions) Allowance for financing receivable losses: Balances at beginning of period $ 75 $ 61 $ 136 $ 81 $ 64 $ 145 Charge-offs, net of recoveries (35 ) (12 ) (47 ) (39 ) (17 ) (56 ) Provision charged to income statement 27 22 49 33 4 37 Balances at end of period $ 67 $ 71 $ 138 $ 75 $ 51 $ 126 Aging The following table presents the aging of the Company’s customer financing receivables, gross, including accrued interest, segregated by class, as of the dates indicated: August 2, 2019 February 1, 2019 Current Past Due — 90 Days Past Due Total Current Past Due — 90 Days Past Due Total (in millions) Revolving — DPA $ 537 $ 47 $ 18 $ 602 $ 583 $ 53 $ 21 $ 657 Revolving — DBC 153 19 4 176 155 19 4 178 Fixed-term — Consumer and Commercial 6,749 688 107 7,544 6,282 878 89 7,249 Total customer receivables, gross $ 7,439 $ 754 $ 129 $ 8,322 $ 7,020 $ 950 $ 114 $ 8,084 Aging is likely to fluctuate year to year as a result of the variability in volume of large transactions entered into over the period, and the administrative processes that accompany those larger transactions. As such, fluctuations in aging do not necessarily indicate a material change in the credit quality of the portfolio. Credit Quality The following table presents customer receivables, gross, including accrued interest, by credit quality indicator segregated by class, as of the dates indicated. The categories shown in the table below segregate customer receivables based on the relative degrees of credit risk. The credit quality indicators for DPA revolving accounts are measured primarily as of each quarter-end date, while all other indicators are generally updated on a periodic basis. August 2, 2019 February 1, 2019 Higher Mid Lower Total Higher Mid Lower Total (in millions) Revolving — DPA $ 121 $ 178 $ 303 $ 602 $ 128 $ 192 $ 337 $ 657 Revolving — DBC $ 45 $ 54 $ 77 $ 176 $ 47 $ 54 $ 77 $ 178 Fixed-term — Consumer and Commercial $ 4,377 $ 1,892 $ 1,275 $ 7,544 $ 3,980 $ 1,984 $ 1,285 $ 7,249 For DPA revolving receivables shown in the table above, the Company makes credit decisions based on proprietary scorecards, which include the customer’s credit history, payment history, credit usage, and other credit agency-related elements. The higher quality category includes prime accounts generally of a higher credit quality that are comparable to U.S. customer FICO scores of 720 or above. The mid-category represents the mid-tier accounts that are comparable to U.S. customer FICO scores from 660 to 719 . The lower category is generally sub-prime and represents lower credit quality accounts that are comparable to U.S. customer FICO scores below 660 . For the DBC revolving receivables and fixed-term commercial receivables shown in the table above, an internal grading system is utilized that assigns a credit level score based on a number of considerations, including liquidity, operating performance, and industry outlook. The grading criteria and classifications for the fixed-term products differ from those for the revolving products as loss experience varies between these product and customer groups. The credit quality categories cannot be compared between the different classes as loss experience varies substantially between the classes. Leases Interest income on sales-type lease receivables was $66 million and $130 million for the three and six months ended August 2, 2019 , respectively. The following table presents the net revenue, cost of net revenue, and gross margin recognized at the commencement date of sales-type leases for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 2, 2019 (in millions) Net revenue — products $ 223 $ 353 Cost of net revenue — products 179 260 Gross margin — products $ 44 $ 93 The following table presents the future maturity of the Company’s fixed-term customer leases and associated financing payments, and reconciles the undiscounted cash flows to the customer receivables, gross recognized on the Condensed Consolidated Statements of Financial Position as of the date indicated: August 2, 2019 Fiscal Years (in millions) Fiscal 2020 (remaining six months) $ 1,488 Fiscal 2021 2,115 Fiscal 2022 1,322 Fiscal 2023 542 Fiscal 2024 and beyond 198 Total undiscounted cash flows 5,665 Fixed-term loans 2,373 Revolving loans 778 Less: unearned income (494 ) Total customer receivables, gross $ 8,322 Disclosure related to periods prior to adoption of the new lease standard — 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. Operating Leases The following table presents the components of the Company’s operating lease portfolio included in Property, plant, and equipment, net as of the date indicated: August 2, 2019 (in millions) Equipment under operating lease, gross $ 455 Less: accumulated depreciation (29 ) Equipment under operating lease, net $ 426 As of February 1, 2019 , the Company’s equipment under operating lease, net was immaterial. Operating lease income relating to lease payments was $27 million and $31 million for the three and six months ended August 2, 2019 , respectively. Depreciation expense was $21 million and $24 million for the three and six months ended August 2, 2019 , respectively. The following table presents the future payments to be received by the Company as lessor in operating lease contracts as of the date indicated: August 2, 2019 Fiscal Years (in millions) Fiscal 2020 (remaining six months) $ 79 Fiscal 2021 140 Fiscal 2022 132 Fiscal 2023 55 Fiscal 2024 and beyond 3 Total $ 409 DFS Debt The Company maintains programs that facilitate the funding of leases, loans, and other alternative payment structures in the capital markets. For DFS debt under securitization programs, the Company’s risk of loss is limited to transferred lease and loan payments and associated equipment, and the credit holders under these programs have no recourse to the Company. The following table presents DFS debt as of the dates indicated. The table excludes the allocated portion of the Company’s other borrowings, which represents the additional amount considered to fund the DFS business. August 2, 2019 February 1, 2019 (in millions) DFS U.S. debt: Securitization facilities $ 2,287 $ 1,914 Fixed-term securitization offerings 2,438 2,303 Other 201 223 Total DFS U.S. debt 4,926 4,440 DFS international debt: Securitization facility 690 584 Other borrowings 831 708 Note payable 198 197 Total DFS international debt 1,719 1,489 Total DFS debt $ 6,645 $ 5,929 Total short-term DFS debt $ 3,703 $ 3,113 Total long-term DFS debt $ 2,942 $ 2,816 DFS U.S. Debt Securitization Facilities — The Company maintains separate securitization facilities in the United States for fixed-term leases and loans and for revolving loans. This debt is collateralized solely by the U.S. loan and lease payments and associated equipment in the facilities. The debt has a variable interest rate and the duration of the debt is based on the terms of the underlying loan and lease payment streams. As of August 2, 2019 , the total debt capacity related to the U.S. securitization facilities was $3.9 billion . The Company enters into interest swap agreements to effectively convert a portion of its securitization debt from a floating rate to a fixed rate. See Note 7 of the Notes to the Condensed Consolidated Financial Statements for additional information about interest rate swaps. The Company’s U.S. securitization facility for revolving loans is effective through June 25, 2022 . The Company’s two U.S. securitization facilities for fixed-term leases and loans are effective through February 22, 2020 and July 26, 2022 , respectively. Subsequent to August 2, 2019 , the Company renewed one of its facilities to extend the effective date from February 22, 2020 to August 22, 2021 , and to increase the total U.S. securitization debt capacity by $0.1 billion . The securitization facilities contain standard structural features related to the performance of the securitized receivables, which include defined credit losses, delinquencies, average credit scores, and minimum collection requirements. In the event one or more of these criteria are not met and the Company is unable to restructure the facility, no further funding of receivables will be permitted and the timing of the Company’s expected cash flows from over-collateralization will be delayed. As of August 2, 2019 , these criteria were met. Fixed-Term Securitization Offerings — The Company periodically issues asset-backed debt securities under fixed-term securitization programs to private investors. The asset-backed debt securities are collateralized solely by the U.S. fixed-term leases and loans in the offerings, which are held by Special Purpose Entities (“SPEs”), as discussed below. The interest rate on these securities is fixed and ranges from 2.14% to 3.97% per annum, and the duration of these securities is based on the terms of the underlying lease and loan payment streams. DFS International Debt Securitization Facility — The Company maintains a securitization facility in Europe for fixed-term leases and loans. This facility is effective through December 21, 2020 and has a total debt capacity of $887 million as of August 2, 2019 . The securitization facility contains standard structural features related to the performance of the securitized receivables which include defined credit losses, delinquencies, average credit scores, and minimum collection requirements. In the event one or more of these criteria are not met and the Company is unable to restructure the program, no further funding of receivables will be permitted and the timing of the Company’s expected cash flows from over-collateralization will be delayed. As of August 2, 2019 , these criteria were met. Other Borrowings — In connection with the Company’s international financing operations, the Company has entered into revolving structured financing debt programs related to its fixed-term lease and loan products sold in Canada, Europe, Australia, and New Zealand. The Canadian facility, which is collateralized solely by Canadian loan and lease payments and associated equipment, had a total debt capacity of $227 million as of August 2, 2019 , and is effective through January 16, 2023 . The European facility, which is collateralized solely by European loan and lease payments and associated equipment, had a total debt capacity of $665 million as of August 2, 2019 , and is effective through December 14, 2020 . The Australia and New Zealand facility, which is collateralized solely by Australia and New Zealand loan and lease payments and associated equipment, had a total debt capacity of $190 million as of August 2, 2019 , and is effective through January 29, 2020 . Note Payable — On November 27, 2017 , the Company entered into an unsecured credit agreement to fund receivables in Mexico. As of August 2, 2019 , the aggregate principal amount of the note payable is $198 million . The note bears interest at either the applicable London Interbank Offered Rate (“LIBOR”) plus 2.25% , for the borrowings denominated in U.S. dollars, or the Mexican Interbank Equilibrium Interest Rate (“TIIE”) plus 2.00% , for the borrowings denominated in Mexican pesos. The note will mature on December 1, 2020 . Although the note is unsecured, the Company intends to manage the note in the same manner as its structured financing programs, so that the collections from loan and lease payments and associated equipment in Mexico will be used to pay down principal and interest of the note. Variable Interest Entities In connection with the securitization facilities and offerings discussed above, the Company transfers certain U.S. and European loan and lease payments and associated equipment to SPEs that meet the definition of a Variable Interest Entity (“VIE”) and are consolidated, along with the associated debt detailed above, into the Consolidated Financial Statements, as the Company is the primary beneficiary of those VIEs. The SPEs are bankruptcy-remote legal entities with separate assets and liabilities. The purpose of the SPEs is to facilitate the funding of loan and lease payments and associated equipment in the capital markets. The following table presents financing receivables and equipment under operating leases, net held by the consolidated VIEs as of the dates indicated: August 2, 2019 February 1, 2019 (in millions) Assets held by consolidated VIEs, net: Short-term, net $ 3,072 $ 2,940 Long-term, net 3,011 2,508 Assets held by consolidated VIEs, net $ 6,083 $ 5,448 Loan and lease payments and associated equipment transferred via securitization through SPEs were $1.3 billion and $1.2 billion for the three months ended August 2, 2019 and August 3, 2018 , respectively, and $2.8 billion and $2.5 billion for the six months ended August 2, 2019 and August 3, 2018 , respectively. Some of the SPEs have entered into financing arrangements with multi-seller conduits that, in turn, issue asset-backed debt securities in the capital markets. The DFS debt outstanding, which is collateralized by the loan and lease payments and associated equipment held by the consolidated VIEs, was $5.4 billion and $4.8 billion as of August 2, 2019 and February 1, 2019 , respectively. The Company’s risk of loss related to securitized receivables is limited to the amount by which the Company’s right to receive collections for assets securitized exceeds the amount required to pay interest, principal, and fees and expenses related to the asset-backed securities. The Company provides credit enhancement to the securitization in the form of over-collateralization. Customer Receivable Sales To manage certain concentrations of customer credit exposure, the Company may sell selected fixed-term customer receivables to unrelated third parties on a periodic basis. The amount of customer receivables sold was $246 million and $271 million for the six months ended August 2, 2019 and August 3, 2018 , respectively. |
LEASES
LEASES | 6 Months Ended |
Aug. 02, 2019 | |
Leases [Abstract] | |
LEASES | NOTE 5 — LEASES The Company enters into leasing transactions in which the Company is lessee. These lease contracts are typically classified as operating leases. The Company’s lease contracts are generally for office buildings used to conduct its business, and the determination of whether such contracts contain leases generally does not require significant estimates or judgments. The Company also leases certain global logistics warehouses, employee vehicles, and equipment. As of August 2, 2019 , the remaining terms of the Company’s leases range from one year to 27 years. The Company also enters into leasing transactions in which the Company is lessor, primarily through customer financing arrangements offered through DFS. DFS originates leases that are primarily classified as either sales-type leases or operating leases. See Note 4 of the Notes to the Condensed Consolidated Financial Statements for more information on the DFS lease portfolio and related lease disclosures. In adopting the new lease standard discussed in Note 1 and Note 2 of the Notes to the Condensed Consolidated Financial Statements , the Company elected to apply a transition method that does not require the retrospective application to periods prior to adoption. Financial information associated with the Company’s leases in which the Company is lessee is contained in this footnote. As of August 2, 2019 , there were no material finance leases for which the Company was a lessee. The following table presents components of lease costs included in the Condensed Consolidated Statements of Income (Loss) for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 2, 2019 (in millions) Operating lease costs $ 126 $ 243 Variable costs 41 79 Total lease costs $ 167 $ 322 During the six months ended August 2, 2019 , sublease income, finance lease costs, and short-term lease costs were immaterial. The following table presents supplemental information related to operating leases included in the Condensed Consolidated Statements of Financial Position as of the date indicated: Classification August 2, 2019 (in millions, except for term and discount rate) Operating lease ROU assets Other non-current assets $ 1,630 Current operating lease liabilities Accrued and other current liabilities $ 412 Non-current operating lease liabilities Other non-current liabilities 1,234 Total operating lease liabilities $ 1,646 Weighted-average remaining lease term (in years) 8.82 Weighted-average discount rate 3.99 % The following table presents supplemental cash flow information related to leases for the period indicated: Six Months Ended August 2, 2019 (in millions) Cash paid for amounts included in the measurement of lease liabilities - $ 241 ROU assets obtained in exchange for new operating lease liabilities $ 254 The following table presents the future maturity of the Company’s operating lease liabilities under non-cancelable leases and reconciles the undiscounted cash flows for these leases to the lease liability recognized on the Condensed Consolidated Statements of Financial Position as of the date indicated: August 2, 2019 Fiscal Years (in millions) Fiscal 2020 (remaining six months) $ 224 Fiscal 2021 419 Fiscal 2022 321 Fiscal 2023 234 Fiscal 2024 153 Thereafter 696 Total lease payments $ 2,047 Less: Imputed interest (401 ) Total $ 1,646 Current operating lease liabilities $ 412 Non-current operating lease liabilities $ 1,234 The amount of future lease commitments after Fiscal 2024 is primarily for the ground lease on VMware, Inc.’s Palo Alto, California headquarter facilities, which expires in Fiscal 2047. As of August 2, 2019 , the Company has additional operating leases that have not yet commenced of $393 million . These operating leases will commence during Fiscal 2020 and Fiscal 2021 with lease terms of one year to 16 years. Disclosure related to periods prior to adoption of the new lease standard Prior to the adoption of the new lease standard, the Company had the following future minimum lease payments under non-cancelable leases: February 1, 2019 Fiscal Years (in millions) Fiscal 2020 $ 371 Fiscal 2021 314 Fiscal 2022 240 Fiscal 2023 175 Fiscal 2024 113 Thereafter 643 Total $ 1,856 |
DEBT
DEBT | 6 Months Ended |
Aug. 02, 2019 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 6 — DEBT The following table presents the Company’s outstanding debt as of the dates indicated: August 2, 2019 February 1, 2019 (in millions) Secured Debt Senior Secured Credit Facilities: 4.24% Term Loan B Facility due September 2023 $ 4,913 $ 4,938 4.16% Term Loan A-2 Facility due September 2021 — 4,116 3.99% Term Loan A-4 Facility due December 2023 1,009 1,650 4.25% Term Loan A-5 Facility due December 2019 — 2,016 4.07% Term Loan A-6 Facility due March 2024 3,588 — First Lien Notes: 3.48% due June 2019 — 3,750 4.42% due June 2021 4,500 4,500 5.45% due June 2023 3,750 3,750 4.00% due July 2024 1,000 — 6.02% due June 2026 4,500 4,500 4.90% due October 2026 1,750 — 5.30% due October 2029 1,750 — 8.10% due July 2036 1,500 1,500 8.35% due July 2046 2,000 2,000 Unsecured Debt Unsecured Notes and Debentures: 5.875% due June 2019 — 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: 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 4) 6,645 5,929 Other 4.51% Margin Loan Facility due April 2022 4,000 3,350 Other 85 38 Total debt, principal amount $ 52,592 $ 54,239 August 2, 2019 February 1, 2019 (in millions) Total debt, principal amount $ 52,592 $ 54,239 Unamortized discount, net of unamortized premium (252 ) (271 ) Debt issuance costs (418 ) (447 ) Total debt, carrying value $ 51,922 $ 53,521 Total short-term debt, carrying value $ 5,949 $ 4,320 Total long-term debt, carrying value $ 45,973 $ 49,201 During the six months ended August 2, 2019 , the Company repaid the remaining principal amount of approximately $1,277 million of its Term Loan A-2 Facility described below under “Refinancing Transactions,” $620 million principal amount of its Term Loan A-4 Facility, $600 million principal amount of its 5.875% senior notes due June 2019 upon maturity, and approximately $91 million of principal amortization under its term loan facilities. Additionally, during the six months ended August 2, 2019 , the Company issued an additional $0.7 billion , net, in DFS debt to support the expansion of its financing receivables portfolio. Refinancing Transactions On March 7, 2019, the Company amended the Margin Loan Agreement to increase the aggregate principal amount of borrowings under the Margin Loan Facility by $650 million . On March 13, 2019, the Company entered into an amendment to the credit agreement for the Senior Secured Credit Facilities to obtain a new senior secured Term Loan A-6 Facility in order to refinance the $5 billion aggregate principal amount of debt incurred in connection with the Class V transaction described in Note 14 of the Notes to the Condensed Consolidated Financial Statements . The Term Loan A-6 Facility aggregate principal amount of $3,634 million matures on March 13, 2024, of which $2,839 million aggregate principal amount represents the amounts outstanding under the Term Loan A-2 Facility that rolled-over into the new facility. Immediately after the rollover, an aggregate principal amount of $1,277 million remained outstanding under the Term Loan A-2 Facility. The Term Loan A-6 Facility amortizes quarterly and bears interest at the London Interbank Offered Rate (“LIBOR”) plus an applicable margin ranging from 1.25% to 2.00% or a base rate plus an applicable margin of 0.25% to 1.00% . On March 20, 2019, Dell International L.L.C. and EMC Corporation, both which are wholly-owned subsidiaries of Dell Technologies Inc., completed a private offering of multiple series of First Lien Notes in an aggregate principal amount of $4.5 billion . The principal amount, interest rate, and maturity of each series of such First Lien Notes were $1,000 million of 4.00% First Lien Notes due July 15, 2024 , $1,750 million of 4.90% First Lien Notes due October 1, 2026 , and $1,750 million of 5.30% First Lien Notes due October 1, 2029 . A majority of the proceeds from the First Lien Notes issued on March 20, 2019 was used to repay all of the outstanding $3,750 million First Lien Notes due June 2019. In addition, proceeds of approximately $800 million of borrowings under the new Term Loan A-6 Facility, the proceeds of the $650 million increase in the Margin Loan Facility, and a portion of the proceeds from the 2019 First Lien Notes were used to repay all of the Company’s outstanding amounts under the Term Loan A-5 Facility due December 2019. During the three months ended May 3, 2019 , the remaining proceeds available from the 2019 First Lien Notes were used to repay $550 million of outstanding amounts under the Term Loan A-2 Facility and to pay related premiums, accrued interest, fees, and expenses. The Term Loan A-2 Facility was subsequently paid off as of August 2, 2019 . The refinancing and amendments were evaluated in accordance with FASB ASC 470, “Debt-Modifications and Extinguishments.” The amendment to the Margin Loan Agreement and the term debt refinancing were accounted for as modifications for all existing lenders and as new issuances for new lenders. The First Lien Notes issued on March 20, 2019 were accounted for as new issuances for all lenders, and repayment of the Company’s outstanding amounts under the Term Loan A-5 Facility was accounted for as an extinguishment. During the three months ended May 3, 2019 , the Company capitalized $74.5 million in new fees paid to creditors as a result of the modifications and new issuances. In addition, the Company recognized expenses of $32.3 million in unamortized costs and $7.1 million in new third-party costs during the three months ended May 3, 2019 . Secured Debt Senior Secured Credit Facilities — The Company has entered into a credit agreement that provides for senior secured credit facilities (the “Senior Secured Credit Facilities”) comprising (a) term loan facilities and (b) a senior secured Revolving Credit Facility, which includes capacity for up to $0.5 billion of letters of credit and for borrowings of up to $0.4 billion under swing-line loans. As of August 2, 2019 , available borrowings under the Revolving Credit Facility totaled $4.5 billion . The Senior Secured Credit Facilities provide that the borrowers have the right at any time, subject to customary conditions, to request incremental term loans or incremental revolving commitments. Borrowings under the Senior Secured Credit Facilities bear interest at a rate per annum equal to an applicable margin, plus, at the borrowers’ option, either (a) a base rate, which, under the Term Loan B Facility, is subject to an interest rate floor of 1.75% per annum, and under all other borrowings is subject to an interest rate floor of 0% per annum, or (b) LIBOR, which, under the Term Loan B Facility, is subject to an interest rate floor of 0.75% per annum, and under all other borrowings is subject to an interest rate floor of 0% per annum. Interest is payable, in the case of loans bearing interest based on LIBOR, at the end of each interest period (but at least every three months), in arrears and, in the case of loans bearing interest based on the base rate, quarterly in arrears. The Term Loan B Facility amortizes in equal quarterly installments in aggregate annual amounts equal to 1% of the original principal amount. The Term Loan A-4 Facility amortizes in equal quarterly installments in aggregate annual amounts equal to 5% of the original principal amount in each of the first four years after the facility closing date of December 20, 2018, and 80% of the original principal amount in the fifth year after December 20, 2018. The Term Loan A-6 Facility amortizes in equal quarterly installments in aggregate annual amounts equal to 5% of the original principal amount in each of the first four years after the facility closing date of March 13, 2019, and 80% of the original principal amount in the fifth year after March 13, 2019. The Revolving Credit Facility has no amortization. The borrowers may voluntarily repay outstanding loans under the term loan facilities and the Revolving Credit Facility at any time without premium or penalty, other than customary “breakage” costs. All obligations of the borrowers under the Senior Secured Credit Facilities and certain swap agreements, cash management arrangements, and certain letters of credit provided by any lender or agent party to the Senior Secured Credit Facilities or any of its affiliates and certain other persons are secured by (a) a first-priority security interest in certain tangible and intangible assets of the borrowers and the guarantors and (b) a first-priority pledge of 100% of the capital stock of the borrowers, Dell Inc., a wholly‑owned subsidiary of the Company ( “ Dell ” ), and each wholly-owned material restricted subsidiary of the borrowers and the guarantors, in each case subject to certain thresholds, exceptions, and permitted liens. First Lien Notes — The senior secured notes (collectively, the “First Lien Notes”) were issued on June 1, 2016 and March 20, 2019 in an aggregate principal amount of $20.0 billion and $4.5 billion , respectively. As stated above, the Company used a portion of the $4.5 billion proceeds to repay all of the outstanding $3,750 million First Lien Notes due June 2019. Interest on these borrowings is payable semiannually. The First Lien Notes are secured on a pari passu basis with the Senior Secured Credit Facilities, on a first-priority basis by substantially all of the tangible and intangible assets of the issuers and guarantors that secure obligations under the Senior Secured Credit Facilities, including pledges of all capital stock of the issuers, Dell, and certain wholly-owned material subsidiaries of the issuers and the guarantors, subject to certain exceptions. The Company has agreed to use commercially reasonable efforts to register with the SEC notes having terms substantially identical to the terms of the First Lien Notes as part of an offer to exchange such registered notes for the First Lien Notes. The Company will be obligated to pay additional interest on the First Lien Notes if it fails to consummate such an exchange offer within five years after the closing date of the EMC merger transaction, in the case of the First Lien Notes issued on June 1, 2016, and within five years after their issue date, in the case of the First Lien Notes issued on March 20, 2019. . China Revolving Credit Facility — During the three months ended May 3, 2019, the Company renewed its credit agreement (the “China Revolving Credit Facility”) with a bank lender for a secured revolving loan facility in an aggregate principal amount not to exceed $500 million at an interest rate of LIBOR plus 0.6% per annum. The facility will expire on February 26, 2020. As of August 2, 2019 , there were no outstanding borrowings under the China Revolving Credit Facility. Unsecured Debt Unsecured Notes and Debentures — The Company has outstanding unsecured notes and debentures (collectively, the “Unsecured Notes and Debentures”) that were issued by Dell prior to the acquisition of Dell by Dell Technologies Inc. in the going-private transaction that closed in October 2013. Interest on these borrowings is payable semiannually. Senior Notes — The senior unsecured notes (collectively, the “Senior Notes”) were issued on June 22, 2016 in an aggregate principal amount of $3.25 billion . Interest on these borrowings is payable semiannually. EMC Notes — On September 7, 2016 , EMC had outstanding $2.5 billion aggregate principal amount of its 1.875% Notes due June 2018, which the Company fully repaid during the three months ended August 3, 2018, $2.0 billion aggregate principal amount of its 2.650% Notes due June 2020, and $1.0 billion aggregate principal amount of its 3.375% Notes due June 2023 (collectively, the “EMC Notes”). Interest on these borrowings is payable semiannually. VMware Notes — On August 21, 2017, VMware, Inc. completed a public offering of unsecured senior notes in the aggregate amount of $4.0 billion , consisting of outstanding principal due on the following dates: $1.25 billion due August 21, 2020, $1.5 billion due August 21, 2022, and $1.25 billion due August 21, 2027 (collectively, the “VMware Notes”). The VMware Notes bear interest, payable semiannually, at annual rates of 2.30% , 2.95% , and 3.90% , respectively. None of the net proceeds of such borrowings will be made available to support the operations or satisfy any corporate purposes of Dell Technologies, other than the operations and corporate purposes of VMware, Inc. and VMware, Inc.’s subsidiaries. VMware Revolving Credit Facility — On September 12, 2017, VMware, Inc. entered into an unsecured credit agreement, establishing a revolving credit facility (the “VMware Revolving Credit Facility”) with a syndicate of lenders that provides the company with a borrowing capacity of up to $1.0 billion which may be used for VMware, Inc. general corporate purposes. Commitments under the VMware Revolving Credit Facility are available for a period of five years , which may be extended, subject to the satisfaction of certain conditions, by up to two one year periods. The credit agreement contains certain representations, warranties, and covenants. Commitment fees, interest rates, and other terms of borrowing under the VMware Revolving Credit Facility may vary based on VMware, Inc.’s external credit ratings. None of the net proceeds of such borrowings will be made available to support the operations or satisfy any corporate purposes of Dell Technologies, other than the operations and corporate purposes of VMware, Inc. and VMware, Inc.’s subsidiaries. As of August 2, 2019 , there were no outstanding borrowings under the VMware Revolving Credit Facility. DFS Debt See Note 4 and Note 7 of the Notes to the Condensed Consolidated Financial Statements , respectively, for discussion of DFS debt and the interest rate swap agreements that hedge a portion of that debt. Other Margin Loan Facility — On April 12, 2017, the Company entered into the Margin Loan Facility in an aggregate principal amount of $2.0 billion . In connection with the Class V transaction, on December 20, 2018, the Company amended the Margin Loan Facility to increase the aggregate principal amount to $3.35 billion . In connection with obtaining the Term Loan A-6 Facility, the Company increased the aggregate principal amount of the facility to $4.0 billion . VMW Holdco LLC, a wholly-owned subsidiary of EMC, is the borrower under the Margin Loan Facility, which is secured by 60 million shares of Class B common stock of VMware, Inc. and 20 million shares of Class A common stock of VMware, Inc. Loans under the Margin Loan Facility bear interest at a rate per annum payable, at the borrower’s option, either at (a) a base rate plus 1.25% per annum or (b) a LIBOR-based rate plus 2.25% per annum. Interest under the Margin Loan Facility is payable quarterly. The Margin Loan Facility will mature in April 2022. The borrower may voluntarily repay outstanding loans under the Margin Loan Facility at any time without premium or penalty, other than customary “breakage” costs, subject to certain minimum threshold amounts for prepayment. Pivotal Revolving Credit Facility — On September 7, 2017, Pivotal entered into a credit agreement (the “Pivotal Revolving Credit Facility”) that provides for a senior secured revolving loan facility in an aggregate principal amount not to exceed $100 million . The credit facility contains customary representations, warranties, and covenants, including financial covenants. The credit agreement will expire on September 8, 2020, unless it is terminated earlier. None of the net proceeds of borrowings under the facility will be made available to support the operations or satisfy any corporate purposes of Dell Technologies, other than the operations and corporate purposes of Pivotal and Pivotal’s subsidiaries. As of August 2, 2019 , there were no outstanding borrowings under the Pivotal Revolving Credit Facility. Aggregate Future Maturities The following table presents the aggregate future maturities of the Company’s debt as of August 2, 2019 for the periods indicated: Maturities by Fiscal Year 2020 (remaining six months) 2021 2022 2023 2024 Thereafter Total (in millions) Senior Secured Credit Facilities and First Lien Notes $ 116 $ 174 $ 4,732 $ 290 $ 11,722 $ 13,226 $ 30,260 Unsecured Notes and Debentures — — 400 — — 952 1,352 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 2,140 3,051 980 438 36 — 6,645 Margin Loan Facility — — — 4,000 — — 4,000 Other 13 18 7 8 7 32 85 Total maturities, principal amount 2,269 6,493 7,744 6,236 12,765 17,085 52,592 Associated carrying value adjustments — (5 ) (78 ) (28 ) (142 ) (417 ) (670 ) Total maturities, carrying value amount $ 2,269 $ 6,488 $ 7,666 $ 6,208 $ 12,623 $ 16,668 $ 51,922 Covenants and Unrestricted Net Assets — The credit agreement for the Senior Secured Credit Facilities contains customary negative covenants that generally limit the ability of Denali Intermediate Inc., a wholly-owned subsidiary of Dell Technologies (“Dell Intermediate”), Dell, and Dell’s and Denali Intermediate’s other restricted subsidiaries to incur debt, create liens, make fundamental changes, enter into asset sales, make certain investments, pay dividends or distribute or redeem certain equity interests, prepay or redeem certain debt, and enter into certain transactions with affiliates. The indenture governing the Senior Notes contains customary negative covenants that generally limit the ability of Denali Intermediate, Dell, and Dell’s and Denali Intermediate’s other restricted subsidiaries to incur additional debt or issue certain preferred shares, pay dividends on or make other distributions in respect of capital stock or make other restricted payments, make certain investments, sell or transfer certain assets, create liens on certain assets to secure debt, consolidate, merge, sell, or otherwise dispose of all or substantially all assets, enter into certain transactions with affiliates, and designate subsidiaries as unrestricted subsidiaries. The negative covenants under such credit agreements and indenture are subject to certain exceptions, qualifications, and “baskets.” The indentures governing the First Lien Notes, the Unsecured Notes and Debentures, and the EMC Notes variously impose limitations, subject to specified exceptions, on creating certain liens, entering into sale and lease-back transactions, and entering into certain asset sales. The foregoing credit agreements and indentures contain customary events of default, including failure to make required payments, failure to comply with covenants, and the occurrence of certain events of bankruptcy and insolvency. As of August 2, 2019 , the Company had certain consolidated subsidiaries that were designated as unrestricted subsidiaries for all purposes of the applicable credit agreements and the indentures governing the First Lien Notes and the Senior Notes. Substantially all of the net assets of the Company’s consolidated subsidiaries were restricted, with the exception of the Company’s unrestricted subsidiaries, primarily VMware, Inc., Pivotal, Secureworks, and their respective subsidiaries, as of August 2, 2019 . The Term Loan A-4 Facility, the Term Loan A-6 Facility, and the Revolving Credit Facility are subject to a first lien leverage ratio covenant that is tested at the end of each fiscal quarter of Dell with respect to Dell’s preceding four fiscal quarters. The Company was in compliance with all financial covenants as of August 2, 2019 . |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 6 Months Ended |
Aug. 02, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | NOTE 7 — DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES As part of its risk management strategy, the Company uses derivative instruments, primarily foreign currency forward and option contracts and interest rate swaps, to hedge certain foreign currency and interest rate exposures, respectively. The Company’s objective is to offset gains and losses resulting from these exposures with gains and losses on the derivative contracts used to hedge the exposures, thereby reducing volatility of earnings and protecting the fair values of assets and liabilities. The earnings effects of the derivative instruments are presented in the same income statement line items as the earnings effects of the hedged items. For derivatives designated as cash flow hedges, the Company assesses hedge effectiveness both at the onset of the hedge and at regular intervals throughout the life of the derivative. The Company does not have any derivatives designated as fair value hedges. Foreign Exchange Risk The Company uses foreign currency forward and option contracts designated as cash flow hedges to protect against the foreign currency exchange rate risks inherent in its forecasted transactions denominated in currencies other than the U.S. dollar. Hedge accounting is applied based upon the criteria established by accounting guidance for derivative instruments and hedging activities. The risk of loss associated with purchased options is limited to premium amounts paid for the option contracts. The risk of loss associated with forward contracts is equal to the exchange rate differential from the time the contract is entered into until the time it is settled. The majority of these contracts typically expire in twelve months or less. During the six months ended August 2, 2019 and August 3, 2018 , the Company did not discontinue any cash flow hedges related to foreign exchange contracts that had a material impact on the Company’s results of operations due to the probability that the forecasted cash flows would not occur. The Company uses forward contracts to hedge monetary assets and liabilities denominated in a foreign currency. These contracts generally expire in three months or less, are considered economic hedges, and are not designated for hedge accounting. The change in the fair value of these instruments represents a natural hedge as their gains and losses offset the changes in the underlying fair value of the monetary assets and liabilities due to movements in currency exchange rates. In connection with expanded offerings of DFS in Europe, forward contracts are used to hedge financing receivables denominated in foreign currencies other than Euro. These contracts are not designated for hedge accounting and most expire within three years or less. Interest Rate Risk The Company uses interest rate swaps to hedge the variability in cash flows related to the interest rate payments on structured financing debt. The interest rate swaps economically convert the variable rate on the structured financing debt to a fixed interest rate to match the underlying fixed rate being received on fixed-term customer leases and loans. These contracts are not designated for hedge accounting and most expire within three years or less. Interest rate swaps are utilized to manage the interest rate risk, at a portfolio level, associated with DFS operations in Europe. The interest rate swaps economically convert the fixed rate on financing receivables to a three-month Euribor floating rate basis in order to match the floating rate nature of the banks’ funding pool. These contracts are not designated for hedge accounting and most expire within five years or less. The Company utilizes cross currency amortizing swaps to hedge the currency and interest rate risk exposure associated with the securitization program that was established in Europe in January 2017. The cross currency swaps combine a Euro-based interest rate swap with a British Pound or U.S. Dollar foreign exchange forward contract in which the Company pays a fixed British Pound or U.S. Dollar amount and receives a floating amount in Euros linked to the one-month Euribor. The notional value of the swaps amortizes in line with the expected cash flows and run-off of the securitized assets. The swaps are not designated for hedge accounting and expire within five years or less. Derivative Instruments Notional Amounts of Outstanding Derivative Instruments August 2, 2019 February 1, 2019 (in millions) Foreign exchange contracts: Designated as cash flow hedging instruments $ 8,017 $ 7,573 Non-designated as hedging instruments 6,345 6,129 Total $ 14,362 $ 13,702 Interest rate contracts: Non-designated as hedging instruments $ 3,121 $ 2,674 Effect of Derivative Instruments Designated as Hedging Instruments on the Condensed Consolidated Statements of Financial Position and the Condensed Consolidated Statements of Income (Loss) 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 (in millions) (in millions) For the three months ended August 2, 2019 Total net revenue $ 68 Foreign exchange contracts $ 105 Total cost of net revenue — Interest rate contracts — Interest and other, net — Total $ 105 $ 68 For the three months ended August 3, 2018 Total net revenue $ 77 Foreign exchange contracts $ 120 Total cost of net revenue — Interest rate contracts — Interest and other, net — Total $ 120 $ 77 For the six months ended August 2, 2019 Total net revenue $ 126 Foreign exchange contracts $ 257 Total cost of net revenue — Interest rate contracts — Interest and other, net — Total $ 257 $ 126 For the six months ended August 3, 2018 Total net revenue $ 46 Foreign exchange contracts $ 241 Total cost of net revenue — Interest rate contracts — Interest and other, net — Total $ 241 $ 46 Effect of Derivative Instruments Not Designated as Hedging Instruments on the Condensed Consolidated Statements of Income (Loss) Three Months Ended Six Months Ended August 2, 2019 August 3, 2018 August 2, 2019 August 3, 2018 Location of Gain (Loss) Recognized (in millions) Gain (Loss) Recognized: Foreign exchange contracts $ 7 $ 75 $ (59 ) $ 32 Interest and other, net Interest rate contracts (15 ) (1 ) (22 ) 1 Interest and other, net Total $ (8 ) $ 74 $ (81 ) $ 33 Fair Value of Derivative Instruments in the Condensed Consolidated Statements of Financial Position The Company presents its foreign exchange derivative instruments on a net basis in the Condensed Consolidated Statements of Financial Position due to the right of offset by its counterparties under master netting arrangements. The following tables present the fair value of those derivative instruments presented on a gross basis as of the dates indicated: August 2, 2019 Other Current Other Non- Other Current Other Non-Current Total (in millions) Derivatives designated as hedging instruments: Foreign exchange contracts in an asset position $ 211 $ — $ 3 $ — $ 214 Foreign exchange contracts in a liability position (10 ) — (1 ) — (11 ) Net asset (liability) 201 — 2 — 203 Derivatives not designated as hedging instruments: Foreign exchange contracts in an asset position 278 1 8 — 287 Foreign exchange contracts in a liability position (238 ) — (23 ) (2 ) (263 ) Interest rate contracts in an asset position — 9 — — 9 Interest rate contracts in a liability position — — — (21 ) (21 ) Net asset (liability) 40 10 (15 ) (23 ) 12 Total derivatives at fair value $ 241 $ 10 $ (13 ) $ (23 ) $ 215 February 1, 2019 Other Current Other Non- Other Current Other Non-Current Total (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 The following tables present the gross amounts of the Company’s derivative instruments, amounts offset due to master netting agreements with the Company’s counterparties, and the net amounts recognized in the Condensed Consolidated Statements of Financial Position as of the dates indicated: August 2, 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 $ 510 $ (259 ) $ 251 $ — $ — $ 251 Financial liabilities (295 ) 259 (36 ) — 5 (31 ) Total derivative instruments $ 215 $ — $ 215 $ — $ 5 $ 220 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 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 6 Months Ended |
Aug. 02, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | NOTE 8 — GOODWILL AND INTANGIBLE ASSETS Goodwill The following table presents goodwill allocated to the Company’s business segments and changes in the carrying amount of goodwill as of the dates indicated: Infrastructure Solutions Group Client Solutions Group VMware Other Businesses (a) Total (in millions) Balance as of February 1, 2019 $ 15,199 $ 4,237 $ 16,419 $ 4,234 $ 40,089 Goodwill acquired (b) — — 272 — 272 Impact of foreign currency translation (123 ) — — (33 ) (156 ) Goodwill impaired (c) — — — (207 ) (207 ) Balance as of August 2, 2019 $ 15,076 $ 4,237 $ 16,691 $ 3,994 $ 39,998 ____________________ (a) Other Businesses consists of offerings by Pivotal, Secureworks, RSA Security LLC (“RSA Security”), Virtustream Group Holdings, Inc. (“Virtustream”), and Boomi, Inc. (“Boomi”). (b) VMware, Inc. acquisitions, as discussed below. (c) The Company recognized a goodwill impairment charge related to Virtustream, as discussed below. VMware, Inc. Acquisitions — During the three months ended August 2, 2019 , VMware, Inc. completed the acquisition of Avi Networks, Inc., a provider of multi-cloud application delivery services. The total purchase price was $326 million , net of cash acquired of $9 million . The purchase price primarily included $94 million of identifiable intangible assets and $228 million of goodwill that is no t expected to be deductible for tax purposes. During the three months ended May 3, 2019 , VMware, Inc. completed the acquisition of AetherPal, Inc., a provider of remote support solutions. The total purchase price was $45 million , which primarily included $12 million of identifiable intangible assets and $33 million of goodwill that is no t expected to be deductible for tax purposes. For each of the acquisitions, the initial allocation of the purchase price was based on preliminary valuations and assumptions and is subject to change within the measurement period. VMware, Inc. expects to finalize the allocation of the purchase price for each of the acquisitions as soon as practicable and not later than one year from the respective acquisition dates. See Note 20 of the Notes to the Condensed Consolidated Financial Statements for information regarding acquisition agreements entered into by VMware, Inc. subsequent to August 2, 2019 . Goodwill Impairment Tests — Goodwill and indefinite-lived intangible assets are tested for impairment annually during the third fiscal quarter and whenever events or circumstances may indicate that an impairment has occurred. Based on the results of the annual impairment test performed for the fiscal year ended February 1, 2019 , which was a quantitative test for all goodwill reporting units, the fair values of each of the reporting units, except for the Virtustream reporting unit, exceeded their carrying values. Virtustream’s results, which are reported within the Company’s Other Businesses, do not meet the requirements for a reportable segment and are not material to the Company’s overall results. See Note 18 of the Notes to the Condensed Consolidated Financial Statements for additional segment information. Virtustream delivers an application management cloud platform for enterprise mission-critical workloads in the Infrastructure-as-a-Service market, and had approximately $0.4 billion in goodwill that was derived from the EMC merger transaction during the fiscal year ended February 3, 2017. During fiscal year ended February 1, 2019, Virtustream forecasts were revised downward due to a resetting of the longer-term business model that is focused on a streamlined product portfolio. Based on the results of the annual impairment test performed for the fiscal year ended February 1, 2019 , it was determined that the carrying value of the Virtustream reporting unit exceeded its fair value, and, as such, a goodwill impairment charge of approximately $190 million was recognized during the three months ended November 2, 2018 to write the goodwill down to a fair value of approximately $200 million . During the three months ended August 2, 2019 , strategic alternatives were evaluated for Virtustream that provided new fair value indicators and resulted in the need to perform an impairment assessment of both long-lived assets and goodwill. Based on the results of the impairment assessment, it was determined that the fair value of the asset group was less than its carrying value. A gross impairment charge of $619 million and $524 million net of tax benefits, was recognized related to Virtustream intangible assets, property, plant, and equipment, and remaining goodwill during the three months ended August 2, 2019 . The gross impairment charge related to Virtustream was classified in selling, general, and administrative in the Condensed Consolidated Statements of Income (Loss) . Additionally, required deferred tax adjustments associated with the intangible assets and property, plant, and equipment resulted in the recognition of an income tax benefit of $95 million in the Condensed Consolidated Statements of Income (Loss) . The impairment is reflected in the Condensed Consolidated Statements of Financial Position as of August 2, 2019 as a reduction in Goodwill of $207 million , a reduction in Intangible assets, net of $266 million , a reduction in Property, plant, and equipment, net of $146 million , and a reduction in Other non-current liabilities of $95 million related to deferred income taxes. There were no remaining balances of Virtustream goodwill, intangible assets, or property, plant, and equipment as of August 2, 2019 following the impairment charge recognized during the three months ended August 2, 2019 due to the combined effect of that impairment charge and the Virtustream goodwill impairment charge recognized during the three months ended November 2, 2018. In conjunction with the annual impairment test performed for the fiscal year ended February 1, 2019 , it was determined that the excess of fair value over carrying amount was less than 20% for the RSA Security reporting unit, which had an excess of fair value over carrying amount of 11% as of November 2, 2018. Management continues to monitor the RSA Security goodwill reporting unit and consider potential impacts to the impairment assessment. Following the closing of the Class V transaction described in Note 14 of the Notes to the Condensed Consolidated Financial Statements , the Company performed an interim impairment analysis during the three months ended February 1, 2019 given the availability of market data for the fair value of the Class C Common Stock. Other than the impairment indicators disclosed during the Company’s annual goodwill impairment test during the three months ended November 2, 2018, there were no impairment indicators resulting from the interim impairment analysis. No events or circumstances transpired subsequent to this interim impairment analysis test that would indicate a potential impairment of goodwill as of August 2, 2019 , other than the impairment charge related to Virtustream as discussed above. Management exercised significant judgment related to the above assessments, including the identification of goodwill reporting units, assignment of assets and liabilities to goodwill reporting units, assignment of goodwill to reporting units, and determination of the fair value of each goodwill reporting unit. The fair value of each goodwill reporting unit is generally estimated using a combination of public company multiples and discounted cash flow methodologies, unless the reporting unit relates to a publicly traded entity (VMware, Inc., Pivotal, or Secureworks), in which case the fair value is determined based primarily on the public company market valuation. The discounted cash flow and public company multiples methodologies require significant judgment, including estimation of future cash flows, which is dependent on internal forecasts, current and anticipated economic conditions and trends, selection of market multiples through assessment of the reporting unit’s performance relative to peer competitors, the estimation of the long-term growth rate of the Company’s business, and the determination of the Company’s weighted average cost of capital. Changes in these estimates and assumptions could materially affect the fair value of the goodwill reporting unit, potentially resulting in a non-cash impairment charge. Intangible Assets The following table presents the Company’s intangible assets as of the dates indicated: August 2, 2019 February 1, 2019 Gross Accumulated Net Gross Accumulated Net (in millions) Customer relationships $ 22,712 $ (12,828 ) $ 9,884 $ 22,750 $ (11,703 ) $ 11,047 Developed technology 15,450 (9,941 ) 5,509 15,701 (9,036 ) 6,665 Trade names 1,282 (711 ) 571 1,291 (606 ) 685 Leasehold assets (liabilities) — — — 128 (10 ) 118 Definite-lived intangible assets 39,444 (23,480 ) 15,964 39,870 (21,355 ) 18,515 Indefinite-lived trade names 3,755 — 3,755 3,755 — 3,755 Total intangible assets $ 43,199 $ (23,480 ) $ 19,719 $ 43,625 $ (21,355 ) $ 22,270 Amortization expense related to definite-lived intangible assets was approximately $1.1 billion and $1.5 billion for the three months ended August 2, 2019 and August 3, 2018 , respectively, and $2.3 billion and $3.0 billion for the six months ended August 2, 2019 and August 3, 2018 , respectively. During the three months ended August 2, 2019 , an impairment charge related to Virtustream intangible assets, net was approximately $266 million , as discussed above. There were no material impairment charges related to intangible assets during the three months ended August 3, 2018 . Due to the adoption of the new lease standard discussed in Note 1 and Note 2 of the Notes to the Condensed Consolidated Financial Statements , the Company derecognized all intangible leasehold assets and adjusted the carrying amount of the ROU assets by a corresponding amount as of February 2, 2019. The following table presents the estimated future annual pre-tax amortization expense of definite-lived intangible assets as of the date indicated: August 2, 2019 Fiscal Years (in millions) 2020 (remaining six months) $ 2,095 2021 3,325 2022 2,619 2023 1,743 2024 1,386 Thereafter 4,796 Total $ 15,964 |
DEFERRED REVENUE
DEFERRED REVENUE | 6 Months Ended |
Aug. 02, 2019 | |
Revenue from Contract with Customer [Abstract] | |
DEFERRED REVENUE | NOTE 9 — DEFERRED REVENUE Deferred Revenue — Deferred revenue is recorded for support and deployment services, software maintenance, professional services, training, and SaaS when the Company has a right to invoice or payments have been received for undelivered products or services where transfer of control has not occurred. Revenue is recognized on these items when the revenue recognition criteria are met, generally resulting in ratable recognition over the contract term. The Company also has deferred revenue related to undelivered hardware and professional services, consisting of installations and consulting engagements, which are recognized as the Company’s performance obligations under the contract are completed. The following table presents the changes in the Company’s deferred revenue for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 3, 2018 August 2, 2019 August 3, 2018 (in millions) Deferred revenue: Deferred revenue at beginning of period $ 24,178 $ 20,959 $ 24,010 $ 20,816 Revenue deferrals for new contracts and changes in estimates for pre-existing contracts (a) (b) 5,975 4,988 10,875 9,313 Revenue recognized (b) (4,805 ) (4,247 ) (9,537 ) (8,429 ) Deferred revenue at end of period $ 25,348 $ 21,700 $ 25,348 $ 21,700 Short-term deferred revenue $ 13,568 $ 11,965 $ 13,568 $ 11,965 Long-term deferred revenue $ 11,780 $ 9,735 $ 11,780 $ 9,735 ____________________ (a) Includes the impact of foreign currency exchange rate fluctuations. (b) The Company conformed the presentation of certain deferred revenue rollforward activity for the three and six months ended August 3, 2018 to align current year presentation. The beginning and ending deferred revenue liability balances remain unchanged. Remaining Performance Obligations — Remaining performance obligations represent the aggregate amount of the transaction price allocated to performance obligations not delivered, or partially undelivered, as of the end of the reporting period. Remaining performance obligations include deferred revenue plus unbilled amounts not yet recorded in deferred revenue. The aggregate amount of the transaction price allocated to remaining performance obligations does not include amounts owed under cancelable contracts where there is no substantive termination penalty. The Company applied the practical expedient to exclude the value of remaining performance obligations for contracts for which revenue is recognized at the amount to which the Company has the right to invoice for services performed. The Company also applied the practical expedient to not disclose the amount of transaction price allocated to remaining performance obligations for the periods prior to adoption of the new revenue standard. Remaining performance obligation estimates are subject to change and are affected by several factors, including terminations, changes in the scope of contracts, periodic revalidation, adjustments for revenue that have not materialized, and adjustments for currency. The value of the transaction price allocated to remaining performance obligations as of August 2, 2019 was approximately $33 billion . The Company expects to recognize approximately 61% of remaining performance obligations as revenue in the next twelve months , and the remainder thereafter. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Aug. 02, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | Legal Matters The Company is involved in various claims, suits, assessments, investigations, and legal proceedings that arise from time to time in the ordinary course of its business, including those identified below, consisting of matters involving consumer, antitrust, tax, intellectual property, and other issues on a global basis. The Company accrues a liability when it believes that it is both probable that a liability has been incurred and that it can reasonably estimate the amount of the loss. The Company reviews these accruals at least quarterly and adjusts them to reflect ongoing negotiations, settlements, rulings, advice of legal counsel, and other relevant information. To the extent new information is obtained and the Company’s views on the probable outcomes of claims, suits, assessments, investigations, or legal proceedings change, changes in the Company’s accrued liabilities would be recorded in the period in which such a determination is made. For some matters, the amount of liability is not probable or the amount cannot be reasonably estimated and therefore accruals have not been made. The following is a discussion of the Company’s significant legal matters and other proceedings: Securities Litigation — On May 21, 2014, a securities class action seeking compensatory damages was filed in the United States District Court for the Southern District of New York, captioned City of Pontiac General Employees’ Retirement System v. Dell Inc., et. al. (Case No. 1:14-cv-03644). The action names as defendants Dell Inc. (“Dell”) and certain current and former executive officers, and alleges that Dell made false and misleading statements about Dell’s financial results and future prospects between February 21, 2012 and May 22, 2012, which resulted in artificially inflated stock prices. The case was transferred to the United States District Court for the Western District of Texas under the same caption (Case No. 1:15-cv-00374), where the defendants filed a motion to dismiss. On September 16, 2016, the Court denied the motion to dismiss. On March 29, 2018, the Court granted the plaintiffs’ motion for class certification, and certified a class consisting of all purchasers of Dell common stock between February 22, 2012 and May 22, 2012. Fact and expert discovery is now closed. Dell filed a motion for summary judgment on February 18, 2019, which is pending before the Court. The parties have been engaged in settlement discussions and have agreed to an immaterial settlement amount pending the Court’s preliminary approval in the next few months. Class Actions Related to the Class V Transaction — Four purported stockholders brought putative class action complaints arising out of the Class V transaction described in Note 14 of the Notes to the Condensed Consolidated Financial Statements . The actions were captioned Hallandale Beach Police and Fire Retirement Plan v. Michael Dell et al. (Civil Action No. 2018-0816-JTL), Howard Karp v. Michael Dell et al. (Civil Action No. 2019-0032-JTL), Miramar Police Officers’ Retirement Plan v. Michael Dell et al. (Civil Action No. 2019-0049-JTL), and Steamfitters Local 449 Pension Plan v. Michael Dell et al. (Civil Action No. 2019-0115-JTL). The four actions were consolidated into In Re Dell Class V Litigation (Consol. C.A. No. 2018-0816-JTL), which names as defendants the Company’s board of directors and certain stockholders of the Company, including Michael S. Dell. The plaintiffs generally allege that the defendants breached their fiduciary duties to the former holders of Class V Common Stock in connection with the Class V transaction by allegedly causing the Company to enter into a transaction that favored the interests of the controlling stockholders at the expense of such former stockholders. The plaintiffs filed an amended complaint on August 9, 2019 making substantially similar allegations as described above. The defendants intend to file a motion to dismiss the action, which will be due on September 30, 2019. Copyright Levies — The Company is involved in various proceedings and negotiations regarding Dell’s obligation to collect and remit copyright levies in certain European Union (“EU”) countries. The Company continues to collect levies in EU countries where it has determined that local laws require payment. The Company, along with other companies and/or industry associations, also continues to oppose levy schemes that do not comply with EU law. The Company does not currently anticipate that any of these matters will have a material adverse effect on its business, financial condition, results of operations, or cash flows. Other Litigation — The various legal proceedings in which Dell is involved include commercial and intellectual property litigation. Dell does not currently anticipate that any of these matters will have a material adverse effect on its business, financial condition, results of operations, or cash flows. As of August 2, 2019 , the Company does not believe there is a reasonable possibility that a material loss exceeding the amounts already accrued for these or other proceedings or matters has been incurred. However, since the ultimate resolution of any such proceedings and matters is inherently unpredictable, the Company’s business, financial condition, results of operations, or cash flows could be materially affected in any particular period by unfavorable outcomes in one or more of these proceedings or matters. Whether the outcome of any claim, suit, assessment, investigation, or legal proceeding, individually or collectively, could have a material adverse effect on the Company’s business, financial condition, results of operations, or cash flows will depend on a number of variables, including the nature, timing, and amount of any associated expenses, amounts paid in settlement, damages, or other remedies or consequences. Indemnifications In the ordinary course of business, the Company enters into contractual arrangements under which it may agree to indemnify the third party to such arrangements from any losses incurred relating to the services it performs on behalf of the Company or for losses arising from certain events as defined in the particular contract, such as litigation or claims relating to past performance. Such indemnification obligations may not be subject to maximum loss clauses. Historically, payments related to these indemnifications have not been material to the Company. |
INCOME AND OTHER TAXES
INCOME AND OTHER TAXES | 6 Months Ended |
Aug. 02, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME AND OTHER TAXES | NOTE 11 — INCOME AND OTHER TAXES For the three months ended August 2, 2019 and August 3, 2018 , the Company’s effective income tax rates were 3912.6% and 1.5% , respectively, on pre-tax losses of $111 million and $468 million , respectively. For the six months ended August 2, 2019 and August 3, 2018 , the Company’s effective income tax rates were 1895.7% and 8.4% , respectively, on pre-tax losses of $254 million and $1.1 billion , respectively. The changes in the Company’s effective tax rates are primarily driven by discrete tax items and a change in the Company’s jurisdictional mix of income. During the three months ended May 3, 2019 , the Company completed an intra-entity asset transfer of certain of its intellectual property to an Irish subsidiary, resulting in a discrete tax benefit of $405 million . During the three months ended August 2, 2019 , the Company’s VMware business unit completed a similar transaction, resulting in a discrete tax benefit of $4.5 billion . The tax benefit for each intra-entity asset transfer was recorded as a deferred tax asset in the period of transaction and represents the book and tax basis difference on the transferred assets measured based on the applicable Irish statutory tax rate. The tax deductions for amortization of the assets will be recognized in the future, and any amortization not deducted for tax purposes will be carried forward indefinitely under Irish Tax laws. The Company expects to be able to realize the deferred tax assets resulting from these intra-company asset transfers. For the three and six months ended August 2, 2019 , the Company’s effective tax rates include $273 million discrete tax expense related to certain foreign tax credits associated with U.S. Tax Reform discussed below. The Company’s effective tax rates for the three and six months ended August 2, 2019 also include $95 million of discrete tax benefits relating to Virtustream impairment charges discussed in Note 8 of the Notes to the Condensed Consolidated Financial Statements . For the six months ended August 3, 2018 , the Company’s effective tax rate included $154 million of discrete tax benefits resulting from the impact of its adoption of the new revenue recognition standard during the three months ended May 4, 2018 . The Tax Cuts and Jobs Act of 2017 (“U.S. Tax Reform”) was signed into law on December 22, 2017. Among other things, U.S. Tax Reform lowers the U.S. corporate income tax rate to 21% from 35%, establishes a modified territorial system requiring a mandatory deemed repatriation tax on undistributed earnings of foreign subsidiaries, requires a minimum tax on certain future earnings generated by foreign subsidiaries while providing for future tax-free repatriation of earnings through a 100% dividends-received deduction, and places limitations on the deductibility of net interest expense. The Company anticipates that the U.S. Department of the Treasury and the Internal Revenue Service (“IRS”) will continue to issue regulatory guidance clarifying certain provisions of U.S. Tax Reform. When additional guidance is issued, the Company will recognize the related tax impact in the fiscal quarter of such issuance. The differences between the estimated effective income tax rates and the U.S. federal statutory rate of 21% principally result from the Company’s geographical distribution of income and differences between the book and tax treatment of certain items. In certain jurisdictions, the Company’s tax rate is significantly less than the applicable statutory rate as a result of tax holidays. The majority of the Company’s foreign income that is subject to these tax holidays and lower tax rates is attributable to Singapore, China, and Malaysia. A significant portion of these income tax benefits relates to a tax holiday that will be effective until January 31, 2029. The Company’s other tax holidays will expire in whole or in part during fiscal years 2022 through 2030. Many of these tax holidays and reduced tax rates may be extended when certain conditions are met or may be terminated early if certain conditions are not met. As of August 2, 2019 , the Company was not aware of any matters of non-compliance related to these tax holidays. The Company’s U.S. federal income tax returns for fiscal years 2007 through 2009 are currently under consideration by the Office of Appeals of the IRS. The IRS issued a Revenue Agent’s Report (“RAR”) related to those years during the fiscal year ended February 3, 2017. The IRS has proposed adjustments primarily relating to transfer pricing matters with which the Company disagrees and has been contesting through the IRS administrative appeals process. Although this process has been progressing and the timing of any resolution remains uncertain, the Company anticipates reaching a settlement with the IRS before the end of Fiscal 2020. In May 2017, the IRS commenced a federal income tax audit for fiscal years 2010 through 2014, for which the Company expects to receive a RAR in early 2020. The Company is also currently under income tax audits in various state and foreign jurisdictions. The Company is undergoing negotiations, and in some cases contested proceedings, relating to tax matters with the taxing authorities in these jurisdictions. The Company believes that it has provided adequate reserves related to all matters contained in tax periods open to examination. Although the Company believes it has made adequate provisions for the uncertainties surrounding these audits, should the Company experience unfavorable outcomes, such outcomes could have a material impact on its results of operations, financial position, and cash flows. With respect to major U.S. state and foreign taxing jurisdictions, the Company is generally not subject to tax examinations for years prior to the fiscal year ended February 2, 2007. Judgment is required in evaluating the Company’s uncertain tax positions and determining the Company’s provision for income taxes. The unrecognized tax benefits were $3.5 billion and $3.4 billion as of August 2, 2019 and February 1, 2019 , respectively, and are included in accrued and other and other non-current liabilities in the Condensed Consolidated Statements of Financial Position . Although timing of resolution or closure of audits is not certain, the Company believes it is reasonably possible that certain tax matters in various jurisdictions, including those matters discussed above, could be concluded within the next twelve months. The resolution of these audits could reduce the Company’s unrecognized tax benefits by an estimated amount of between $500 million to $800 million . Such a reduction will have a material effect on the Company’s effective tax rate. The Company takes certain non-income tax positions in the jurisdictions in which it operates and has received certain non-income tax assessments from various jurisdictions. The Company believes that a material loss in these matters is not probable and that it is not reasonably possible that a material loss exceeding amounts already accrued has been incurred. The Company believes its positions in these non-income tax litigation matters are supportable and that it ultimately will prevail in the matters. In the normal course of business, the Company’s positions and conclusions related to its non-income taxes could be challenged and assessments may be made. To the extent new information is obtained and the Company’s views on its positions, probable outcomes of assessments, or litigation change, changes in estimates to the Company’s accrued liabilities would be recorded in the period in which such a determination is made. In the resolution process for income tax and non-income tax audits, the Company is required in certain situations to provide collateral guarantees or indemnification to regulators and tax authorities until the matter is resolved. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 6 Months Ended |
Aug. 02, 2019 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | NOTE 12 — ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Accumulated other comprehensive income (loss) is presented in stockholders’ equity (deficit) in the Condensed Consolidated Statements of Financial Position and consists of amounts related to foreign currency translation adjustments, unrealized net gains (losses) on investments, unrealized net gains (losses) on cash flow hedges, and actuarial net gains (losses) from pension and other postretirement plans. The following table presents changes in accumulated other comprehensive income (loss), net of tax, by the following components as of the dates indicated: Foreign Currency Translation Adjustments Investments Cash Flow Hedges Pension and Other Postretirement Plans Accumulated Other Comprehensive Income (Loss) (in millions) Balances as of February 1, 2019 $ (452 ) $ — $ (29 ) $ 14 $ (467 ) Other comprehensive income (loss) before reclassifications (236 ) — 257 8 29 Amounts reclassified from accumulated other comprehensive income (loss) — — (126 ) — (126 ) Total change for the period (236 ) — 131 8 (97 ) Less: Change in comprehensive income attributable to non-controlling interests — — 1 — 1 Balances as of August 2, 2019 $ (688 ) $ — $ 101 $ 22 $ (565 ) Amounts related to investments are reclassified to net income (loss) when gains and losses are realized. See Note 3 of the Notes to the Condensed Consolidated Financial Statements for more information on the Company’s investments. Amounts related to the Company’s cash flow hedges are reclassified to net income during the same period in which the items being hedged are recognized in earnings. See Note 7 of the Notes to the Condensed Consolidated Financial Statements for more information on the Company’s derivative instruments. The following table presents reclassifications out of accumulated other comprehensive income (loss), net of tax, to net income (loss) for the periods indicated: Three Months Ended August 2, 2019 August 3, 2018 Investments Cash Flow Hedges Total Investments Cash Flow Hedges Total (in millions) Total reclassifications, net of tax: Net revenue $ — $ 68 $ 68 $ — $ 77 $ 77 Cost of net revenue — — — — — — Interest and other, net — — — — — — Total reclassifications, net of tax $ — $ 68 $ 68 $ — $ 77 $ 77 Six Months Ended August 2, 2019 August 3, 2018 Investments Cash Flow Hedges Total Investments Cash Flow Hedges Total (in millions) Total reclassifications, net of tax: Net revenue $ — $ 126 $ 126 $ — $ 46 $ 46 Cost of net revenue — — — — — — Interest and other, net — — — 1 — 1 Total reclassifications, net of tax $ — $ 126 $ 126 $ 1 $ 46 $ 47 |
NON-CONTROLLING INTERESTS
NON-CONTROLLING INTERESTS | 6 Months Ended |
Aug. 02, 2019 | |
Noncontrolling Interest [Abstract] | |
NON-CONTROLLING INTERESTS | NOTE 13 — NON-CONTROLLING INTERESTS VMware, Inc. — The non-controlling interests’ share of equity in VMware, Inc. is reflected as a component of the non-controlling interests in the accompanying Condensed Consolidated Statements of Financial Position and was $4.4 billion and $3.8 billion as of August 2, 2019 and February 1, 2019 , respectively. As of August 2, 2019 and February 1, 2019 , the Company held approximately 80.8% and 80.5% , respectively, of the outstanding equity interest in VMware, Inc. Pivotal — The non-controlling interests’ share of equity in Pivotal is reflected as a component of the non-controlling interest in the accompanying Condensed Consolidated Statements of Financial Position and was $1.0 billion as of August 2, 2019 and February 1, 2019 . As of August 2, 2019 and February 1, 2019 , the Company held approximately 60.9% and 62.8% , respectively, of the outstanding equity interest in Pivotal. Secureworks — The non-controlling interests’ share of equity in Secureworks is reflected as a component of the non-controlling interests in the accompanying Condensed Consolidated Statements of Financial Position and was $87 million as of August 2, 2019 and February 1, 2019 . As of August 2, 2019 and February 1, 2019 , the Company held approximately 87.0% and 87.4% , respectively, of the outstanding equity interest in Secureworks, excluding restricted stock awards (“RSAs”). As of August 2, 2019 and February 1, 2019 , the Company held approximately 86.2% and 86.4% , respectively, of the outstanding equity interest in Secureworks, including RSAs. The following table presents the effect of changes in the Company’s ownership interest in VMware, Inc., Pivotal, and Secureworks on the Company’s equity for the period indicated: Six Months Ended August 2, 2019 (in millions) Net income attributable to Dell Technologies Inc. $ 3,709 Transfers (to)/from the non-controlling interests: Increase in Dell Technologies Inc. additional paid-in-capital for equity issuances and other equity activity 379 Decrease in Dell Technologies Inc. additional paid-in-capital and accumulated deficit for equity issuances and other equity activity (1,036 ) Net transfers to non-controlling interests (657 ) Change from net income attributable to Dell Technologies Inc. and transfers to the non-controlling interests $ 3,052 |
CAPITALIZATION
CAPITALIZATION | 6 Months Ended |
Aug. 02, 2019 | |
Equity [Abstract] | |
CAPITALIZATION | NOTE 14 — CAPITALIZATION The following table presents the Company’s authorized, issued, and outstanding common stock as of the dates indicated: Authorized Issued Outstanding (in millions) Common stock as of August 2, 2019 Class A 600 374 374 Class B 200 119 119 Class C 7,900 233 231 Class D 100 — — Class V 343 — — 9,143 726 724 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 Under the Company’s certificate of incorporation as amended and restated upon the completion of the Class V transaction described below, the Company is prohibited from issuing any of the authorized shares of Class V Common Stock. Preferred Stock The Company is authorized to issue one million shares of preferred stock, par value $0.01 per share. As of August 2, 2019 and February 1, 2019 , no shares of preferred stock were issued or outstanding. Common Stock Common Stock for Fiscal 2020 and Thereafter Dell Technologies Common Stock — For fiscal periods beginning with the first quarter of Fiscal 2020, the Class A Common Stock, the Class B Common Stock, the Class C Common Stock, and the Class D Common Stock, formerly collectively referred to as the DHI Group Common Stock, are collectively referred to as Dell Technologies Common Stock. The redesignation of such classes of common stock from DHI Group Common Stock to Dell Technologies Common Stock is intended to align the Company’s reporting with how such classes are referred to by securities analysts, investors, and other users of the financial statements since the completion on December 28, 2018 of the Class V transaction described below. As a result of the cancellation of all outstanding Class V Common Stock upon the closing of that transaction, there is no requirement after the fourth quarter of Fiscal 2019 to allocate net income (loss) between two separate groups of common stock denoted the DHI Group Common Stock and the Class V Common Stock or to report earnings (loss) per share for each such group. Accordingly, net income (loss), earnings (loss) per share and other relevant information will be reported for Dell Technologies Common Stock for all fiscal periods beginning with the first quarter of Fiscal 2020 and, because of lack of comparability with the new reporting, will be reported separately for the DHI Group and the Class V Common Stock, as applicable, for prior fiscal periods. The par value for all classes of Dell Technologies Common Stock is $0.01 per share. The Class A Common Stock, the Class B Common Stock, the Class C Common Stock, and the Class D Common Stock share equally in dividends declared or accumulated and have equal participation rights in undistributed earnings. Common Stock prior to Fiscal 2020 DHI Group Common Stock and DHI Group — For the fiscal periods prior to the first quarter of Fiscal 2020, the Class A Common Stock, the Class B Common Stock, the Class C Common Stock, and the Class D Common Stock were collectively referred to as the DHI Group Common Stock. All classes of DHI Group Common Stock have a par value of $0.01 per share and the Class A Common Stock, the Class B Common Stock, the Class C Common Stock, and the Class D Common Stock share equally in dividends declared or accumulated and have equal participation rights in undistributed earnings. Prior to the completion on December 28, 2018 of the Class V transaction, the DHI Group referred to the direct and indirect interest of Dell Technologies in all of Del l Technologies’ business, assets, properties, liabilities, and preferred stock other than those attributable to the Class V Group, as well as the DHI Group’s retained interest in the Class V Group. Subsequent to the completion of the Class V transaction, the DHI Group refers to all classes of issued and outstanding DHI G roup Common Stock. Class V Common Stock and Class V Group — The Class V Common Stock was a class of common stock intended to track the performance of a portion of Dell Technologies’ economic interest in the Class V Group. The Class V Group consisted solely of VMware, Inc. common stock held by the Company. As of August 2, 2019 , no shares of Class V Common Stock were outstanding. Voting Rights — Each holder of record of (a) Class A Common Stock is entitled to ten votes per share of Class A Common Stock; (b) Class B Common Stock is entitled to ten votes per share of Class B Common Stock; (c) Class C Common Stock is entitled to one vote per share of Class C Common Stock; and (d) Class D Common Stock is not entitled to any vote on any matter except to the extent required by provisions of Delaware law (in which case such holder is entitled to one vote per share of Class D Common Stock). Conversion Rights — Under the Company’s certificate of incorporation, at any time and from time to time, any holder of Class A Common Stock or Class B Common Stock has the right to convert all or any of the shares of Class A Common Stock or Class B Common Stock, as applicable, held by such holder into shares of Class C Common Stock on a one-to-one basis. During the six months ended August 2, 2019 , the Company issued 35,673,230 shares of Class C Common Stock to stockholders upon their conversion of the same number of shares of Class A Common Stock into Class C Common Stock in accordance with the Company’s certificate of incorporation. During the six months ended August 2, 2019 , the Company issued 17,650,820 shares of Class C Common Stock to stockholders upon their conversion of the same number of shares of Class B Common Stock into Class C Common Stock in accordance with the Company’s certificate of incorporation. Class V Transaction On December 28, 2018 , the Company completed a transaction (the “Class V transaction”) in which it paid $14.0 billion in cash and issued 149,387,617 shares of its Class C Common Stock to holders of the Class V Common Stock in exchange for all outstanding shares of Class V Common Stock. The non-cash consideration portion of the Class V transaction totaled $6.9 billion . As a result of the Class V transaction, the tracking stock feature of the Company’s capital structure associated with the Class V Common Stock was terminated. The Class C Common Stock is traded on the New York Stock Exchange. The aggregate cash consideration and the fees and expenses incurred in connection with the Class V transaction were funded with proceeds of $3.67 billion from new term loans under the Company’s senior secured credit facilities, proceeds of a margin loan financing in an aggregate principal amount of $1.35 billion , proceeds of the Company’s pro-rata portion, in the amount of $8.87 billion , of a special $11 billion cash dividend paid by VMware, Inc. in connection with the Class V transaction, and cash on hand at Dell Technologies and its subsidiaries. See Note 6 of the Notes to the Condensed Consolidated Financial Statements for information about the debt incurred by the Company to finance the Class V transaction. The merger pursuant to which the Class V transaction was effected and the Class V transaction have been accounted for as a hybrid liability and equity transaction involving the repurchase of outstanding common stock, with the consideration consisting of a variable combination of cash and shares. Upon settlement, the accounting for the Class V transaction reflected that the outstanding Class V Common Stock was canceled and exchanged for shares of Class C Common Stock or $120.00 per share in cash or combination of cash and shares, depending on each holder’s election and subject to proration of the cash elections. The variable nature of the cash obligation to repurchase the shares of Class V Common Stock required the Company to settle a portion of the shares in exchange for cash and therefore was accounted for as a financial instrument with an immaterial mark-to-market adjustment for the change in fair value from the date of the stockholder meeting at which the Company’s stockholders voted to approve the Class V transaction to the election deadline by which holders of Class V Common Stock elected the form of consideration for which they exchanged their shares. Repurchases of Common Stock VMware, Inc. Class A Common Stock Repurchases by VMware, Inc. On May 29, 2019, VMware, Inc.’s board of directors authorized the repurchase of an additional $1.5 billion of VMware, Inc.’s Class A common stock. Since the date of the EMC merger transaction, VMware, Inc.’s board of directors has authorized total repurchases of $3.7 billion , of which $1.3 billion remained available as of August 2, 2019 . During the six months ended August 2, 2019 , VMware, Inc. repurchased 5.7 million shares of its Class A common stock in the open market for approximately $1.0 billion , of which approximately $0.1 billion impacted Dell Technologies’ accumulated deficit balance as of August 2, 2019 as a result of the full depletion of VMware, Inc.’s additional paid-in capital balance in the current period. During the six months ended August 3, 2018 , VMware, Inc. did not repurchase any shares of its Class A common stock. All shares repurchased under VMware, Inc.’s stock repurchase programs are retired. |
EARNINGS (LOSS) PER SHARE
EARNINGS (LOSS) PER SHARE | 6 Months Ended |
Aug. 02, 2019 | |
Earnings Per Share [Abstract] | |
EARNINGS (LOSS) PER SHARE | NOTE 15 — EARNINGS (LOSS) PER SHARE Basic earnings (loss) per share is based on the weighted-average effect of all common shares issued and outstanding and is calculated by dividing net income (loss) by the weighted-average shares outstanding during the period. Diluted earnings (loss) per share is calculated by dividing net income (loss) by the weighted-average number of common shares used in the basic earnings (loss) per share calculation plus the number of common shares that would be issued assuming exercise or conversion of all potentially dilutive instruments. The Company excludes equity instruments from the calculation of diluted earnings (loss) per share if the effect of including such instruments is antidilutive. Until the completion on December 28, 2018 of the Class V transaction described in Note 14 of the Notes to the Condensed Consolidated Financial Statements , the Company had two groups of common stock, denoted as the DHI Group Common Stock and the Class V Common Stock. The Class V Common Stock was a class of common stock intended to track the economic performance of 61% of the Company’s interest in the Class V Group, which consisted solely of VMware, Inc. common stock held by the Company. Upon the completion of the Class V transaction, all outstanding shares of Class V Common Stock ceased to be outstanding, and the tracking stock structure was terminated. The Class C Common Stock issued to former holders of the Class V Common Stock in the Class V transaction represents an interest in the Company’s entire business and, unlike the Class V Common Stock, is not intended to track the performance of any distinct assets or business. Prior to Fiscal 2020, the DHI Group Common Stock consists of the Class A Common Stock, the Class B Common Stock, the Class C Common Stock, and the Class D Common Stock. The DHI Group referred to the direct and indirect interest of Dell Technologies in all of Del l Technologies’ business, assets, properties, liabilities, and preferred stock other than those attributable to the Class V Group, as well as the DHI Group’s retained interest in the Class V Group. For fiscal periods beginning with the first quarter of Fiscal 2020, the Class A Common Stock, the Class B Common Stock, the Class C Common Stock, and the Class D Common Stock, formerly collectively referred to as the DHI Group Common Stock, are collectively referred to as Dell Technologies Common Stock. The redesignation of such classes of common stock from DHI Group Common Stock to Dell Technologies Common Stock is intended to align the Company’s reporting with how such classes are referred to by securities analysts, investors, and other users of the financial statements since the completion of the Class V transaction. As a result of the cancellation of all outstanding Class V Common Stock upon the closing of that transaction, there is no requirement after the fourth quarter of Fiscal 2019 to allocate net income (loss) between two separate groups of common stock denoted DHI Group Common Stock and the Class V Common Stock or to report earnings (loss) per share measures for each such group. Accordingly, net income (loss), earnings (loss) per share and other relevant information will be reported for Dell Technologies Common Stock for all fiscal periods beginning with the first quarter of Fiscal 2020 and, because of the lack of comparability with the new reporting, will be reported separately for the DHI Group and the Class V Common Stock, as applicable, for prior fiscal periods. For purposes of calculating earnings (loss) per share, the Company uses the two-class method. As all classes of Dell Technologies Common Stock and DHI Group Common Stock share the same rights in dividends, basic and diluted earnings (loss) per share are the same for each class of both Dell Technologies Common Stock and DHI Group Common Stock. The following table presents the basic and diluted earnings (loss) per share for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 3, 2018 August 2, 2019 August 3, 2018 Earnings (loss) per share attributable to Dell Technologies Inc. - basic: Dell Technologies Common Stock $ 4.75 $ 5.17 Class V Common Stock $ 1.61 $ 3.97 DHI Group $ (1.44 ) $ (3.39 ) Earnings (loss) per share attributable to Dell Technologies Inc. - diluted: Dell Technologies Common Stock $ 4.47 $ 4.84 Class V Common Stock $ 1.58 $ 3.91 DHI Group $ (1.45 ) $ (3.40 ) The following table presents the computation of basic and diluted earnings (loss) per share for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 2, 2019 (in millions) Numerator: Dell Technologies Common Stock Net income attributable to Dell Technologies - basic $ 3,416 $ 3,709 Incremental dilution from VMware, Inc. attributable to Dell Technologies (a) (62 ) (78 ) Net income attributable to Dell Technologies - diluted $ 3,354 $ 3,631 Denominator: Dell Technologies Common Stock weighted-average shares outstanding Weighted-average shares outstanding - basic 719 718 Dilutive effect of options, restricted stock units, restricted stock, and other 32 32 Weighted-average shares outstanding - diluted 751 750 Weighted-average shares outstanding - antidilutive 1 1 ____________________ (a) The incremental dilution from VMware, Inc. represents the impact of VMware, Inc.’s dilutive securities on diluted earnings (loss) per share of Dell Technologies Common Stock, 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. The following table presents the computation of basic and diluted earnings (loss) per share prior to Fiscal 2020 for the periods indicated: Three Months Ended Six Months Ended August 3, 2018 August 3, 2018 (in millions) Numerator: Class V Common Stock Net income attributable to Class V Common Stock - basic $ 320 $ 790 Incremental dilution from VMware, Inc. attributable to Class V Common Stock (a) (5 ) (12 ) Net income attributable to Class V Common Stock - diluted $ 315 $ 778 Numerator: DHI Group Net loss attributable to DHI Group - basic $ (819 ) $ (1,925 ) Incremental dilution from VMware, Inc. attributable to DHI Group (a) (4 ) (8 ) Net loss attributable to DHI Group - diluted $ (823 ) $ (1,933 ) Denominator: Class V Common Stock weighted-average shares outstanding Weighted-average shares outstanding - basic 199 199 Dilutive effect of options, restricted stock units, restricted stock, and other (b) — — Weighted-average shares outstanding - diluted 199 199 Weighted-average shares outstanding - antidilutive (b) — — Denominator: DHI Group weighted-average shares outstanding Weighted-average shares outstanding - basic 567 568 Dilutive effect of options, restricted stock units, restricted stock, and other — — Weighted-average shares outstanding - diluted 567 568 Weighted-average shares outstanding - antidilutive (c) 47 48 ____________________ (a) 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. (b) 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. (c) 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 as to the DHI Group for the periods presented. The following table presents a reconciliation to the consolidated net loss attributable to Dell Technologies Inc. prior to Fiscal 2020 for the periods indicated: Three Months Ended Six Months Ended August 3, 2018 August 3, 2018 (in millions) Net income attributable to Class V Common Stock (a) $ 320 $ 790 Net loss attributable to DHI Group (819 ) (1,925 ) Net loss attributable to Dell Technologies Inc. $ (499 ) $ (1,135 ) ____________________ (a) See Exhibit 99.1 filed with the Company’s Quarterly Report on Form 10-Q for the quarterly period ended August 3, 2018 for a reconciliation of VMware net income to net income attributable to Class V Common Stock. |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 6 Months Ended |
Aug. 02, 2019 | |
Share-based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | NOTE 16 — STOCK-BASED COMPENSATION Dell Technologies Inc. 2013 Stock Incentive Plan (As Amended and Restated as of July, 9, 2019) — During the three months ended August 2, 2019 , the Company’s stockholders approved an amendment to the Dell Technologies Inc. 2013 Stock Incentive Plan (the “Plan”) to authorize an additional 35 million shares of Class C Common Stock for issuance pursuant to the Plan. Upon effectiveness of the amendment, a total of 110.5 million shares of Class C Common Stock are authorized for issuance. As of August 2, 2019, there were 54 million shares of Class C Common Stock available for future grants under the Plan. Restricted Stock Units — During the six months ended August 2, 2019 , the Company granted long-term incentive awards in the form of 10.0 million service-based restricted stock units (“RSUs”) and 1.9 million performance-based RSUs in order to align critical talent retention programs with the interests of holders of the Class C Common Stock. The service-based RSUs have a fair value based on the closing price of the Class C Common Stock price as reported on the New York Stock Exchange (“NYSE”) on the grant date. Most of such RSUs vest ratably over a three -year period. Each service-based RSU represents the right to acquire one share of Class C Common Stock upon vesting. The performance-based RSUs are reflected at target units while the actual number of units that ultimately vest will range from 0% to 200% of target, based on the level of achievement of the performance goals and continued employment with the Company over a performance period ending March 14, 2022. Approximately 0.9 million of the performance-based RSUs are subject to achievement of market-based performance goals based on relative total shareholder return. For the non-market performance-based RSUs, the fair values will be based on the closing price of the Class C Common Stock as reported on the NYSE on the accounting grant date. For the six months ended August 2, 2019 , approximately one-third of the non-market performance awards have been valued and are considered outstanding for accounting purposes. Market-based performance awards utilized a Monte Carlo valuation model to simulate the probabilities of achievement of relative total shareholder return in order to determine the awards’ fair value. The following table presents the assumptions utilized in the valuation model for the period indicated: Six Months Ended August 2, 2019 Weighted-average grant date fair value $ 87.17 Expected term (in years) 3.0 Risk-free rate (U.S. Government Treasury Note) 2.4 % Expected volatility 45 % Expected dividend yield — % As of August 2, 2019 , 15 million RSUs were outstanding, of which 5 million RSUs were subject to performance conditions. The awards outstanding have a weighted-average grant date fair value of $49.80 per share and an aggregate intrinsic value of $812 million based on the closing price of the Class C Common Stock as reported on the NYSE on August 2, 2019 . As of August 2, 2019 , there was $512 million of unrecognized stock-based compensation expense, net of estimated forfeitures, related to these awards expected to be recognized over a weighted-average period of approximately 2.6 years. Stock Options - Of the 42 million stock options outstanding as of February 1, 2019 , 5 million were exercised under the Plan during the six months ended August 2, 2019 with a weighted-average exercise price of $16.74 . Cash proceeds were $88 million and the pre-tax intrinsic value of the options exercised was $189 million during the six months ended August 2, 2019 . |
REDEEMABLE SHARES
REDEEMABLE SHARES | 6 Months Ended |
Aug. 02, 2019 | |
Temporary Equity Disclosure [Abstract] | |
REDEEMABLE SHARES | NOTE 17 — REDEEMABLE SHARES Awards under the Company’s stock incentive plans include certain rights that allow the holder to exercise a put feature for the underlying Class A or Class C Common Stock after a six month holding period following the issuance of such common stock. The put feature requires the Company to purchase the stock at its fair market value. Accordingly, these awards and such common stock are subject to reclassification from equity to temporary equity, and the Company determines the award amounts to be classified as temporary equity as follows: • 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. In connection with the Class V transaction described in Note 14 of the Notes to the Condensed Consolidated Financial Statements , the put feature provisions were amended to provide that the put feature applicable to transfers of Dell Technologies securities will terminate upon the earlier of two years after the expiration on June 27, 2019 of the post-transaction lock-up or consummation of any underwritten public offering of shares of Class C Common Stock. The following table presents the amount of redeemable shares classified as temporary equity and summarizes the award type as of the dates indicated: August 2, 2019 February 1, 2019 (in millions) Redeemable shares classified as temporary equity $ 1,024 $ 1,196 Issued and outstanding unrestricted common shares 2 3 Restricted stock units 1 1 Restricted stock awards — — Outstanding stock options 23 31 The decrease in the value of redeemable shares during the six months ended August 2, 2019 was primarily attributable to a decrease in Class C Common Stock fair value, reassessment of vesting probability for performance-based awards and a reduction in the number of shares eligible for put rights as market sales of shares occur. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Aug. 02, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | NOTE 18 — SEGMENT INFORMATION The Company has three reportable segments that are based on the following business units: Infrastructure Solutions Group (“ISG”); Client Solutions Group (“CSG”); and VMware. ISG enables the digital transformation of the Company’s customers through its trusted multi-cloud and big data solutions, which are built upon a modern data center infrastructure. The ISG 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 the Company’s server portfolio includes high-performance rack, blade, tower, and hyperscale servers. The ISG networking portfolio helps business customers transform and modernize their infrastructure, mobilize and enrich end-user experiences, and accelerate business applications and processes. ISG also offers attached software, peripherals, and services, including support and deployment, configuration, and extended warranty services. CSG includes sales to commercial and consumer customers of branded hardware (such as desktops, workstations, and notebooks) and branded peripherals (such as displays and projectors), as well as services and third-party software and peripherals. CSG also offers attached software, peripherals, and services, including support and deployment, configuration, and extended warranty services. VMware works with customers in the areas of hybrid cloud, multi-cloud, modern applications, networking and security, and digital workspaces, helping customers manage their IT resources across private clouds and complex multi-cloud, multi-device environments. VMware solutions provide a flexible digital foundation to enable the digital transformation of VMware’s customers as they ready their applications, infrastructure, and devices for their future business needs. The reportable segments disclosed herein are based on information reviewed by the Company’s management to evaluate the business segment results. The Company’s measure of segment operating income for management reporting purposes excludes the impact of Other businesses, purchase accounting, amortization of intangible assets, unallocated corporate transactions, other corporate expenses, stock-based compensation expense, and transaction-related expenses. The Company does not allocate assets to the above reportable segments for internal reporting purposes. The following table presents a reconciliation of net revenue by the Company’s reportable segments to the Company’s consolidated net revenue as well as a reconciliation of consolidated segment operating income to the Company’s consolidated operating income (loss) for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 3, 2018 August 2, 2019 August 3, 2018 (in millions) Consolidated net revenue: Infrastructure Solutions Group $ 8,621 $ 9,227 $ 16,823 $ 17,894 Client Solutions Group 11,748 11,128 22,658 21,399 VMware 2,466 2,194 4,748 4,222 Reportable segment net revenue 22,835 22,549 44,229 43,515 Other businesses (a) 619 574 1,215 1,153 Unallocated transactions (b) — (1 ) — (3 ) Impact of purchase accounting (c) (84 ) (180 ) (166 ) (367 ) Total consolidated net revenue $ 23,370 $ 22,942 $ 45,278 $ 44,298 Consolidated operating income (loss): Infrastructure Solutions Group $ 1,050 $ 1,012 $ 1,893 $ 1,951 Client Solutions Group 982 425 1,775 958 VMware 762 736 1,376 1,349 Reportable segment operating income 2,794 2,173 5,044 4,258 Other businesses (a) (25 ) (49 ) (78 ) (99 ) Unallocated transactions (b) (26 ) (16 ) (27 ) (25 ) Impact of purchase accounting (c) (102 ) (215 ) (203 ) (437 ) Amortization of intangibles (1,060 ) (1,526 ) (2,277 ) (3,048 ) Transaction-related expenses (d) (47 ) (104 ) (89 ) (270 ) Stock-based compensation expense (e) (301 ) (216 ) (564 ) (415 ) Other corporate expenses (f) (714 ) (60 ) (737 ) (130 ) Total consolidated operating income (loss) $ 519 $ (13 ) $ 1,069 $ (166 ) ____________________ (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 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) Stock-based compensation expense consists of equity awards granted based on the estimated fair value of those awards at grant date. (f) Other corporate expenses includes impairment charges and severance, facility action, and other costs. See Note 8 of the Notes to the Condensed Consolidated Financial Statements for additional information on Virtustream impairment charges. The following table presents the disaggregation of net revenue by reportable segment, and by major product categories within the segments for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 3, 2018 August 2, 2019 August 3, 2018 (in millions) Net revenue: Infrastructure Solutions Group: Servers and networking $ 4,437 $ 5,061 $ 8,617 $ 9,646 Storage 4,184 4,166 8,206 8,248 Total ISG net revenue 8,621 9,227 16,823 17,894 Client Solutions Group: Commercial 9,077 8,109 17,384 15,472 Consumer 2,671 3,019 5,274 5,927 Total CSG net revenue 11,748 11,128 22,658 21,399 VMware: Total VMware net revenue 2,466 2,194 4,748 4,222 Total segment net revenue $ 22,835 $ 22,549 $ 44,229 $ 43,515 |
SUPPLEMENTAL CONSOLIDATED FINAN
SUPPLEMENTAL CONSOLIDATED FINANCIAL INFORMATION | 6 Months Ended |
Aug. 02, 2019 | |
Condensed Financial Information Disclosure [Abstract] | |
SUPPLEMENTAL CONSOLIDATED FINANCIAL INFORMATION | NOTE 19 — SUPPLEMENTAL CONSOLIDATED FINANCIAL INFORMATION The following table presents additional information on selected accounts included in the Condensed Consolidated Statements of Financial Position as of the dates indicated: August 2, 2019 February 1, 2019 (in millions) Cash, cash equivalents, and restricted cash: Cash and cash equivalents $ 9,193 $ 9,676 Restricted cash - other current assets (a) 616 522 Restricted cash - other non-current assets (a) 126 42 Total cash, cash equivalents, and restricted cash $ 9,935 $ 10,240 Inventories, net: Production materials $ 1,441 $ 1,794 Work-in-process 623 702 Finished goods 1,071 1,153 Total inventories, net $ 3,135 $ 3,649 Other non-current liabilities: Warranty liability $ 170 $ 169 Deferred and other tax liabilities 4,605 5,527 Non-current operating lease liabilities 1,234 — Other 619 631 Total other non-current liabilities $ 6,628 $ 6,327 ____________________ (a) Restricted cash primarily includes cash required to be held in escrow pursuant to DFS securitization arrangements and VMware, Inc. restricted cash. Warranty Liability The following table presents changes in the Company’s liability for standard limited warranties for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 3, 2018 August 2, 2019 August 3, 2018 (in millions) Warranty liability: Warranty liability at beginning of period $ 500 $ 527 $ 524 $ 539 Costs accrued for new warranty contracts and changes in estimates for pre-existing warranties (a) (b) 237 236 440 430 Service obligations honored (212 ) (221 ) (439 ) (427 ) Warranty liability at end of period $ 525 $ 542 $ 525 $ 542 Current portion $ 355 $ 366 $ 355 $ 366 Non-current portion $ 170 $ 176 $ 170 $ 176 ____________________ (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. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Aug. 02, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 20 — SUBSEQUENT EVENTS VMware, Inc. Acquisition Agreements Carbon Black — VMware, Inc. entered into a definitive agreement to acquire Carbon Black, Inc. through a cash tender offer of $26.00 per share, resulting in an expected net cash payment of $1.9 billion by VMware, Inc. Carbon Black, Inc. develops cloud-native endpoint security software. The acquisition has been approved by the boards of directors of both VMware, Inc. and Carbon Black, Inc. and is expected to close during the second half of Fiscal 2020, subject to completion of the tender offer, regulatory approvals and other customary closing conditions. Pivotal — VMware, Inc. entered into a definitive merger agreement (the “Merger Agreement”) to acquire Pivotal at a blended price per share of $11.71 per share, consisting of $15.00 per share in cash to the holders of Pivotal’s Class A common stock, and the exchange of VMware, Inc.’s Class B common stock for Pivotal’s Class B common stock held by Dell Technologies, at an exchange ratio of 0.0550 VMware, Inc. shares for each Pivotal share. In aggregate, this transaction will result in an expected net cash payment of $0.8 billion by VMware, Inc. and the issuance of approximately 7.2 million shares of VMware, Inc.’s Class B common stock to Dell Technologies. The VMware, Inc. Class B common stock issued to Dell Technologies would increase its ownership stake in VMware, Inc. by approximately 0.3 percentage points to 81.1% based on the shares outstanding as of the announcement of the Merger Agreement. The acquisition has been approved by the boards of directors of both VMware, Inc. and Pivotal and is expected to close during the second half of Fiscal 2020, subject to approval of the Merger Agreement by Pivotal stockholders, regulatory approvals and other customary closing conditions. The purchase of Pivotal will be accounted for as a transaction by entities under common control. Assets and liabilities transferred will be recorded at their historical carrying amounts on the date of the transfer, with no goodwill being recognized. Support Agreement — In connection with VMware, Inc.’s entry into the Merger Agreement to acquire Pivotal as described above, Dell Technologies entered into a Consent and Support Agreement (the “Support Agreement”) with EMC Equity Assets LLC (“EMC Equity,” and together with Dell Technologies, the “Dell Stockholders”), VMware, Inc. and, solely with respect to certain sections therein, EMC and VMW Holdco LLC (“VMW Holdco”). Each of EMC Equity, EMC, and VMW Holdco is a wholly owned subsidiary of Dell Technologies. Pursuant to the Support Agreement, the Dell Stockholders have agreed, among other matters and subject to the terms and conditions therein, in their capacity as holders of shares of Pivotal, to vote in favor of adopting the Merger Agreement, the merger and each of the actions contemplated by the Merger Agreement. The Dell Stockholders also have agreed to certain restrictions on transfer of their shares of the Class B common stock of Pivotal, as further set forth in the Support Agreement. Additionally, pursuant to the Support Agreement, EMC and VMW Holdco, together as the holders of all of the outstanding shares of Class B common stock of VMware, Inc., irrevocably have consented to VMware, Inc. entering into the Merger Agreement and the consummation of the transactions contemplated thereby. The Support Agreement provides that, subject to VMware, Inc.’s ability to consummate the Pivotal acquisition and prior to the transaction closing, VMware, Inc. and Dell Technologies will execute an amendment to the tax sharing agreement between the two companies. Commitment For Senior Unsecured Term Loan Facility of VMware, Inc. VMware, Inc. received a commitment from a financial institution for a senior unsecured 364-day term loan facility that would provide VMware, Inc. with a borrowing capacity of up to $2.0 billion (the “Commitment”), which, if funded, may be used for general corporate purposes. The initial funding of the Commitment is subject to various customary conditions, including execution and delivery of the definitive loan agreement and related documentation. Refinancing Transaction On September 5, 2019, the Company initiated a refinancing of its existing $4.9 billion Term Loan B Facility due September 2023, which it intends to replace with a modified $4.0 billion Term Loan B Facility due 2025. The transaction is expected to close on or about September 18, 2019. |
INTERIM UPDATE TO SUMMARY OF _2
INTERIM UPDATE TO SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Aug. 02, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Principles of Consolidation and EMC Merger Transaction | References in these Notes to the Condensed Consolidated Financial Statements to the “Company” or “Dell Technologies” mean Dell Technologies Inc. individually and together with its consolidated subsidiaries. |
Basis of Presentation | Basis of Presentation — The accompanying unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and accompanying Notes filed with the U.S. Securities and Exchange Commission (“SEC”) in the Company’s Annual Report on Form 10-K for the fiscal year ended February 1, 2019 . These Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In the opinion of management, the accompanying Condensed Consolidated Financial Statements reflect all adjustments of a normal recurring nature considered necessary to fairly state the financial position of Dell Technologies Inc. as of August 2, 2019 and February 1, 2019 , the results of its operations and corresponding comprehensive income (loss) for the three and six months ended August 2, 2019 and August 3, 2018 , and its cash flows for the six months ended August 2, 2019 and August 3, 2018 . |
Use of Estimates | The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the Condensed Consolidated Financial Statements and the accompanying Notes. Actual results could differ materially from those estimates. The results of operations and comprehensive income (loss) for the three and six months ended August 2, 2019 and August 3, 2018 and the cash flows for the six months ended August 2, 2019 and August 3, 2018 are not necessarily indicative of the results to be expected for the full fiscal year or for any other fiscal period. |
Fiscal Period | The Company’s fiscal year is the 52- or 53-week period ending on the Friday nearest January 31. The fiscal year ended February 1, 2019 (“Fiscal 2019”) was a 52-week period, and the fiscal year ending January 31, 2020 (“Fiscal 2020”) will be a 52-week period. |
Principles of Consolidation | Principles of Consolidation — These Condensed Consolidated Financial Statements include the accounts of Dell Technologies and its wholly-owned subsidiaries, as well as the accounts of VMware, Inc., Pivotal Software, Inc. (“Pivotal”), and SecureWorks Corp. (“Secureworks”), each of which is majority-owned by Dell Technologies. All intercompany transactions have been eliminated. |
Recently Issued and Adopted Accounting Pronouncements | Recently Issued Accounting Pronouncements Measurement of Credit Losses on Financial Instruments — In June 2016, the Financial Accounting Standards Board (“FASB”) issued amended guidance which replaces the current incurred loss impairment methodology for measurement of credit losses on financial instruments with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. Public entities must adopt the new guidance for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted for fiscal periods beginning after December 15, 2018. The Company is currently evaluating the impact that the standard will have on the Condensed Consolidated Financial Statements. Intangibles - Goodwill and Other - Internal-Use Software — In August 2018, the FASB issued guidance on a customer’s accounting for implementation costs incurred in a cloud-computing arrangement when hosted by a vendor. In a hosting arrangement that is a service contract, certain implementation costs should be capitalized and amortized over the term of the arrangement. Public entities must adopt the new guidance for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted for fiscal periods beginning after December 15, 2018. The Company does not expect the adoption of this guidance to have a material impact on the Condensed Consolidated Financial Statements. Recently Adopted Accounting Pronouncements Leases — In February 2016, the FASB issued amended guidance on the accounting for leasing transactions. The primary objective of this update is to increase transparency and comparability among organizations by requiring lessees to recognize a lease liability for the obligation to make lease payments and a right-of-use (“ROU”) asset for the right to use the underlying asset for the lease term. The guidance also results in some changes to lessor accounting and requires additional disclosures about all leasing arrangements. The Company adopted the standard (the “new lease standard”) as of February 2, 2019 using a modified retrospective approach, with the cumulative-effect adjustment to the opening balance of stockholders’ equity (deficit) as of the adoption date. The Company elected to apply the practical expedient using the transition option whereby prior comparative periods were not retrospectively adjusted in the Consolidated Financial Statements. Accordingly, prior comparative periods have not been adjusted in the Condensed Consolidated Financial Statements. The Company also elected the package of practical expedients which does not require reassessment of initial direct costs, classification of a lease, and definition of a lease. The adoption of the new lease standard resulted in the recognition of $1.6 billion in operating lease liabilities and related ROU assets on the Consolidated Statements of Financial Position. The Company recorded an immaterial adjustment to stockholders’ equity (deficit) as of February 2, 2019 to reflect the cumulative effect of adoption of the new lease standard. As of February 2, 2019, there were no material finance leases for which the Company was a lessee. In the area of lessor accounting, as of February 2, 2019, the Company began to originate operating leases due to the elimination of third-party residual value guarantee insurance from the sales-type lease classification test. Leases that commenced prior to the adoption of the new lease standard were not reassessed or restated pursuant to the practical expedients elected. Accordingly, there was no cumulative adjustment to stockholders’ equity (deficit) related to lessor accounting. See Note 4 and Note 5 of the Notes to the Condensed Consolidated Financial Statements for additional information about the Company’s leases from a lessor and lessee perspective, respectively. |
Accounting for Operating Leases as a Lessee | Accounting for Operating Leases as a Lessee — In its ordinary course of business, the Company enters into leases as a lessee for office buildings, warehouses, employee vehicles, and equipment. The Company determines if an arrangement is a lease or contains a lease at inception. Operating leases result in the recognition of ROU assets and lease liabilities on the Consolidated Statements of Financial Position. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease, measured on a discounted basis. At lease inception, the lease liability is measured at the present value of the lease payments over the lease term. The operating lease ROU asset equals the lease liability adjusted for any initial direct costs, prepaid or deferred rent, and lease incentives. The Company uses the implicit rate when readily determinable. As most of the leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date to determine the present value of lease payments. Incremental borrowing rates used to determine the present value of lease payments were derived by reference to the Company’s secured-debt yields corresponding to the lease commencement date. The lease term may include options to extend or to terminate the lease that the Company is reasonably certain to exercise. Lease expense is recognized on a straight-line basis over the lease term in most instances. The Company has elected not to record leases with an initial term of 12 months or less on the Consolidated Statements of Financial Position. Lease expense on such leases is recognized on a straight-line basis over the lease term. The Company does not generate material sublease income and has no material related party leases. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. |
Accounting for Operating Leases as a Lessor | Accounting for Leases as a Lessor — The Company’s wholly-owned subsidiary Dell Financial Services and its affiliates (“DFS”) acts as a lessor to provide equipment financing to customers through a variety of lease arrangements (“DFS leases”). Subsequent to the adoption of the new lease standard, new DFS leases are classified as sales-type leases, direct financing leases, or operating leases. Direct financing leases under the new lease standard are immaterial. Leases that commenced prior to the adoption of the new lease standard were not reassessed or restated pursuant to the practical expedients elected and will continue to be accounted for under previous lease accounting guidance. When a contract includes lease and non-lease components, DFS allocates consideration under the contract to each component based on relative standalone selling price. Whenever the terms of the lease transfer control to the lessee, the contract is typically classified as a sales-type lease. Through these arrangements, the lessee has the right to substantially all of the economic benefits from use of the identified asset and has the right to direct the use of such asset during the period of use. In many arrangements, the lessee also retains ownership at the end of the lease term. On commencement of sales-type leases, the Company recognizes profit up-front, and amounts due from the customer under the lease contract are recognized as financing receivables on the Consolidated Statements of Financial Position. Interest income is recognized as Net revenue over the term of the lease based on the effective interest method. For sales and other taxes collected from the lessee, the Company has elected not to include such taxes as part of lease revenue. All other leases which do not meet the definition of a sales-type lease or direct financing lease are classified as operating leases. The underlying asset in an operating lease arrangement is carried at depreciated cost as “Equipment under operating leases” within Property, plant, and equipment, net on the Consolidated Statements of Financial Position. Depreciation is calculated using the straight-line method over the term of the underlying lease contract and is recognized as Cost of net revenue. The depreciable basis is the original cost of the equipment less the estimated residual value of the equipment at the end of the lease term. The Company recognizes operating lease revenue on a straight-line basis over the lease term and expenses deferred initial direct costs on the same basis. Impairment of equipment under operating leases is assessed on the same basis as other long-lived assets. DFS provides lessees with the option to extend the lease or purchase the underlying asset at the end of the lease term, which is considered when evaluating lease classification. In general, DFS’s lease arrangements do not have variable payment terms and are non-cancelable. |
Financing Receivables | Financing Receivables — Financing receivables are presented net of allowance for losses and consist of customer receivables and residual interest. Customer receivables, gross includes amounts due from customers under revolving loans, fixed-term loans, fixed-term sales-type or direct financing leases, and accrued interest. The Company has two portfolios, consisting of: (1) fixed-term leases and loans and (2) revolving loans, and assesses risk at the portfolio level to determine the appropriate allowance levels. The portfolio segments are further segregated into classes based on products, customer type, and credit risk evaluation: (1) Revolving - Dell Preferred Account (“DPA”); (2) Revolving - Dell Business Credit (“DBC”); and (3) Fixed-term - Consumer and Commercial. Fixed-term leases and loans are offered to qualified small and medium-sized businesses, large commercial accounts, governmental organizations, and educational entities. Additionally, fixed-term loans are also offered to certain individual consumer customers. Revolving loans are offered under private label credit financing programs. The DPA revolving loan programs are offered to individual consumer customers and the DBC revolving loan programs are offered to small and medium-sized business customers. |
Asset Securitization | Asset Securitization — The Company transfers certain U.S. and European customer loan and lease payments and associated equipment to Special Purpose Entities (“SPEs”) that meet the definition of a Variable Interest Entity (“VIE”) and are consolidated into the Consolidated Financial Statements. These SPEs are bankruptcy-remote legal entities with separate assets and liabilities. The purpose of the SPEs is to facilitate the funding of customer lease and loan payments and associated equipment in the capital markets. These SPEs have entered into financing arrangements with multi-seller conduits that, in turn, issue asset-backed debt securities in the capital markets. The asset securitizations in the SPEs are accounted for as secured borrowings. See Note 4 of the Notes to the Condensed Consolidated Financial Statements for additional information on the impact of the consolidation. |
Money Market Funds | Money Market Funds — The Company’s investment in money market funds that are classified as cash equivalents hold underlying investments with a weighted average maturity of 90 days or less and are recognized at fair value. The valuations of these securities are based on quoted prices in active markets for identical assets, when available, or pricing models whereby all significant inputs are observable or can be derived from or corroborated by observable market data. The Company reviews security pricing and assesses liquidity on a quarterly basis. As of August 2, 2019 , the Company’s U.S. portfolio had no material exposure to money market funds with a fluctuating net asset value. |
Equity and Other Securities | Equity and Other Securities — The Company’s investments in equity and other securities that are measured at fair value on a recurring basis consist primarily of strategic investments in publicly-traded companies. The valuation of these securities is based on quoted prices in active markets. |
Derivative Instruments | Derivative Instruments — The Company’s derivative financial instruments consist primarily of foreign currency forward and purchased option contracts and interest rate swaps. The fair value of the portfolio is determined using valuation models based on market observable inputs, including interest rate curves, forward and spot prices for currencies, and implied volatilities. Credit risk is also factored into the fair value calculation of the Company’s derivative instrument portfolio. See Note 7 of the Notes to the Condensed Consolidated Financial Statements for a description of the Company’s derivative financial instrument activities. As part of its risk management strategy, the Company uses derivative instruments, primarily foreign currency forward and option contracts and interest rate swaps, to hedge certain foreign currency and interest rate exposures, respectively. The Company’s objective is to offset gains and losses resulting from these exposures with gains and losses on the derivative contracts used to hedge the exposures, thereby reducing volatility of earnings and protecting the fair values of assets and liabilities. The earnings effects of the derivative instruments are presented in the same income statement line items as the earnings effects of the hedged items. For derivatives designated as cash flow hedges, the Company assesses hedge effectiveness both at the onset of the hedge and at regular intervals throughout the life of the derivative. The Company does not have any derivatives designated as fair value hedges. |
Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis | Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis — Certain assets are measured at fair value on a nonrecurring basis and therefore are not included in the recurring fair value table above. These assets consist primarily of non-financial assets such as goodwill and intangible assets. See Note 8 of the Notes to the Condensed Consolidated Financial Statements for additional information about goodwill and intangible assets. As of August 2, 2019 and February 1, 2019 , the Company held private strategic investments of $760 million and $671 million , respectively. As these investments represent early-stage companies without readily determinable fair values, they are not included in the recurring fair value table above. The Company has elected to apply the measurement alternative for these investments. Under the alternative, the Company measures investments without readily determinable fair values at cost, less impairment, adjusted by observable price changes. The Company must make a separate election to use the alternative for each eligible investment and is required to reassess at each reporting period whether an investment qualifies for the alternative. In evaluating these investments for impairment or observable price changes, the Company uses inputs including pre- and post-money valuations of recent financing events and the impact of those on its fully diluted ownership percentages, as well as other available information regarding the issuer’s historical and forecasted performance. |
Commitments and Contingencies | The Company is involved in various claims, suits, assessments, investigations, and legal proceedings that arise from time to time in the ordinary course of its business, including those identified below, consisting of matters involving consumer, antitrust, tax, intellectual property, and other issues on a global basis. |
Deferred Compensation Plans | Deferred Compensation Plans —The Company offers deferred compensation plans for eligible employees, which allow participants to defer payment for a portion of their compensation. Assets were the same as liabilities associated with the plans at approximately $226 million and $192 million as of August 2, 2019 and February 1, 2019 , respectively, and are included in other assets and other liabilities on the Condensed Consolidated Statements of Financial Position . The net impact to the Condensed Consolidated Statements of Income (Loss) is not material since changes in the fair value of the assets substantially offset changes in the fair value of the liabilities. As such, assets and liabilities associated with these plans have not been included in the above table. These fair values were determined based on observable market prices in a less active market or based on valuation methodologies using observable inputs and were categorized as Level 2 in the fair value hierarchy. |
FAIR VALUE MEASUREMENTS AND I_2
FAIR VALUE MEASUREMENTS AND INVESTMENTS (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Fair Value Disclosures [Abstract] | |
Hierarchy for assets and liabilities measured at fair value on a recurring basis | The following table presents the Company’s hierarchy for its assets and liabilities measured at fair value on a recurring basis as of the dates indicated: August 2, 2019 February 1, 2019 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Quoted Significant Significant Quoted Significant Significant (in millions) Assets: Cash and cash equivalents: Money market funds $ 4,832 $ — $ — $ 4,832 $ 5,221 $ — $ — $ 5,221 Equity and other securities 8 — — 8 314 20 — 334 Derivative instruments — 251 — 251 — 97 — 97 Total assets $ 4,840 $ 251 $ — $ 5,091 $ 5,535 $ 117 $ — $ 5,652 Liabilities: Derivative instruments $ — $ 36 $ — $ 36 $ — $ 60 $ — $ 60 Total liabilities $ — $ 36 $ — $ 36 $ — $ 60 $ — $ 60 |
Carrying value and estimated fair value of outstanding debt | Carrying Value and Estimated Fair Value of Outstanding Debt — The following table presents the carrying value and estimated fair value of the Company’s outstanding debt as described in Note 6 of the Notes to the Condensed Consolidated Financial Statements , including the current portion, as of the dates indicated: August 2, 2019 February 1, 2019 Carrying Value Fair Value Carrying Value Fair Value (in billions) Senior Secured Credit Facilities $ 9.4 $ 9.5 $ 12.5 $ 12.6 First Lien Notes $ 20.5 $ 22.8 $ 19.8 $ 21.0 Unsecured Notes and Debentures $ 1.2 $ 1.4 $ 1.8 $ 1.9 Senior Notes $ 3.2 $ 3.4 $ 3.1 $ 3.4 EMC Notes $ 3.0 $ 3.0 $ 3.0 $ 2.9 VMware Notes $ 4.0 $ 4.0 $ 4.0 $ 3.9 Margin Loan Facility $ 4.0 $ 4.0 $ 3.3 $ 3.4 |
Investments | The following table presents the carrying value of the Company’s strategic investments in publicly-traded and privately-held companies as of the dates indicated: August 2, 2019 February 1, 2019 Cost Unrealized Gain Unrealized (Loss) Carrying Value Cost Unrealized Gain Unrealized (Loss) Carrying Value (in millions) Equity and other securities $ 715 $ 78 $ (25 ) $ 768 $ 638 $ 539 $ (172 ) $ 1,005 |
FINANCIAL SERVICES (Tables)
FINANCIAL SERVICES (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Receivables [Abstract] | |
Components of financing receivables segregated by portfolio segment | The following table presents the components of the Company’s financing receivables segregated by portfolio segment as of the dates indicated: August 2, 2019 February 1, 2019 Revolving Fixed-term Total Revolving Fixed-term Total (in millions) Financing receivables, net: Customer receivables, gross (a) $ 778 $ 7,544 $ 8,322 $ 835 $ 7,249 $ 8,084 Allowances for losses (67 ) (71 ) (138 ) (75 ) (61 ) (136 ) Customer receivables, net 711 7,473 8,184 760 7,188 7,948 Residual interest — 639 639 — 674 674 Financing receivables, net $ 711 $ 8,112 $ 8,823 $ 760 $ 7,862 $ 8,622 Short-term $ 711 $ 3,762 $ 4,473 $ 760 $ 3,638 $ 4,398 Long-term $ — $ 4,350 $ 4,350 $ — $ 4,224 $ 4,224 ____________________ (a) Customer receivables, gross includes amounts due from customers under revolving loans, fixed-term loans, fixed-term sales-type or direct financing leases, and accrued interest. |
Allowance for financing receivable losses | The following tables present the changes in allowance for financing receivable losses for the periods indicated: Three Months Ended August 2, 2019 August 3, 2018 Revolving Fixed-term Total Revolving Fixed-term Total (in millions) Allowance for financing receivable losses: Balances at beginning of period $ 70 $ 73 $ 143 $ 77 $ 62 $ 139 Charge-offs, net of recoveries (15 ) (9 ) (24 ) (19 ) (12 ) (31 ) Provision charged to income statement 12 7 19 17 1 18 Balances at end of period $ 67 $ 71 $ 138 $ 75 $ 51 $ 126 Six Months Ended August 2, 2019 August 3, 2018 Revolving Fixed-term Total Revolving Fixed-term Total (in millions) Allowance for financing receivable losses: Balances at beginning of period $ 75 $ 61 $ 136 $ 81 $ 64 $ 145 Charge-offs, net of recoveries (35 ) (12 ) (47 ) (39 ) (17 ) (56 ) Provision charged to income statement 27 22 49 33 4 37 Balances at end of period $ 67 $ 71 $ 138 $ 75 $ 51 $ 126 |
Aging of customer financing receivables | The following table presents the aging of the Company’s customer financing receivables, gross, including accrued interest, segregated by class, as of the dates indicated: August 2, 2019 February 1, 2019 Current Past Due — 90 Days Past Due Total Current Past Due — 90 Days Past Due Total (in millions) Revolving — DPA $ 537 $ 47 $ 18 $ 602 $ 583 $ 53 $ 21 $ 657 Revolving — DBC 153 19 4 176 155 19 4 178 Fixed-term — Consumer and Commercial 6,749 688 107 7,544 6,282 878 89 7,249 Total customer receivables, gross $ 7,439 $ 754 $ 129 $ 8,322 $ 7,020 $ 950 $ 114 $ 8,084 |
Credit quality indicators | The following table presents customer receivables, gross, including accrued interest, by credit quality indicator segregated by class, as of the dates indicated. The categories shown in the table below segregate customer receivables based on the relative degrees of credit risk. The credit quality indicators for DPA revolving accounts are measured primarily as of each quarter-end date, while all other indicators are generally updated on a periodic basis. August 2, 2019 February 1, 2019 Higher Mid Lower Total Higher Mid Lower Total (in millions) Revolving — DPA $ 121 $ 178 $ 303 $ 602 $ 128 $ 192 $ 337 $ 657 Revolving — DBC $ 45 $ 54 $ 77 $ 176 $ 47 $ 54 $ 77 $ 178 Fixed-term — Consumer and Commercial $ 4,377 $ 1,892 $ 1,275 $ 7,544 $ 3,980 $ 1,984 $ 1,285 $ 7,249 |
Finance leases | The following table presents the net revenue, cost of net revenue, and gross margin recognized at the commencement date of sales-type leases for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 2, 2019 (in millions) Net revenue — products $ 223 $ 353 Cost of net revenue — products 179 260 Gross margin — products $ 44 $ 93 |
Future maturity of fixed-term customer leases | The following table presents the future maturity of the Company’s fixed-term customer leases and associated financing payments, and reconciles the undiscounted cash flows to the customer receivables, gross recognized on the Condensed Consolidated Statements of Financial Position as of the date indicated: August 2, 2019 Fiscal Years (in millions) Fiscal 2020 (remaining six months) $ 1,488 Fiscal 2021 2,115 Fiscal 2022 1,322 Fiscal 2023 542 Fiscal 2024 and beyond 198 Total undiscounted cash flows 5,665 Fixed-term loans 2,373 Revolving loans 778 Less: unearned income (494 ) Total customer receivables, gross $ 8,322 |
Operating lease income | The following table presents the components of the Company’s operating lease portfolio included in Property, plant, and equipment, net as of the date indicated: August 2, 2019 (in millions) Equipment under operating lease, gross $ 455 Less: accumulated depreciation (29 ) Equipment under operating lease, net $ 426 |
Operating lease income maturities | The following table presents the future payments to be received by the Company as lessor in operating lease contracts as of the date indicated: August 2, 2019 Fiscal Years (in millions) Fiscal 2020 (remaining six months) $ 79 Fiscal 2021 140 Fiscal 2022 132 Fiscal 2023 55 Fiscal 2024 and beyond 3 Total $ 409 |
Summary of debt | The following table presents DFS debt as of the dates indicated. The table excludes the allocated portion of the Company’s other borrowings, which represents the additional amount considered to fund the DFS business. August 2, 2019 February 1, 2019 (in millions) DFS U.S. debt: Securitization facilities $ 2,287 $ 1,914 Fixed-term securitization offerings 2,438 2,303 Other 201 223 Total DFS U.S. debt 4,926 4,440 DFS international debt: Securitization facility 690 584 Other borrowings 831 708 Note payable 198 197 Total DFS international debt 1,719 1,489 Total DFS debt $ 6,645 $ 5,929 Total short-term DFS debt $ 3,703 $ 3,113 Total long-term DFS debt $ 2,942 $ 2,816 The following table presents the Company’s outstanding debt as of the dates indicated: August 2, 2019 February 1, 2019 (in millions) Secured Debt Senior Secured Credit Facilities: 4.24% Term Loan B Facility due September 2023 $ 4,913 $ 4,938 4.16% Term Loan A-2 Facility due September 2021 — 4,116 3.99% Term Loan A-4 Facility due December 2023 1,009 1,650 4.25% Term Loan A-5 Facility due December 2019 — 2,016 4.07% Term Loan A-6 Facility due March 2024 3,588 — First Lien Notes: 3.48% due June 2019 — 3,750 4.42% due June 2021 4,500 4,500 5.45% due June 2023 3,750 3,750 4.00% due July 2024 1,000 — 6.02% due June 2026 4,500 4,500 4.90% due October 2026 1,750 — 5.30% due October 2029 1,750 — 8.10% due July 2036 1,500 1,500 8.35% due July 2046 2,000 2,000 Unsecured Debt Unsecured Notes and Debentures: 5.875% due June 2019 — 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: 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 4) 6,645 5,929 Other 4.51% Margin Loan Facility due April 2022 4,000 3,350 Other 85 38 Total debt, principal amount $ 52,592 $ 54,239 August 2, 2019 February 1, 2019 (in millions) Total debt, principal amount $ 52,592 $ 54,239 Unamortized discount, net of unamortized premium (252 ) (271 ) Debt issuance costs (418 ) (447 ) Total debt, carrying value $ 51,922 $ 53,521 Total short-term debt, carrying value $ 5,949 $ 4,320 Total long-term debt, carrying value $ 45,973 $ 49,201 |
Financing receivables held by the consolidated VIEs | The following table presents financing receivables and equipment under operating leases, net held by the consolidated VIEs as of the dates indicated: August 2, 2019 February 1, 2019 (in millions) Assets held by consolidated VIEs, net: Short-term, net $ 3,072 $ 2,940 Long-term, net 3,011 2,508 Assets held by consolidated VIEs, net $ 6,083 $ 5,448 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Leases [Abstract] | |
Components of lease expense and supplemental information | The following table presents components of lease costs included in the Condensed Consolidated Statements of Income (Loss) for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 2, 2019 (in millions) Operating lease costs $ 126 $ 243 Variable costs 41 79 Total lease costs $ 167 $ 322 During the six months ended August 2, 2019 , sublease income, finance lease costs, and short-term lease costs were immaterial. The following table presents supplemental information related to operating leases included in the Condensed Consolidated Statements of Financial Position as of the date indicated: Classification August 2, 2019 (in millions, except for term and discount rate) Operating lease ROU assets Other non-current assets $ 1,630 Current operating lease liabilities Accrued and other current liabilities $ 412 Non-current operating lease liabilities Other non-current liabilities 1,234 Total operating lease liabilities $ 1,646 Weighted-average remaining lease term (in years) 8.82 Weighted-average discount rate 3.99 % The following table presents supplemental cash flow information related to leases for the period indicated: Six Months Ended August 2, 2019 (in millions) Cash paid for amounts included in the measurement of lease liabilities - $ 241 ROU assets obtained in exchange for new operating lease liabilities $ 254 |
Maturity of operating lease liabilities | The following table presents the future maturity of the Company’s operating lease liabilities under non-cancelable leases and reconciles the undiscounted cash flows for these leases to the lease liability recognized on the Condensed Consolidated Statements of Financial Position as of the date indicated: August 2, 2019 Fiscal Years (in millions) Fiscal 2020 (remaining six months) $ 224 Fiscal 2021 419 Fiscal 2022 321 Fiscal 2023 234 Fiscal 2024 153 Thereafter 696 Total lease payments $ 2,047 Less: Imputed interest (401 ) Total $ 1,646 Current operating lease liabilities $ 412 Non-current operating lease liabilities $ 1,234 |
Future minimum lease payments | Prior to the adoption of the new lease standard, the Company had the following future minimum lease payments under non-cancelable leases: February 1, 2019 Fiscal Years (in millions) Fiscal 2020 $ 371 Fiscal 2021 314 Fiscal 2022 240 Fiscal 2023 175 Fiscal 2024 113 Thereafter 643 Total $ 1,856 |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Debt Disclosure [Abstract] | |
Outstanding debt | The following table presents DFS debt as of the dates indicated. The table excludes the allocated portion of the Company’s other borrowings, which represents the additional amount considered to fund the DFS business. August 2, 2019 February 1, 2019 (in millions) DFS U.S. debt: Securitization facilities $ 2,287 $ 1,914 Fixed-term securitization offerings 2,438 2,303 Other 201 223 Total DFS U.S. debt 4,926 4,440 DFS international debt: Securitization facility 690 584 Other borrowings 831 708 Note payable 198 197 Total DFS international debt 1,719 1,489 Total DFS debt $ 6,645 $ 5,929 Total short-term DFS debt $ 3,703 $ 3,113 Total long-term DFS debt $ 2,942 $ 2,816 The following table presents the Company’s outstanding debt as of the dates indicated: August 2, 2019 February 1, 2019 (in millions) Secured Debt Senior Secured Credit Facilities: 4.24% Term Loan B Facility due September 2023 $ 4,913 $ 4,938 4.16% Term Loan A-2 Facility due September 2021 — 4,116 3.99% Term Loan A-4 Facility due December 2023 1,009 1,650 4.25% Term Loan A-5 Facility due December 2019 — 2,016 4.07% Term Loan A-6 Facility due March 2024 3,588 — First Lien Notes: 3.48% due June 2019 — 3,750 4.42% due June 2021 4,500 4,500 5.45% due June 2023 3,750 3,750 4.00% due July 2024 1,000 — 6.02% due June 2026 4,500 4,500 4.90% due October 2026 1,750 — 5.30% due October 2029 1,750 — 8.10% due July 2036 1,500 1,500 8.35% due July 2046 2,000 2,000 Unsecured Debt Unsecured Notes and Debentures: 5.875% due June 2019 — 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: 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 4) 6,645 5,929 Other 4.51% Margin Loan Facility due April 2022 4,000 3,350 Other 85 38 Total debt, principal amount $ 52,592 $ 54,239 August 2, 2019 February 1, 2019 (in millions) Total debt, principal amount $ 52,592 $ 54,239 Unamortized discount, net of unamortized premium (252 ) (271 ) Debt issuance costs (418 ) (447 ) Total debt, carrying value $ 51,922 $ 53,521 Total short-term debt, carrying value $ 5,949 $ 4,320 Total long-term debt, carrying value $ 45,973 $ 49,201 |
Aggregate future maturities | The following table presents the aggregate future maturities of the Company’s debt as of August 2, 2019 for the periods indicated: Maturities by Fiscal Year 2020 (remaining six months) 2021 2022 2023 2024 Thereafter Total (in millions) Senior Secured Credit Facilities and First Lien Notes $ 116 $ 174 $ 4,732 $ 290 $ 11,722 $ 13,226 $ 30,260 Unsecured Notes and Debentures — — 400 — — 952 1,352 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 2,140 3,051 980 438 36 — 6,645 Margin Loan Facility — — — 4,000 — — 4,000 Other 13 18 7 8 7 32 85 Total maturities, principal amount 2,269 6,493 7,744 6,236 12,765 17,085 52,592 Associated carrying value adjustments — (5 ) (78 ) (28 ) (142 ) (417 ) (670 ) Total maturities, carrying value amount $ 2,269 $ 6,488 $ 7,666 $ 6,208 $ 12,623 $ 16,668 $ 51,922 |
DERIVATIVE INSTRUMENTS AND HE_2
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Notional amounts of outstanding derivative instruments | August 2, 2019 February 1, 2019 (in millions) Foreign exchange contracts: Designated as cash flow hedging instruments $ 8,017 $ 7,573 Non-designated as hedging instruments 6,345 6,129 Total $ 14,362 $ 13,702 Interest rate contracts: Non-designated as hedging instruments $ 3,121 $ 2,674 |
Derivative instruments designated as hedging instruments | 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 (in millions) (in millions) For the three months ended August 2, 2019 Total net revenue $ 68 Foreign exchange contracts $ 105 Total cost of net revenue — Interest rate contracts — Interest and other, net — Total $ 105 $ 68 For the three months ended August 3, 2018 Total net revenue $ 77 Foreign exchange contracts $ 120 Total cost of net revenue — Interest rate contracts — Interest and other, net — Total $ 120 $ 77 For the six months ended August 2, 2019 Total net revenue $ 126 Foreign exchange contracts $ 257 Total cost of net revenue — Interest rate contracts — Interest and other, net — Total $ 257 $ 126 For the six months ended August 3, 2018 Total net revenue $ 46 Foreign exchange contracts $ 241 Total cost of net revenue — Interest rate contracts — Interest and other, net — Total $ 241 $ 46 |
Derivative instruments not designated as hedging instruments | Three Months Ended Six Months Ended August 2, 2019 August 3, 2018 August 2, 2019 August 3, 2018 Location of Gain (Loss) Recognized (in millions) Gain (Loss) Recognized: Foreign exchange contracts $ 7 $ 75 $ (59 ) $ 32 Interest and other, net Interest rate contracts (15 ) (1 ) (22 ) 1 Interest and other, net Total $ (8 ) $ 74 $ (81 ) $ 33 |
Fair value of derivatives | The following tables present the fair value of those derivative instruments presented on a gross basis as of the dates indicated: August 2, 2019 Other Current Other Non- Other Current Other Non-Current Total (in millions) Derivatives designated as hedging instruments: Foreign exchange contracts in an asset position $ 211 $ — $ 3 $ — $ 214 Foreign exchange contracts in a liability position (10 ) — (1 ) — (11 ) Net asset (liability) 201 — 2 — 203 Derivatives not designated as hedging instruments: Foreign exchange contracts in an asset position 278 1 8 — 287 Foreign exchange contracts in a liability position (238 ) — (23 ) (2 ) (263 ) Interest rate contracts in an asset position — 9 — — 9 Interest rate contracts in a liability position — — — (21 ) (21 ) Net asset (liability) 40 10 (15 ) (23 ) 12 Total derivatives at fair value $ 241 $ 10 $ (13 ) $ (23 ) $ 215 February 1, 2019 Other Current Other Non- Other Current Other Non-Current Total (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 |
Offsetting assets | The following tables present the gross amounts of the Company’s derivative instruments, amounts offset due to master netting agreements with the Company’s counterparties, and the net amounts recognized in the Condensed Consolidated Statements of Financial Position as of the dates indicated: August 2, 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 $ 510 $ (259 ) $ 251 $ — $ — $ 251 Financial liabilities (295 ) 259 (36 ) — 5 (31 ) Total derivative instruments $ 215 $ — $ 215 $ — $ 5 $ 220 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 |
Offsetting liabilities | The following tables present the gross amounts of the Company’s derivative instruments, amounts offset due to master netting agreements with the Company’s counterparties, and the net amounts recognized in the Condensed Consolidated Statements of Financial Position as of the dates indicated: August 2, 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 $ 510 $ (259 ) $ 251 $ — $ — $ 251 Financial liabilities (295 ) 259 (36 ) — 5 (31 ) Total derivative instruments $ 215 $ — $ 215 $ — $ 5 $ 220 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 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | The following table presents goodwill allocated to the Company’s business segments and changes in the carrying amount of goodwill as of the dates indicated: Infrastructure Solutions Group Client Solutions Group VMware Other Businesses (a) Total (in millions) Balance as of February 1, 2019 $ 15,199 $ 4,237 $ 16,419 $ 4,234 $ 40,089 Goodwill acquired (b) — — 272 — 272 Impact of foreign currency translation (123 ) — — (33 ) (156 ) Goodwill impaired (c) — — — (207 ) (207 ) Balance as of August 2, 2019 $ 15,076 $ 4,237 $ 16,691 $ 3,994 $ 39,998 ____________________ (a) Other Businesses consists of offerings by Pivotal, Secureworks, RSA Security LLC (“RSA Security”), Virtustream Group Holdings, Inc. (“Virtustream”), and Boomi, Inc. (“Boomi”). (b) VMware, Inc. acquisitions, as discussed below. (c) The Company recognized a goodwill impairment charge related to Virtustream, as discussed below. |
Schedule of definite-lived intangible assets | The following table presents the Company’s intangible assets as of the dates indicated: August 2, 2019 February 1, 2019 Gross Accumulated Net Gross Accumulated Net (in millions) Customer relationships $ 22,712 $ (12,828 ) $ 9,884 $ 22,750 $ (11,703 ) $ 11,047 Developed technology 15,450 (9,941 ) 5,509 15,701 (9,036 ) 6,665 Trade names 1,282 (711 ) 571 1,291 (606 ) 685 Leasehold assets (liabilities) — — — 128 (10 ) 118 Definite-lived intangible assets 39,444 (23,480 ) 15,964 39,870 (21,355 ) 18,515 Indefinite-lived trade names 3,755 — 3,755 3,755 — 3,755 Total intangible assets $ 43,199 $ (23,480 ) $ 19,719 $ 43,625 $ (21,355 ) $ 22,270 |
Schedule of indefinite-lived intangible assets | The following table presents the Company’s intangible assets as of the dates indicated: August 2, 2019 February 1, 2019 Gross Accumulated Net Gross Accumulated Net (in millions) Customer relationships $ 22,712 $ (12,828 ) $ 9,884 $ 22,750 $ (11,703 ) $ 11,047 Developed technology 15,450 (9,941 ) 5,509 15,701 (9,036 ) 6,665 Trade names 1,282 (711 ) 571 1,291 (606 ) 685 Leasehold assets (liabilities) — — — 128 (10 ) 118 Definite-lived intangible assets 39,444 (23,480 ) 15,964 39,870 (21,355 ) 18,515 Indefinite-lived trade names 3,755 — 3,755 3,755 — 3,755 Total intangible assets $ 43,199 $ (23,480 ) $ 19,719 $ 43,625 $ (21,355 ) $ 22,270 |
Estimated future annual pre-tax amortization expense | The following table presents the estimated future annual pre-tax amortization expense of definite-lived intangible assets as of the date indicated: August 2, 2019 Fiscal Years (in millions) 2020 (remaining six months) $ 2,095 2021 3,325 2022 2,619 2023 1,743 2024 1,386 Thereafter 4,796 Total $ 15,964 |
DEFERRED REVENUE (Tables)
DEFERRED REVENUE (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Changes in deferred revenue | The following table presents the changes in the Company’s deferred revenue for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 3, 2018 August 2, 2019 August 3, 2018 (in millions) Deferred revenue: Deferred revenue at beginning of period $ 24,178 $ 20,959 $ 24,010 $ 20,816 Revenue deferrals for new contracts and changes in estimates for pre-existing contracts (a) (b) 5,975 4,988 10,875 9,313 Revenue recognized (b) (4,805 ) (4,247 ) (9,537 ) (8,429 ) Deferred revenue at end of period $ 25,348 $ 21,700 $ 25,348 $ 21,700 Short-term deferred revenue $ 13,568 $ 11,965 $ 13,568 $ 11,965 Long-term deferred revenue $ 11,780 $ 9,735 $ 11,780 $ 9,735 ____________________ (a) Includes the impact of foreign currency exchange rate fluctuations. (b) The Company conformed the presentation of certain deferred revenue rollforward activity for the three and six months ended August 3, 2018 to align current year presentation. The beginning and ending deferred revenue liability balances remain unchanged. |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Equity [Abstract] | |
Changes in accumulated other comprehensive income (loss) | The following table presents changes in accumulated other comprehensive income (loss), net of tax, by the following components as of the dates indicated: Foreign Currency Translation Adjustments Investments Cash Flow Hedges Pension and Other Postretirement Plans Accumulated Other Comprehensive Income (Loss) (in millions) Balances as of February 1, 2019 $ (452 ) $ — $ (29 ) $ 14 $ (467 ) Other comprehensive income (loss) before reclassifications (236 ) — 257 8 29 Amounts reclassified from accumulated other comprehensive income (loss) — — (126 ) — (126 ) Total change for the period (236 ) — 131 8 (97 ) Less: Change in comprehensive income attributable to non-controlling interests — — 1 — 1 Balances as of August 2, 2019 $ (688 ) $ — $ 101 $ 22 $ (565 ) |
Reclassifications out of accumulated other comprehensive income (loss) | The following table presents reclassifications out of accumulated other comprehensive income (loss), net of tax, to net income (loss) for the periods indicated: Three Months Ended August 2, 2019 August 3, 2018 Investments Cash Flow Hedges Total Investments Cash Flow Hedges Total (in millions) Total reclassifications, net of tax: Net revenue $ — $ 68 $ 68 $ — $ 77 $ 77 Cost of net revenue — — — — — — Interest and other, net — — — — — — Total reclassifications, net of tax $ — $ 68 $ 68 $ — $ 77 $ 77 Six Months Ended August 2, 2019 August 3, 2018 Investments Cash Flow Hedges Total Investments Cash Flow Hedges Total (in millions) Total reclassifications, net of tax: Net revenue $ — $ 126 $ 126 $ — $ 46 $ 46 Cost of net revenue — — — — — — Interest and other, net — — — 1 — 1 Total reclassifications, net of tax $ — $ 126 $ 126 $ 1 $ 46 $ 47 |
NON-CONTROLLING INTERESTS (Tabl
NON-CONTROLLING INTERESTS (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Noncontrolling Interest [Abstract] | |
Effect of changes in ownership interest | The following table presents the effect of changes in the Company’s ownership interest in VMware, Inc., Pivotal, and Secureworks on the Company’s equity for the period indicated: Six Months Ended August 2, 2019 (in millions) Net income attributable to Dell Technologies Inc. $ 3,709 Transfers (to)/from the non-controlling interests: Increase in Dell Technologies Inc. additional paid-in-capital for equity issuances and other equity activity 379 Decrease in Dell Technologies Inc. additional paid-in-capital and accumulated deficit for equity issuances and other equity activity (1,036 ) Net transfers to non-controlling interests (657 ) Change from net income attributable to Dell Technologies Inc. and transfers to the non-controlling interests $ 3,052 |
CAPITALIZATION (Tables)
CAPITALIZATION (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Equity [Abstract] | |
Schedule of stock | The following table presents the Company’s authorized, issued, and outstanding common stock as of the dates indicated: Authorized Issued Outstanding (in millions) Common stock as of August 2, 2019 Class A 600 374 374 Class B 200 119 119 Class C 7,900 233 231 Class D 100 — — Class V 343 — — 9,143 726 724 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 |
EARNINGS (LOSS) PER SHARE (Tabl
EARNINGS (LOSS) PER SHARE (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Earnings Per Share [Abstract] | |
Computation of basic and diluted earnings (loss) per share and reconciliation to consolidated net income (loss) | The following table presents the basic and diluted earnings (loss) per share for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 3, 2018 August 2, 2019 August 3, 2018 Earnings (loss) per share attributable to Dell Technologies Inc. - basic: Dell Technologies Common Stock $ 4.75 $ 5.17 Class V Common Stock $ 1.61 $ 3.97 DHI Group $ (1.44 ) $ (3.39 ) Earnings (loss) per share attributable to Dell Technologies Inc. - diluted: Dell Technologies Common Stock $ 4.47 $ 4.84 Class V Common Stock $ 1.58 $ 3.91 DHI Group $ (1.45 ) $ (3.40 ) The following table presents the computation of basic and diluted earnings (loss) per share for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 2, 2019 (in millions) Numerator: Dell Technologies Common Stock Net income attributable to Dell Technologies - basic $ 3,416 $ 3,709 Incremental dilution from VMware, Inc. attributable to Dell Technologies (a) (62 ) (78 ) Net income attributable to Dell Technologies - diluted $ 3,354 $ 3,631 Denominator: Dell Technologies Common Stock weighted-average shares outstanding Weighted-average shares outstanding - basic 719 718 Dilutive effect of options, restricted stock units, restricted stock, and other 32 32 Weighted-average shares outstanding - diluted 751 750 Weighted-average shares outstanding - antidilutive 1 1 ____________________ (a) The incremental dilution from VMware, Inc. represents the impact of VMware, Inc.’s dilutive securities on diluted earnings (loss) per share of Dell Technologies Common Stock, 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. The following table presents the computation of basic and diluted earnings (loss) per share prior to Fiscal 2020 for the periods indicated: Three Months Ended Six Months Ended August 3, 2018 August 3, 2018 (in millions) Numerator: Class V Common Stock Net income attributable to Class V Common Stock - basic $ 320 $ 790 Incremental dilution from VMware, Inc. attributable to Class V Common Stock (a) (5 ) (12 ) Net income attributable to Class V Common Stock - diluted $ 315 $ 778 Numerator: DHI Group Net loss attributable to DHI Group - basic $ (819 ) $ (1,925 ) Incremental dilution from VMware, Inc. attributable to DHI Group (a) (4 ) (8 ) Net loss attributable to DHI Group - diluted $ (823 ) $ (1,933 ) Denominator: Class V Common Stock weighted-average shares outstanding Weighted-average shares outstanding - basic 199 199 Dilutive effect of options, restricted stock units, restricted stock, and other (b) — — Weighted-average shares outstanding - diluted 199 199 Weighted-average shares outstanding - antidilutive (b) — — Denominator: DHI Group weighted-average shares outstanding Weighted-average shares outstanding - basic 567 568 Dilutive effect of options, restricted stock units, restricted stock, and other — — Weighted-average shares outstanding - diluted 567 568 Weighted-average shares outstanding - antidilutive (c) 47 48 ____________________ (a) 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. (b) 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. (c) 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 as to the DHI Group for the periods presented. |
Reconciliation to the consolidated net income (loss) | The following table presents a reconciliation to the consolidated net loss attributable to Dell Technologies Inc. prior to Fiscal 2020 for the periods indicated: Three Months Ended Six Months Ended August 3, 2018 August 3, 2018 (in millions) Net income attributable to Class V Common Stock (a) $ 320 $ 790 Net loss attributable to DHI Group (819 ) (1,925 ) Net loss attributable to Dell Technologies Inc. $ (499 ) $ (1,135 ) ____________________ (a) See Exhibit 99.1 filed with the Company’s Quarterly Report on Form 10-Q for the quarterly period ended August 3, 2018 for a reconciliation of VMware net income to net income attributable to Class V Common Stock. |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Market based performance awards valuation assumptions | The following table presents the assumptions utilized in the valuation model for the period indicated: Six Months Ended August 2, 2019 Weighted-average grant date fair value $ 87.17 Expected term (in years) 3.0 Risk-free rate (U.S. Government Treasury Note) 2.4 % Expected volatility 45 % Expected dividend yield — % |
REDEEMABLE SHARES (Tables)
REDEEMABLE SHARES (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Temporary Equity Disclosure [Abstract] | |
Temporary equity | The following table presents the amount of redeemable shares classified as temporary equity and summarizes the award type as of the dates indicated: August 2, 2019 February 1, 2019 (in millions) Redeemable shares classified as temporary equity $ 1,024 $ 1,196 Issued and outstanding unrestricted common shares 2 3 Restricted stock units 1 1 Restricted stock awards — — Outstanding stock options 23 31 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Segment Reporting [Abstract] | |
Reconciliation of revenue from segments to consolidated | The following table presents a reconciliation of net revenue by the Company’s reportable segments to the Company’s consolidated net revenue as well as a reconciliation of consolidated segment operating income to the Company’s consolidated operating income (loss) for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 3, 2018 August 2, 2019 August 3, 2018 (in millions) Consolidated net revenue: Infrastructure Solutions Group $ 8,621 $ 9,227 $ 16,823 $ 17,894 Client Solutions Group 11,748 11,128 22,658 21,399 VMware 2,466 2,194 4,748 4,222 Reportable segment net revenue 22,835 22,549 44,229 43,515 Other businesses (a) 619 574 1,215 1,153 Unallocated transactions (b) — (1 ) — (3 ) Impact of purchase accounting (c) (84 ) (180 ) (166 ) (367 ) Total consolidated net revenue $ 23,370 $ 22,942 $ 45,278 $ 44,298 Consolidated operating income (loss): Infrastructure Solutions Group $ 1,050 $ 1,012 $ 1,893 $ 1,951 Client Solutions Group 982 425 1,775 958 VMware 762 736 1,376 1,349 Reportable segment operating income 2,794 2,173 5,044 4,258 Other businesses (a) (25 ) (49 ) (78 ) (99 ) Unallocated transactions (b) (26 ) (16 ) (27 ) (25 ) Impact of purchase accounting (c) (102 ) (215 ) (203 ) (437 ) Amortization of intangibles (1,060 ) (1,526 ) (2,277 ) (3,048 ) Transaction-related expenses (d) (47 ) (104 ) (89 ) (270 ) Stock-based compensation expense (e) (301 ) (216 ) (564 ) (415 ) Other corporate expenses (f) (714 ) (60 ) (737 ) (130 ) Total consolidated operating income (loss) $ 519 $ (13 ) $ 1,069 $ (166 ) ____________________ (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 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) Stock-based compensation expense consists of equity awards granted based on the estimated fair value of those awards at grant date. (f) Other corporate expenses includes impairment charges and severance, facility action, and other costs. See Note 8 of the Notes to the Condensed Consolidated Financial Statements for additional information on Virtustream impairment charges. |
Disaggregation of revenue | The following table presents the disaggregation of net revenue by reportable segment, and by major product categories within the segments for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 3, 2018 August 2, 2019 August 3, 2018 (in millions) Net revenue: Infrastructure Solutions Group: Servers and networking $ 4,437 $ 5,061 $ 8,617 $ 9,646 Storage 4,184 4,166 8,206 8,248 Total ISG net revenue 8,621 9,227 16,823 17,894 Client Solutions Group: Commercial 9,077 8,109 17,384 15,472 Consumer 2,671 3,019 5,274 5,927 Total CSG net revenue 11,748 11,128 22,658 21,399 VMware: Total VMware net revenue 2,466 2,194 4,748 4,222 Total segment net revenue $ 22,835 $ 22,549 $ 44,229 $ 43,515 |
SUPPLEMENTAL CONSOLIDATED FIN_2
SUPPLEMENTAL CONSOLIDATED FINANCIAL INFORMATION (Tables) | 6 Months Ended |
Aug. 02, 2019 | |
Condensed Financial Information Disclosure [Abstract] | |
Information on selected accounts | The following table presents additional information on selected accounts included in the Condensed Consolidated Statements of Financial Position as of the dates indicated: August 2, 2019 February 1, 2019 (in millions) Cash, cash equivalents, and restricted cash: Cash and cash equivalents $ 9,193 $ 9,676 Restricted cash - other current assets (a) 616 522 Restricted cash - other non-current assets (a) 126 42 Total cash, cash equivalents, and restricted cash $ 9,935 $ 10,240 Inventories, net: Production materials $ 1,441 $ 1,794 Work-in-process 623 702 Finished goods 1,071 1,153 Total inventories, net $ 3,135 $ 3,649 Other non-current liabilities: Warranty liability $ 170 $ 169 Deferred and other tax liabilities 4,605 5,527 Non-current operating lease liabilities 1,234 — Other 619 631 Total other non-current liabilities $ 6,628 $ 6,327 ____________________ (a) Restricted cash primarily includes cash required to be held in escrow pursuant to DFS securitization arrangements and VMware, Inc. restricted cash. |
Liability for standard limited warranties | The following table presents changes in the Company’s liability for standard limited warranties for the periods indicated: Three Months Ended Six Months Ended August 2, 2019 August 3, 2018 August 2, 2019 August 3, 2018 (in millions) Warranty liability: Warranty liability at beginning of period $ 500 $ 527 $ 524 $ 539 Costs accrued for new warranty contracts and changes in estimates for pre-existing warranties (a) (b) 237 236 440 430 Service obligations honored (212 ) (221 ) (439 ) (427 ) Warranty liability at end of period $ 525 $ 542 $ 525 $ 542 Current portion $ 355 $ 366 $ 355 $ 366 Non-current portion $ 170 $ 176 $ 170 $ 176 ____________________ (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. |
BASIS OF PRESENTATION - Narrati
BASIS OF PRESENTATION - Narrative (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 02, 2019 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease liability | $ 1,646 | |
Operating lease right of use asset | $ 1,630 | |
Accounting Standards Update 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease liability | $ 1,600 | |
Operating lease right of use asset | $ 1,600 |
FAIR VALUE MEASUREMENTS AND I_3
FAIR VALUE MEASUREMENTS AND INVESTMENTS - Hierarchy for Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Assets: | ||
Equity and other securities | $ 8 | $ 334 |
Derivative instruments | 251 | 97 |
Total assets | 5,091 | 5,652 |
Liabilities: | ||
Derivative instruments | 36 | 60 |
Total liabilities | 36 | 60 |
Money market funds | ||
Assets: | ||
Cash equivalents | 4,832 | 5,221 |
Level 1 | ||
Assets: | ||
Equity and other securities | 8 | 314 |
Derivative instruments | 0 | 0 |
Total assets | 4,840 | 5,535 |
Liabilities: | ||
Derivative instruments | 0 | 0 |
Total liabilities | 0 | 0 |
Level 1 | Money market funds | ||
Assets: | ||
Cash equivalents | 4,832 | 5,221 |
Level 2 | ||
Assets: | ||
Equity and other securities | 0 | 20 |
Derivative instruments | 251 | 97 |
Total assets | 251 | 117 |
Liabilities: | ||
Derivative instruments | 36 | 60 |
Total liabilities | 36 | 60 |
Level 2 | Money market funds | ||
Assets: | ||
Cash equivalents | 0 | 0 |
Level 3 | ||
Assets: | ||
Equity and other securities | 0 | 0 |
Derivative instruments | 0 | 0 |
Total assets | 0 | 0 |
Liabilities: | ||
Derivative instruments | 0 | 0 |
Total liabilities | 0 | 0 |
Level 3 | Money market funds | ||
Assets: | ||
Cash equivalents | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS AND I_4
FAIR VALUE MEASUREMENTS AND INVESTMENTS - Additional Information (Narrative) (Details) - USD ($) $ in Millions | 6 Months Ended | |
Aug. 02, 2019 | Feb. 01, 2019 | |
Fair Value Disclosures [Abstract] | ||
Carrying Value | $ 760 | $ 671 |
Deferred compensation plan assets | 226 | 192 |
Deferred compensation liability | 226 | $ 192 |
Equity securities, upward price adjustment | 78 | |
Equity securities, downward price adjustment | $ 8 |
FAIR VALUE MEASUREMENTS AND I_5
FAIR VALUE MEASUREMENTS AND INVESTMENTS - Carrying Value and Estimated Fair Value of Outstanding Debt (Details) - USD ($) $ in Billions | Aug. 02, 2019 | Feb. 01, 2019 |
Carrying Value | Senior Secured Credit Facilities | Secured Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | $ 9.4 | $ 12.5 |
Carrying Value | First Lien Notes | Secured Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | 20.5 | 19.8 |
Carrying Value | Unsecured Notes and Debentures | Unsecured Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | 1.2 | 1.8 |
Carrying Value | Senior Notes | Unsecured Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | 3.2 | 3.1 |
Carrying Value | EMC Notes | Unsecured Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | 3 | 3 |
Carrying Value | VMware Notes | Unsecured Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | 4 | 4 |
Carrying Value | Margin Loan Facility | Other | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | 4 | 3.3 |
Fair Value | Senior Secured Credit Facilities | Secured Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | 9.5 | 12.6 |
Fair Value | First Lien Notes | Secured Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | 22.8 | 21 |
Fair Value | Unsecured Notes and Debentures | Unsecured Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | 1.4 | 1.9 |
Fair Value | Senior Notes | Unsecured Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | 3.4 | 3.4 |
Fair Value | EMC Notes | Unsecured Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | 3 | 2.9 |
Fair Value | VMware Notes | Unsecured Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | 4 | 3.9 |
Fair Value | Margin Loan Facility | Other | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Outstanding debt | $ 4 | $ 3.4 |
FAIR VALUE MEASUREMENTS AND I_6
FAIR VALUE MEASUREMENTS AND INVESTMENTS - Investments (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Equity and other securities | ||
Carrying Value | $ 760 | $ 671 |
Long-Term Investments | ||
Equity and other securities | ||
Cost | 715 | 638 |
Unrealized Gain | 78 | 539 |
Unrealized (Loss) | (25) | (172) |
Carrying Value | $ 768 | $ 1,005 |
FINANCIAL SERVICES - Additional
FINANCIAL SERVICES - Additional Information (Narrative) (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | Sep. 09, 2019 | Mar. 20, 2019 | Feb. 01, 2019 | Jun. 01, 2016 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||
New financing originations | $ 2,000,000,000 | $ 1,900,000,000 | $ 3,700,000,000 | $ 3,600,000,000 | ||||
Interest income on the sales-type lease receivables | 66,000,000 | 130,000,000 | ||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Operating lease income | 27,000,000 | 31,000,000 | ||||||
Debt outstanding | 52,592,000,000 | 52,592,000,000 | $ 54,239,000,000 | |||||
Financing receivables sold | 246,000,000 | 271,000,000 | ||||||
Variable Interest Entity, Primary Beneficiary | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Financing receivables transferred via securitization through SPEs | 1,300,000,000 | $ 1,200,000,000 | 2,800,000,000 | $ 2,500,000,000 | ||||
Debt outstanding | 5,400,000,000 | 5,400,000,000 | 4,800,000,000 | |||||
Note payable | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Aggregate principal amount | 198,000,000 | $ 198,000,000 | ||||||
Note payable | LIBOR | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Basis spread on variable rate | 2.25% | |||||||
Note payable | Mexico, Pesos | TIIE | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Basis spread on variable rate | 2.00% | |||||||
Secured Debt | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Aggregate principal amount | $ 4,500,000,000 | $ 20,000,000,000 | ||||||
Secured Debt | Other | Canada | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Total debt capacity | 227,000,000 | $ 227,000,000 | ||||||
Secured Debt | Other | Europe | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Total debt capacity | 665,000,000 | 665,000,000 | ||||||
Secured Debt | Other | Australia and New Zealand | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Total debt capacity | 190,000,000 | 190,000,000 | ||||||
Assets Leased to Others | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Operating lease depreciation expense | $ 21,000,000 | $ 24,000,000 | ||||||
Minimum | Secured Debt | Fixed-term securitization offerings | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Interest rate | 2.14% | 2.14% | ||||||
Maximum | Secured Debt | Fixed-term securitization offerings | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Interest rate | 3.97% | 3.97% | ||||||
Revolving | ||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||
Repayment term (in years) | 12 months | |||||||
Fixed-term | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Fiscal 2020 | 2,600,000,000 | |||||||
Fiscal 2021 | 1,700,000,000 | |||||||
Fiscal 2022 | 900,000,000 | |||||||
Fiscal 2023 | 300,000,000 | |||||||
Fiscal 2024 and beyond | $ 100,000,000 | |||||||
Fixed-term | Secured Debt | Securitization facilities | International | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Total debt capacity | $ 887,000,000 | $ 887,000,000 | ||||||
Fixed-term | Minimum | Commercial Borrower | ||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||
Repayment term (in years) | 2 years | |||||||
Fixed-term | Minimum | Other Borrower | ||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||
Repayment term (in years) | 3 years | |||||||
Fixed-term | Maximum | Commercial Borrower | ||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||
Repayment term (in years) | 4 years | |||||||
Fixed-term | Maximum | Other Borrower | ||||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||||
Repayment term (in years) | 5 years | |||||||
Finance Leases and Revolving Loan Portfolio Segments | Secured Debt | Securitization facilities | U.S. | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Total debt capacity | $ 3,900,000,000 | $ 3,900,000,000 | ||||||
Subsequent Event | Finance Leases and Revolving Loan Portfolio Segments | Secured Debt | Securitization facilities | U.S. | ||||||||
Capital Leases, Future Minimum Payments Receivable, Fiscal Year Maturity [Abstract] | ||||||||
Increase in aggregate principal amount | $ 100,000,000 |
FINANCIAL SERVICES - Schedule o
FINANCIAL SERVICES - Schedule of Components of the Company's Financing Receivables Segregated by Portfolio Segment (Details) - USD ($) $ in Millions | Aug. 02, 2019 | May 03, 2019 | Feb. 01, 2019 | Aug. 03, 2018 | May 04, 2018 | Feb. 02, 2018 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Financing receivables, net | $ 8,823 | $ 8,622 | ||||
Short-term | 4,473 | 4,398 | ||||
Long-term | 4,350 | 4,224 | ||||
Customer receivables | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Customer receivables, gross | 8,322 | 8,084 | ||||
Allowances for losses | (138) | $ (143) | (136) | $ (126) | $ (139) | $ (145) |
Financing receivables, net | 8,184 | 7,948 | ||||
Residual interest | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Financing receivables, net | 639 | 674 | ||||
Revolving | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Financing receivables, net | 711 | 760 | ||||
Short-term | 711 | 760 | ||||
Long-term | 0 | 0 | ||||
Revolving | Customer receivables | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Customer receivables, gross | 778 | 835 | ||||
Allowances for losses | (67) | (70) | (75) | (75) | (77) | (81) |
Financing receivables, net | 711 | 760 | ||||
Revolving | Residual interest | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Financing receivables, net | 0 | 0 | ||||
Fixed-term | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Financing receivables, net | 8,112 | 7,862 | ||||
Short-term | 3,762 | 3,638 | ||||
Long-term | 4,350 | 4,224 | ||||
Fixed-term | Customer receivables | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Customer receivables, gross | 7,544 | 7,249 | ||||
Allowances for losses | (71) | $ (73) | (61) | $ (51) | $ (62) | $ (64) |
Financing receivables, net | 7,473 | 7,188 | ||||
Fixed-term | Residual interest | ||||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Financing receivables, net | $ 639 | $ 674 |
FINANCIAL SERVICES - Schedule_2
FINANCIAL SERVICES - Schedule of Changes in the Allowance for Financing Receivable Losses (Details) - Customer receivables - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balances at beginning of period | $ 143 | $ 139 | $ 136 | $ 145 |
Charge-offs, net of recoveries | (24) | (31) | (47) | (56) |
Provision charged to income statement | 19 | 18 | 49 | 37 |
Balances at end of period | 138 | 126 | 138 | 126 |
Revolving | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balances at beginning of period | 70 | 77 | 75 | 81 |
Charge-offs, net of recoveries | (15) | (19) | (35) | (39) |
Provision charged to income statement | 12 | 17 | 27 | 33 |
Balances at end of period | 67 | 75 | 67 | 75 |
Fixed-term | ||||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||||
Balances at beginning of period | 73 | 62 | 61 | 64 |
Charge-offs, net of recoveries | (9) | (12) | (12) | (17) |
Provision charged to income statement | 7 | 1 | 22 | 4 |
Balances at end of period | $ 71 | $ 51 | $ 71 | $ 51 |
FINANCIAL SERVICES - Aging Cust
FINANCIAL SERVICES - Aging Customer Financing Receivables, Gross, Including Accrued Interest (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Current | $ 7,439 | $ 7,020 |
Total customer receivables, gross | 8,322 | 8,084 |
Revolving | Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Total customer receivables, gross | 778 | 835 |
Revolving | Revolving — DPA | ||
Financing Receivable, Past Due [Line Items] | ||
Total customer receivables, gross | 602 | 657 |
Revolving | Revolving — DPA | Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Current | 537 | 583 |
Total customer receivables, gross | 602 | 657 |
Revolving | Revolving — DBC | ||
Financing Receivable, Past Due [Line Items] | ||
Total customer receivables, gross | 176 | 178 |
Revolving | Revolving — DBC | Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Current | 153 | 155 |
Total customer receivables, gross | 176 | 178 |
Fixed-term | Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Total customer receivables, gross | 7,544 | 7,249 |
Fixed-term | Fixed-term — Consumer and Commercial | ||
Financing Receivable, Past Due [Line Items] | ||
Total customer receivables, gross | 7,544 | 7,249 |
Fixed-term | Fixed-term — Consumer and Commercial | Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Current | 6,749 | 6,282 |
Total customer receivables, gross | 7,544 | 7,249 |
Past Due 1 — 90 Days | Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Past due | 754 | 950 |
Past Due 1 — 90 Days | Revolving | Revolving — DPA | Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Past due | 47 | 53 |
Past Due 1 — 90 Days | Revolving | Revolving — DBC | Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Past due | 19 | 19 |
Past Due 1 — 90 Days | Fixed-term | Fixed-term — Consumer and Commercial | Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Past due | 688 | 878 |
Past Due 90 Days | Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Past due | 129 | 114 |
Past Due 90 Days | Revolving | Revolving — DPA | Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Past due | 18 | 21 |
Past Due 90 Days | Revolving | Revolving — DBC | Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Past due | 4 | 4 |
Past Due 90 Days | Fixed-term | Fixed-term — Consumer and Commercial | Customer receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Past due | $ 107 | $ 89 |
FINANCIAL SERVICES - Credit Qua
FINANCIAL SERVICES - Credit Quality Indicators (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Revolving | Revolving — DPA | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Customer receivables, gross | $ 602 | $ 657 |
Revolving | Revolving — DBC | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Customer receivables, gross | 176 | 178 |
Fixed-term | Fixed-term — Consumer and Commercial | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Customer receivables, gross | 7,544 | 7,249 |
Higher | Revolving | Revolving — DPA | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Customer receivables, gross | 121 | 128 |
Higher | Revolving | Revolving — DBC | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Customer receivables, gross | 45 | 47 |
Higher | Fixed-term | Fixed-term — Consumer and Commercial | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Customer receivables, gross | 4,377 | 3,980 |
Mid | Revolving | Revolving — DPA | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Customer receivables, gross | 178 | 192 |
Mid | Revolving | Revolving — DBC | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Customer receivables, gross | 54 | 54 |
Mid | Fixed-term | Fixed-term — Consumer and Commercial | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Customer receivables, gross | 1,892 | 1,984 |
Lower | Revolving | Revolving — DPA | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Customer receivables, gross | 303 | 337 |
Lower | Revolving | Revolving — DBC | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Customer receivables, gross | 77 | 77 |
Lower | Fixed-term | Fixed-term — Consumer and Commercial | ||
Financing Receivable, Credit Quality Indicator [Line Items] | ||
Customer receivables, gross | $ 1,275 | $ 1,285 |
FINANCIAL SERVICES - Finance Le
FINANCIAL SERVICES - Finance Leases (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Aug. 02, 2019 | Aug. 02, 2019 | |
Receivables [Abstract] | ||
Net revenue — products | $ 223 | $ 353 |
Cost of net revenue — products | 179 | 260 |
Gross margin — products | $ 44 | $ 93 |
FINANCIAL SERVICES - Finance _2
FINANCIAL SERVICES - Finance Leases Future Maturity (Details) $ in Millions | Aug. 02, 2019USD ($) |
Sales-type and Direct Financing Leases, Lease Receivable, Fiscal Year Maturity [Abstract] | |
Fiscal 2020 (remaining six months) | $ 1,488 |
Fiscal 2021 | 2,115 |
Fiscal 2022 | 1,322 |
Fiscal 2023 | 542 |
Fiscal 2024 and beyond | 198 |
Total undiscounted cash flows | 5,665 |
Less: unearned income | (494) |
Total customer receivables, gross | 8,322 |
Fixed-term loans | |
Sales-type and Direct Financing Leases, Lease Receivable, Fiscal Year Maturity [Abstract] | |
Total customer receivables, gross | 2,373 |
Revolving loans | |
Sales-type and Direct Financing Leases, Lease Receivable, Fiscal Year Maturity [Abstract] | |
Total customer receivables, gross | $ 778 |
FINANCIAL SERVICES - Operating
FINANCIAL SERVICES - Operating Leases (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Equipment under operating lease, net | $ 5,568 | $ 5,259 |
Assets Leased to Others | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Equipment under operating lease, gross | 455 | |
Less: accumulated depreciation | (29) | |
Equipment under operating lease, net | $ 426 |
FINANCIAL SERVICES - Future Mat
FINANCIAL SERVICES - Future Maturities (Details) $ in Millions | Aug. 02, 2019USD ($) |
Operating Leases | |
Fiscal 2020 (remaining six months) | $ 79 |
Fiscal 2021 | 140 |
Fiscal 2022 | 132 |
Fiscal 2023 | 55 |
Fiscal 2024 and beyond | 3 |
Total | $ 409 |
FINANCIAL SERVICES - DFS Debt (
FINANCIAL SERVICES - DFS Debt (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
Total debt, carrying value | $ 51,922 | $ 53,521 |
Short-term debt | 5,949 | 4,320 |
Long-term debt | 45,973 | 49,201 |
Secured Debt | U.S. | Finance Leases and Revolving Loan Portfolio Segments | ||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
Total debt, carrying value | 4,926 | 4,440 |
Secured Debt | International | Finance Leases and Revolving Loan Portfolio Segments | ||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
Total debt, carrying value | 1,719 | 1,489 |
Securitization facilities | Secured Debt | U.S. | Finance Leases and Revolving Loan Portfolio Segments | ||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
Total debt, carrying value | 2,287 | 1,914 |
Securitization facilities | Secured Debt | International | Finance Leases and Revolving Loan Portfolio Segments | ||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
Total debt, carrying value | 690 | 584 |
Fixed-term securitization offerings | Secured Debt | U.S. | Finance Leases and Revolving Loan Portfolio Segments | ||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
Total debt, carrying value | 2,438 | 2,303 |
Other | Secured Debt | U.S. | Finance Leases and Revolving Loan Portfolio Segments | ||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
Total debt, carrying value | 201 | 223 |
Other | Secured Debt | International | Finance Leases and Revolving Loan Portfolio Segments | ||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
Total debt, carrying value | 831 | 708 |
Note payable | Secured Debt | International | Finance Leases and Revolving Loan Portfolio Segments | ||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
Total debt, carrying value | 198 | 197 |
DFS Debt | Secured Debt | ||
Qualitative and Quantitative Information, Transferor's Continuing Involvement [Line Items] | ||
Total debt, carrying value | 6,645 | 5,929 |
Short-term debt | 3,703 | 3,113 |
Long-term debt | $ 2,942 | $ 2,816 |
FINANCIAL SERVICES - Schedule_3
FINANCIAL SERVICES - Schedule of Financing Receivables Held by the Consolidated VIEs (Details) - Variable Interest Entity, Primary Beneficiary - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Assets held by consolidated VIEs, net | $ 6,083 | $ 5,448 |
Short-term, net | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Assets held by consolidated VIEs, net | 3,072 | 2,940 |
Long-term, net | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Assets held by consolidated VIEs, net | $ 3,011 | $ 2,508 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) $ in Millions | 6 Months Ended |
Aug. 02, 2019USD ($) | |
Lessee, Lease, Description [Line Items] | |
Operating lease not yet commenced | $ 393 |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Remaining lease term | 1 year |
Term of lease contract | 1 year |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Remaining lease term | 27 years |
Term of lease contract | 16 years |
LEASES - Components of Lease Ex
LEASES - Components of Lease Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Aug. 02, 2019 | Aug. 02, 2019 | |
Operating lease expense: | ||
Operating lease costs | $ 126 | $ 243 |
Variable costs | 41 | 79 |
Total lease costs | $ 167 | $ 322 |
LEASES - Supplemental Informati
LEASES - Supplemental Information Related to Operating Leases (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Leases [Abstract] | ||
Operating lease ROU assets | $ 1,630 | |
Current operating lease liabilities | 412 | |
Non-current operating lease liabilities | 1,234 | $ 0 |
Total operating lease liabilities | $ 1,646 | |
Weighted-average remaining lease term (in years) | 8 years 9 months 25 days | |
Weighted-average discount rate | 3.99% |
LEASES - Supplemental Cash Flow
LEASES - Supplemental Cash Flow Information (Details) $ in Millions | 6 Months Ended |
Aug. 02, 2019USD ($) | |
Leases [Abstract] | |
Cash paid for amounts included in the measurement of lease liabilities - operating cash outflows from operating leases | $ 241 |
ROU assets obtained in exchange for new operating lease liabilities | $ 254 |
LEASES - Maturity of Operating
LEASES - Maturity of Operating Leases (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | ||
Fiscal 2020 (remaining six months) | $ 224 | |
Fiscal 2021 | 419 | |
Fiscal 2022 | 321 | |
Fiscal 2023 | 234 | |
Fiscal 2024 | 153 | |
Thereafter | 696 | |
Total lease payments | 2,047 | |
Less: Imputed interest | (401) | |
Total operating lease liabilities | 1,646 | |
Current operating lease liabilities | 412 | |
Non-current operating lease liabilities | $ 1,234 | $ 0 |
LEASES - Future Minimum Lease P
LEASES - Future Minimum Lease Payments (Details) $ in Millions | Feb. 01, 2019USD ($) |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |
Fiscal 2020 | $ 371 |
Fiscal 2021 | 314 |
Fiscal 2022 | 240 |
Fiscal 2023 | 175 |
Fiscal 2024 | 113 |
Thereafter | 643 |
Total | $ 1,856 |
DEBT - Outstanding debt (Detail
DEBT - Outstanding debt (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Mar. 20, 2019 | Feb. 01, 2019 | Sep. 07, 2016 |
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 52,592 | $ 54,239 | ||
Unamortized discount, net of unamortized premium | (252) | (271) | ||
Debt issuance costs | (418) | (447) | ||
Total debt, carrying value | 51,922 | 53,521 | ||
Total short-term debt, carrying value | 5,949 | 4,320 | ||
Total long-term debt, carrying value | 45,973 | 49,201 | ||
DFS Debt | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | 6,645 | |||
4.51% Margin Loan Facility due April 2022 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | 4,000 | |||
Secured Debt | 4.24% Term Loan B Facility due September 2023 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 4,913 | 4,938 | ||
Interest rate at period end | 4.49% | |||
Secured Debt | 4.16% Term Loan A-2 Facility due September 2021 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 0 | 4,116 | ||
Interest rate at period end | 4.24% | |||
Secured Debt | 3.99% Term Loan A-4 Facility due December 2023 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 1,009 | 1,650 | ||
Interest rate at period end | 4.24% | |||
Secured Debt | 4.25% Term Loan A-5 Facility due December 2019 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 0 | 2,016 | ||
Interest rate at period end | 4.25% | |||
Secured Debt | 4.07% Term Loan A-6 Facility due March 2024 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 3,588 | 0 | ||
Interest rate at period end | 4.23% | |||
Secured Debt | 3.48% due June 2019 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 0 | 3,750 | ||
Interest rate | 3.48% | |||
Secured Debt | 4.42% due June 2021 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 4,500 | 4,500 | ||
Interest rate | 4.42% | |||
Secured Debt | 5.45% due June 2023 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 3,750 | 3,750 | ||
Interest rate | 5.45% | |||
Secured Debt | 4.00% due July 2024 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 1,000 | 0 | ||
Interest rate | 4.00% | 4.00% | ||
Secured Debt | 6.02% due June 2026 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 4,500 | 4,500 | ||
Interest rate | 4.90% | 4.90% | ||
Secured Debt | 4.90% due October 2026 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 1,750 | 0 | ||
Interest rate | 6.02% | |||
Secured Debt | 5.30% due October 2029 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 1,750 | 0 | ||
Interest rate | 5.30% | 5.30% | ||
Secured Debt | 8.10% due July 2036 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 1,500 | 1,500 | ||
Interest rate | 8.10% | |||
Secured Debt | 8.35% due July 2046 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 2,000 | 2,000 | ||
Interest rate | 8.35% | |||
Secured Debt | DFS Debt | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 6,645 | 5,929 | ||
Total debt, carrying value | 6,645 | 5,929 | ||
Total short-term debt, carrying value | 3,703 | 3,113 | ||
Total long-term debt, carrying value | 2,942 | 2,816 | ||
Unsecured Debt | 5.875% due June 2019 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 0 | 600 | ||
Interest rate | 5.875% | |||
Unsecured Debt | 4.625% due April 2021 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 400 | 400 | ||
Interest rate | 4.625% | |||
Unsecured Debt | 7.10% due April 2028 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 300 | 300 | ||
Interest rate | 7.10% | |||
Unsecured Debt | 6.50% due April 2038 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 388 | 388 | ||
Interest rate | 6.50% | |||
Unsecured Debt | 5.40% due September 2040 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 264 | 264 | ||
Interest rate | 5.40% | |||
Unsecured Debt | 5.875% due June 2021 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 1,625 | 1,625 | ||
Interest rate | 5.875% | |||
Unsecured Debt | 7.125% due June 2024 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 1,625 | 1,625 | ||
Interest rate | 7.125% | |||
Unsecured Debt | 2.650% due June 2020 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 2,000 | 2,000 | $ 2,000 | |
Interest rate | 2.65% | 2.65% | ||
Unsecured Debt | 3.375% due June 2023 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 1,000 | 1,000 | $ 1,000 | |
Interest rate | 3.375% | 3.375% | ||
Unsecured Debt | 2.30% due August 2020 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 1,250 | 1,250 | ||
Interest rate | 2.30% | |||
Unsecured Debt | 2.95% due August 2022 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 1,500 | 1,500 | ||
Interest rate | 2.95% | |||
Unsecured Debt | 3.90% due August 2027 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 1,250 | 1,250 | ||
Interest rate | 3.90% | |||
Other | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 85 | 38 | ||
Other | 4.51% Margin Loan Facility due April 2022 | ||||
Debt Instrument [Line Items] | ||||
Total debt, principal amount | $ 4,000 | $ 3,350 | ||
Interest rate at period end | 4.51% |
DEBT - Additional Information (
DEBT - Additional Information (Details) shares in Millions | May 03, 2019USD ($) | Mar. 20, 2019USD ($) | Mar. 13, 2019USD ($) | Dec. 28, 2018USD ($) | Sep. 12, 2017USD ($)option_period | Apr. 12, 2017USD ($)shares | Jun. 01, 2016USD ($) | May 03, 2019USD ($) | Aug. 02, 2019USD ($) | Aug. 03, 2018USD ($) | Mar. 14, 2019USD ($) | Mar. 07, 2019USD ($) | Feb. 01, 2019USD ($) | Dec. 20, 2018USD ($) | Sep. 07, 2017USD ($) | Aug. 21, 2017USD ($) | Sep. 07, 2016USD ($) | Jun. 22, 2016USD ($) |
Debt Instrument [Line Items] | ||||||||||||||||||
Repayments of debt | $ 13,911,000,000 | $ 6,948,000,000 | ||||||||||||||||
Proceeds from credit facility | 12,201,000,000 | $ 4,637,000,000 | ||||||||||||||||
Total debt, principal amount | 52,592,000,000 | $ 54,239,000,000 | ||||||||||||||||
Third-party costs | $ 74,500,000 | $ 74,500,000 | ||||||||||||||||
Unamortized costs | 32,300,000 | |||||||||||||||||
DFS Debt | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Total debt, principal amount | 6,645,000,000 | |||||||||||||||||
4.51% Margin Loan Facility due April 2022 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Total debt, principal amount | 4,000,000,000 | |||||||||||||||||
VMware, Inc. | Revolving Credit Facility | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 1,000,000,000 | 4,500,000,000 | ||||||||||||||||
Debt instrument, term | 5 years | |||||||||||||||||
Number of extension periods | option_period | 2 | |||||||||||||||||
Conditional extension period | 1 year | |||||||||||||||||
Outstanding borrowings under credit facility | 0 | |||||||||||||||||
China Revolving Credit Facility | Revolving Credit Facility | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 500,000,000 | 500,000,000 | ||||||||||||||||
Total debt, principal amount | 0 | |||||||||||||||||
China Revolving Credit Facility | LIBOR | Revolving Credit Facility | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Basis spread on variable rate | 0.60% | |||||||||||||||||
Pivotal Revolving Credit Facility | Revolving Credit Facility | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 100,000,000 | |||||||||||||||||
Outstanding borrowings under credit facility | 0 | |||||||||||||||||
Line of Credit | 4.16% Term Loan A-2 Facility due September 2021 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Repayments of debt | 550,000,000 | $ 1,277,000,000 | ||||||||||||||||
Total debt, principal amount | $ 2,839,000,000 | $ 1,277,000,000 | ||||||||||||||||
Line of Credit | 4.07% Term Loan A-6 Facility due March 2024 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | 3,634,000,000 | |||||||||||||||||
Proceeds from issuance of debt | $ 800,000,000 | |||||||||||||||||
Line of Credit | 4.24% Term Loan B Facility due September 2023 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Annual principal amortization | 1.00% | |||||||||||||||||
Line of Credit | 4.24% Term Loan B Facility due September 2023 | Base Rate | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate floor | 1.75% | |||||||||||||||||
Line of Credit | 4.24% Term Loan B Facility due September 2023 | LIBOR | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate floor | 0.75% | |||||||||||||||||
Line of Credit | 3.33% Revolving Credit Facility due September 2021 | Base Rate | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate floor | 0.00% | |||||||||||||||||
Line of Credit | 3.33% Revolving Credit Facility due September 2021 | LIBOR | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate floor | 0.00% | |||||||||||||||||
Secured Debt | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Aggregate principal amount | $ 4,500,000,000 | $ 20,000,000,000 | ||||||||||||||||
Debt, maximum period for registration | 5 years | |||||||||||||||||
Secured Debt | 4.16% Term Loan A-2 Facility due September 2021 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Total debt, principal amount | $ 0 | 4,116,000,000 | ||||||||||||||||
Secured Debt | 3.99% Term Loan A-4 Facility due December 2023 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Repayments of debt | 620,000,000 | |||||||||||||||||
Total debt, principal amount | 1,009,000,000 | 1,650,000,000 | ||||||||||||||||
Secured Debt | 5.875% due June 2019 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Repayments of debt | 600,000,000 | |||||||||||||||||
Secured Debt | Term Loan Facilities | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Repayments of debt, amortization cost included | 91,000,000 | |||||||||||||||||
Secured Debt | DFS Debt | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Proceeds from credit facility | 700,000,000 | |||||||||||||||||
Total debt, principal amount | 6,645,000,000 | 5,929,000,000 | ||||||||||||||||
Secured Debt | 4.07% Term Loan A-6 Facility due March 2024 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Total debt, principal amount | $ 3,588,000,000 | 0 | ||||||||||||||||
Secured Debt | 4.00% due July 2024 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 4.00% | 4.00% | ||||||||||||||||
Total debt, principal amount | $ 1,000,000,000 | 0 | ||||||||||||||||
Aggregate principal amount | $ 1,000,000,000 | |||||||||||||||||
Secured Debt | 6.02% due June 2026 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 4.90% | 4.90% | ||||||||||||||||
Total debt, principal amount | $ 4,500,000,000 | 4,500,000,000 | ||||||||||||||||
Aggregate principal amount | $ 1,750,000,000 | |||||||||||||||||
Secured Debt | 5.30% due October 2029 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 5.30% | 5.30% | ||||||||||||||||
Total debt, principal amount | $ 1,750,000,000 | 0 | ||||||||||||||||
Aggregate principal amount | $ 1,750,000,000 | |||||||||||||||||
Secured Debt | 3.48% due June 2019 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Repayments of debt | $ 3,750,000,000 | |||||||||||||||||
Secured Debt | 4.24% Term Loan B Facility due September 2023 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Total debt, principal amount | $ 4,913,000,000 | 4,938,000,000 | ||||||||||||||||
Secured Debt | 3.33% Revolving Credit Facility due September 2021 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Debt instrument, collateral, percent of capital stock of borrowers | 100.00% | |||||||||||||||||
Unsecured Notes and Debentures | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Aggregate principal amount | $ 3,250,000,000 | |||||||||||||||||
Unsecured Notes and Debentures | 5.875% due June 2019 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 5.875% | |||||||||||||||||
Total debt, principal amount | $ 0 | 600,000,000 | ||||||||||||||||
Unsecured Notes and Debentures | 1.875% due June 2018 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 1.875% | |||||||||||||||||
Total debt, principal amount | $ 2,500,000,000 | |||||||||||||||||
Unsecured Notes and Debentures | 2.650% due June 2020 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 2.65% | 2.65% | ||||||||||||||||
Total debt, principal amount | $ 2,000,000,000 | 2,000,000,000 | $ 2,000,000,000 | |||||||||||||||
Unsecured Notes and Debentures | 3.375% due June 2023 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 3.375% | 3.375% | ||||||||||||||||
Total debt, principal amount | $ 1,000,000,000 | 1,000,000,000 | $ 1,000,000,000 | |||||||||||||||
Unsecured Notes and Debentures | 2.30% due August 2020 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 2.30% | |||||||||||||||||
Total debt, principal amount | $ 1,250,000,000 | 1,250,000,000 | ||||||||||||||||
Unsecured Notes and Debentures | 2.95% due August 2022 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 2.95% | |||||||||||||||||
Total debt, principal amount | $ 1,500,000,000 | 1,500,000,000 | ||||||||||||||||
Unsecured Notes and Debentures | 3.90% due August 2027 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 3.90% | |||||||||||||||||
Total debt, principal amount | $ 1,250,000,000 | $ 1,250,000,000 | ||||||||||||||||
Other | 4.51% Margin Loan Facility due April 2022 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Increase in aggregate principal amount | $ 650,000,000 | |||||||||||||||||
Maximum borrowing capacity | $ 4,000,000,000 | $ 2,000,000,000 | $ 3,350,000,000 | |||||||||||||||
Other | 4.51% Margin Loan Facility due April 2022 | Class B | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Debt instrument, collateral (in shares) | shares | 60 | |||||||||||||||||
Other | 4.51% Margin Loan Facility due April 2022 | Class A | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Debt instrument, collateral (in shares) | shares | 20 | |||||||||||||||||
Other | 4.51% Margin Loan Facility due April 2022 | Base Rate | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Basis spread on variable rate | 1.25% | |||||||||||||||||
Other | 4.51% Margin Loan Facility due April 2022 | LIBOR | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Basis spread on variable rate | 2.25% | |||||||||||||||||
Other | Senior Secured Credit Facilities | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | 400,000,000 | |||||||||||||||||
Letter of Credit | Senior Secured Credit Facilities | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Maximum borrowing capacity | $ 500,000,000 | |||||||||||||||||
Senior Notes | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Aggregate principal amount | $ 4,000,000,000 | |||||||||||||||||
Senior Notes | 2.30% due August 2020 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 2.30% | |||||||||||||||||
Aggregate principal amount | $ 1,250,000,000 | |||||||||||||||||
Senior Notes | 2.95% due August 2022 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 2.95% | |||||||||||||||||
Aggregate principal amount | $ 1,500,000,000 | |||||||||||||||||
Senior Notes | 3.90% due August 2027 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Interest rate | 3.90% | |||||||||||||||||
Aggregate principal amount | $ 1,250,000,000 | |||||||||||||||||
First Four Years After December 20, 2018 | Line of Credit | 3.99% Term Loan A-4 Facility due December 2023 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Annual principal amortization | 5.00% | |||||||||||||||||
Fifth Year After December 20, 2018 | Line of Credit | 3.99% Term Loan A-4 Facility due December 2023 | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Annual principal amortization | 80.00% | |||||||||||||||||
First Four Years After March 13, 2019 | Line of Credit | Term Loan A-6 Facility | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Annual principal amortization | 5.00% | |||||||||||||||||
Fifth Year After March 13, 2019 | Line of Credit | Term Loan A-6 Facility | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Annual principal amortization | 80.00% | |||||||||||||||||
Minimum | Secured Debt | 4.07% Term Loan A-6 Facility due March 2024 | Base Rate | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Basis spread on variable rate | 0.25% | |||||||||||||||||
Minimum | Secured Debt | 4.07% Term Loan A-6 Facility due March 2024 | LIBOR | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Basis spread on variable rate | 1.25% | |||||||||||||||||
Maximum | Secured Debt | 4.07% Term Loan A-6 Facility due March 2024 | Base Rate | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Basis spread on variable rate | 1.00% | |||||||||||||||||
Maximum | Secured Debt | 4.07% Term Loan A-6 Facility due March 2024 | LIBOR | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Basis spread on variable rate | 2.00% | |||||||||||||||||
Merger Agreement | Line of Credit | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Repayments of debt | $ 5,000,000,000 | |||||||||||||||||
Merger Agreement | Other | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Proceeds from issuance of debt | $ 1,350,000,000 | |||||||||||||||||
Third Party | ||||||||||||||||||
Debt Instrument [Line Items] | ||||||||||||||||||
Unamortized costs | $ 7,100,000 |
DEBT - Aggregate future maturit
DEBT - Aggregate future maturities (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Total maturities, principal amount | ||
2020 (remaining six months) | $ 2,269 | |
2021 | 6,493 | |
2022 | 7,744 | |
2023 | 6,236 | |
2024 | 12,765 | |
Thereafter | 17,085 | |
Total debt, principal amount | 52,592 | $ 54,239 |
Associated carrying value adjustments | ||
2020 (remaining six months) | 0 | |
2021 | (5) | |
2022 | (78) | |
2023 | (28) | |
2024 | (142) | |
Thereafter | (417) | |
Total | (670) | |
Total maturities, carrying value amount | ||
2020 (remaining six months) | 2,269 | |
2021 | 6,488 | |
2022 | 7,666 | |
2023 | 6,208 | |
2024 | 12,623 | |
Thereafter | 16,668 | |
Total debt, carrying value | 51,922 | $ 53,521 |
Senior Secured Credit Facilities and First Lien Notes | ||
Total maturities, principal amount | ||
2020 (remaining six months) | 116 | |
2021 | 174 | |
2022 | 4,732 | |
2023 | 290 | |
2024 | 11,722 | |
Thereafter | 13,226 | |
Total debt, principal amount | 30,260 | |
Unsecured Notes and Debentures | ||
Total maturities, principal amount | ||
2020 (remaining six months) | 0 | |
2021 | 0 | |
2022 | 400 | |
2023 | 0 | |
2024 | 0 | |
Thereafter | 952 | |
Total debt, principal amount | 1,352 | |
Senior Notes and EMC Notes | ||
Total maturities, principal amount | ||
2020 (remaining six months) | 0 | |
2021 | 2,000 | |
2022 | 1,625 | |
2023 | 0 | |
2024 | 1,000 | |
Thereafter | 1,625 | |
Total debt, principal amount | 6,250 | |
VMware Notes | ||
Total maturities, principal amount | ||
2020 (remaining six months) | 0 | |
2021 | 1,250 | |
2022 | 0 | |
2023 | 1,500 | |
2024 | 0 | |
Thereafter | 1,250 | |
Total debt, principal amount | 4,000 | |
DFS Debt | ||
Total maturities, principal amount | ||
2020 (remaining six months) | 2,140 | |
2021 | 3,051 | |
2022 | 980 | |
2023 | 438 | |
2024 | 36 | |
Thereafter | 0 | |
Total debt, principal amount | 6,645 | |
Margin Loan Facility | ||
Total maturities, principal amount | ||
2020 (remaining six months) | 0 | |
2021 | 0 | |
2022 | 0 | |
2023 | 4,000 | |
2024 | 0 | |
Thereafter | 0 | |
Total debt, principal amount | 4,000 | |
Other | ||
Total maturities, principal amount | ||
2020 (remaining six months) | 13 | |
2021 | 18 | |
2022 | 7 | |
2023 | 8 | |
2024 | 7 | |
Thereafter | 32 | |
Total debt, principal amount | $ 85 |
DERIVATIVE INSTRUMENTS AND HE_3
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Additional Information (Narrative) (Details) | 6 Months Ended |
Aug. 02, 2019 | |
Designated as cash flow hedging instruments | Foreign Exchange Forward and Option | |
Derivative [Line Items] | |
Term of derivative contract | 12 months |
Not Designated as Hedging Instrument | Foreign Exchange Forward | |
Derivative [Line Items] | |
Term of derivative contract | 3 months |
Not Designated as Hedging Instrument | Foreign Exchange Forward | Financing receivables | |
Derivative [Line Items] | |
Term of derivative contract | 3 years |
Not Designated as Hedging Instrument | Interest Rate Swap | |
Derivative [Line Items] | |
Term of derivative contract | 5 years |
Not Designated as Hedging Instrument | Interest Rate Swap | Structured financing debt | |
Derivative [Line Items] | |
Term of derivative contract | 3 years |
Not Designated as Hedging Instrument | Cross Currency Interest Rate Contract | |
Derivative [Line Items] | |
Term of derivative contract | 5 years |
DERIVATIVE INSTRUMENTS AND HE_4
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Notional Amounts of Outstanding Derivative Instruments (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Foreign exchange contracts | ||
Derivative [Line Items] | ||
Notional amount | $ 14,362 | $ 13,702 |
Foreign exchange contracts | Designated as cash flow hedging instruments | ||
Derivative [Line Items] | ||
Notional amount | 8,017 | 7,573 |
Foreign exchange contracts | Non-designated as hedging instruments | ||
Derivative [Line Items] | ||
Notional amount | 6,345 | 6,129 |
Interest rate contracts | Non-designated as hedging instruments | ||
Derivative [Line Items] | ||
Notional amount | $ 3,121 | $ 2,674 |
DERIVATIVE INSTRUMENTS AND HE_5
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Effect of Derivative Instruments on the Condensed Consolidated Statements of Financial Position and the Condensed Consolidated Statements of Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | |
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Recognized in Accumulated OCI, Net of Tax, on Derivatives | $ 105 | $ 120 | $ 257 | $ 241 |
Gain (Loss) Reclassified from Accumulated OCI into Income | 68 | 77 | 126 | 46 |
Gain (Loss) Recognized in Income | (8) | 74 | (81) | 33 |
Foreign exchange contracts | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Recognized in Accumulated OCI, Net of Tax, on Derivatives | 105 | 120 | 257 | 241 |
Foreign exchange contracts | Total net revenue | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Reclassified from Accumulated OCI into Income | 68 | 77 | 126 | 46 |
Foreign exchange contracts | Total cost of net revenue | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Reclassified from Accumulated OCI into Income | 0 | 0 | 0 | 0 |
Foreign exchange contracts | Interest and other, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Recognized in Income | 7 | 75 | (59) | 32 |
Interest rate contracts | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Recognized in Accumulated OCI, Net of Tax, on Derivatives | 0 | 0 | 0 | 0 |
Interest rate contracts | Interest and other, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (Loss) Reclassified from Accumulated OCI into Income | 0 | 0 | 0 | 0 |
Gain (Loss) Recognized in Income | $ (15) | $ (1) | $ (22) | $ 1 |
DERIVATIVE INSTRUMENTS AND HE_6
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Fair Value of Derivative Instruments in the Condensed Consolidated Statements of Financial Position (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Derivatives, Fair Value [Line Items] | ||
Asset position | $ 510 | $ 312 |
Liability position | (295) | (275) |
Gross Amounts of Recognized Assets/ (Liabilities) | 215 | 37 |
Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | 241 | 94 |
Other Non- Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | 10 | 3 |
Other Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | (13) | (49) |
Other Non-Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | (23) | (11) |
Designated as cash flow hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | 203 | 35 |
Designated as cash flow hedging instruments | Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | 201 | 26 |
Designated as cash flow hedging instruments | Other Non- Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | 0 | 0 |
Designated as cash flow hedging instruments | Other Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | 2 | 9 |
Designated as cash flow hedging instruments | Other Non-Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | 0 | 0 |
Designated as cash flow hedging instruments | Foreign exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 214 | 74 |
Liability position | (11) | (39) |
Designated as cash flow hedging instruments | Foreign exchange contracts | Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 211 | 45 |
Liability position | (10) | (19) |
Designated as cash flow hedging instruments | Foreign exchange contracts | Other Non- Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 0 | 0 |
Liability position | 0 | 0 |
Designated as cash flow hedging instruments | Foreign exchange contracts | Other Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 3 | 29 |
Liability position | (1) | (20) |
Designated as cash flow hedging instruments | Foreign exchange contracts | Other Non-Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 0 | 0 |
Liability position | 0 | 0 |
Non-designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | 12 | 2 |
Non-designated as hedging instruments | Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | 40 | 68 |
Non-designated as hedging instruments | Other Non- Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | 10 | 3 |
Non-designated as hedging instruments | Other Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | (15) | (58) |
Non-designated as hedging instruments | Other Non-Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Gross Amounts of Recognized Assets/ (Liabilities) | (23) | (11) |
Non-designated as hedging instruments | Foreign exchange contracts | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 287 | 235 |
Liability position | (263) | (227) |
Non-designated as hedging instruments | Foreign exchange contracts | Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 278 | 178 |
Liability position | (238) | (110) |
Non-designated as hedging instruments | Foreign exchange contracts | Other Non- Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 1 | 0 |
Liability position | 0 | 0 |
Non-designated as hedging instruments | Foreign exchange contracts | Other Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 8 | 57 |
Liability position | (23) | (115) |
Non-designated as hedging instruments | Foreign exchange contracts | Other Non-Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 0 | 0 |
Liability position | (2) | (2) |
Non-designated as hedging instruments | Interest rate contracts | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 9 | 3 |
Liability position | (21) | (9) |
Non-designated as hedging instruments | Interest rate contracts | Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 0 | 0 |
Liability position | 0 | 0 |
Non-designated as hedging instruments | Interest rate contracts | Other Non- Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 9 | 3 |
Liability position | 0 | 0 |
Non-designated as hedging instruments | Interest rate contracts | Other Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 0 | 0 |
Liability position | 0 | 0 |
Non-designated as hedging instruments | Interest rate contracts | Other Non-Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Asset position | 0 | 0 |
Liability position | $ (21) | $ (9) |
DERIVATIVE INSTRUMENTS AND HE_7
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Gross amounts of derivative instruments, amounts offset due to master netting agreements (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Financial assets | ||
Gross Amounts of Recognized Assets/ (Liabilities) | $ 510 | $ 312 |
Gross Amounts Offset in the Statement of Financial Position | (259) | (215) |
Net Amounts of Assets/ (Liabilities) Presented in the Statement of Financial Position | 251 | 97 |
Financial Instruments | 0 | 0 |
Cash Collateral Received or Pledged | 0 | 0 |
Net Amount | 251 | 97 |
Financial liabilities | ||
Gross Amounts of Recognized Assets/ (Liabilities) | (295) | (275) |
Gross Amounts Offset in the Statement of Financial Position | 259 | 215 |
Net Amounts of Assets/ (Liabilities) Presented in the Statement of Financial Position | (36) | (60) |
Financial Instruments | 0 | 0 |
Cash Collateral Received or Pledged | 5 | 4 |
Net Amount | (31) | (56) |
Total derivative instruments | ||
Gross Amounts of Recognized Assets/ (Liabilities) | 215 | 37 |
Gross Amounts Offset in the Statement of Financial Position | 0 | 0 |
Net Amounts of Assets/ (Liabilities) Presented in the Statement of Financial Position | 215 | 37 |
Financial Instruments | 0 | 0 |
Cash Collateral Received or Pledged | 5 | 4 |
Net Amount | $ 220 | $ 41 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - Goodwill (Details) - USD ($) | 6 Months Ended | |
Aug. 02, 2019 | Aug. 03, 2018 | |
Goodwill [Roll Forward] | ||
Goodwill | $ 40,089,000,000 | |
Goodwill acquired | 272,000,000 | |
Impact of foreign currency translation | (156,000,000) | |
Goodwill impaired | (207,000,000) | $ 0 |
Goodwill | 39,998,000,000 | |
Infrastructure Solutions Group | ||
Goodwill [Roll Forward] | ||
Goodwill | 15,199,000,000 | |
Goodwill acquired | 0 | |
Impact of foreign currency translation | (123,000,000) | |
Goodwill impaired | 0 | |
Goodwill | 15,076,000,000 | |
Client Solutions Group | ||
Goodwill [Roll Forward] | ||
Goodwill | 4,237,000,000 | |
Goodwill acquired | 0 | |
Impact of foreign currency translation | 0 | |
Goodwill impaired | 0 | |
Goodwill | 4,237,000,000 | |
VMware | ||
Goodwill [Roll Forward] | ||
Goodwill | 16,419,000,000 | |
Goodwill acquired | 272,000,000 | |
Impact of foreign currency translation | 0 | |
Goodwill impaired | 0 | |
Goodwill | 16,691,000,000 | |
Other Businesses | ||
Goodwill [Roll Forward] | ||
Goodwill | 4,234,000,000 | |
Goodwill acquired | 0 | |
Impact of foreign currency translation | (33,000,000) | |
Goodwill impaired | (207,000,000) | |
Goodwill | $ 3,994,000,000 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - VMware Acquisitions (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
May 03, 2019 | Aug. 02, 2019 | Aug. 03, 2018 | Feb. 01, 2019 | |
Business Acquisition [Line Items] | ||||
Payments to acquire businesses, net | $ 384,000,000 | $ 0 | ||
Goodwill | 39,998,000,000 | $ 40,089,000,000 | ||
VMware | ||||
Business Acquisition [Line Items] | ||||
Goodwill | 16,691,000,000 | $ 16,419,000,000 | ||
VMware | Avi Network, Inc. | ||||
Business Acquisition [Line Items] | ||||
Payments to acquire businesses, net | 326,000,000 | |||
Cash acquired from acquisition | 9,000,000 | |||
Identifiable intangible assets acquired | 94,000,000 | |||
Goodwill | 228,000,000 | |||
Goodwill, expected tax deductible amount | $ 0 | |||
VMware | AetherPal Inc. | ||||
Business Acquisition [Line Items] | ||||
Identifiable intangible assets acquired | $ 12,000,000 | |||
Goodwill | 33,000,000 | |||
Goodwill, expected tax deductible amount | 0 | |||
Consideration transferred | $ 45,000,000 |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS - Goodwill Impairment Tests (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Aug. 02, 2019 | Nov. 02, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | Feb. 01, 2019 | Feb. 03, 2017 | |
Business Acquisition [Line Items] | ||||||
Goodwill | $ 39,998,000,000 | $ 39,998,000,000 | $ 40,089,000,000 | |||
Goodwill impaired | 207,000,000 | $ 0 | ||||
Impairments | 619,000,000 | $ 0 | ||||
Effective Income Tax Rate Reconciliation, Nondeductible Expense, Impairment Losses, Amount | 95,000,000 | |||||
Reduction in property, plant and equipment | 5,568,000,000 | 5,568,000,000 | 5,259,000,000 | |||
Other Businesses | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | 3,994,000,000 | 3,994,000,000 | $ 4,234,000,000 | |||
Goodwill impaired | 207,000,000 | |||||
Virtustream | Other Businesses | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | $ 400,000,000 | |||||
Goodwill impaired | 207,000,000 | $ 190,000,000 | ||||
Goodwill, fair value | $ 200,000,000 | |||||
Impairments | 619,000,000 | |||||
Asset impairment charges net of tax | 524,000,000 | |||||
Reduction of intangible assets | 266,000,000 | |||||
Reduction in property, plant and equipment | $ 146,000,000 | $ 146,000,000 | ||||
RSA Security | Other Businesses | ||||||
Business Acquisition [Line Items] | ||||||
Percentage of fair value over carrying amount | 11.00% | 20.00% |
GOODWILL AND INTANGIBLE ASSET_5
GOODWILL AND INTANGIBLE ASSETS - Intangible Assets (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | Feb. 01, 2019 | |
Business Acquisition [Line Items] | |||||
Gross | $ 39,444,000,000 | $ 39,444,000,000 | $ 39,870,000,000 | ||
Accumulated Amortization | (23,480,000,000) | (23,480,000,000) | (21,355,000,000) | ||
Total | 15,964,000,000 | 15,964,000,000 | 18,515,000,000 | ||
Total intangible assets | 43,199,000,000 | 43,199,000,000 | 43,625,000,000 | ||
Intangible assets, net | 19,719,000,000 | 19,719,000,000 | 22,270,000,000 | ||
Amortization expense | 1,100,000,000 | $ 1,500,000,000 | 2,300,000,000 | $ 3,000,000,000 | |
Impairment charges related to intangible assets acquired | $ 0 | $ 0 | |||
Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Gross | 22,712,000,000 | 22,712,000,000 | 22,750,000,000 | ||
Accumulated Amortization | (12,828,000,000) | (12,828,000,000) | (11,703,000,000) | ||
Total | 9,884,000,000 | 9,884,000,000 | 11,047,000,000 | ||
Developed technology | |||||
Business Acquisition [Line Items] | |||||
Gross | 15,450,000,000 | 15,450,000,000 | 15,701,000,000 | ||
Accumulated Amortization | (9,941,000,000) | (9,941,000,000) | (9,036,000,000) | ||
Total | 5,509,000,000 | 5,509,000,000 | 6,665,000,000 | ||
Trade names | |||||
Business Acquisition [Line Items] | |||||
Gross | 1,282,000,000 | 1,282,000,000 | 1,291,000,000 | ||
Accumulated Amortization | (711,000,000) | (711,000,000) | (606,000,000) | ||
Total | 571,000,000 | 571,000,000 | 685,000,000 | ||
Leasehold assets (liabilities) | |||||
Business Acquisition [Line Items] | |||||
Gross | 0 | 0 | 128,000,000 | ||
Accumulated Amortization | 0 | 0 | (10,000,000) | ||
Total | 0 | 0 | 118,000,000 | ||
Trade names | |||||
Business Acquisition [Line Items] | |||||
Indefinite-lived trade names | $ 3,755,000,000 | $ 3,755,000,000 | $ 3,755,000,000 |
GOODWILL AND INTANGIBLE ASSET_6
GOODWILL AND INTANGIBLE ASSETS - Amortization Expense (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2020 (remaining six months) | $ 2,095 | |
2021 | 3,325 | |
2022 | 2,619 | |
2023 | 1,743 | |
2024 | 1,386 | |
Thereafter | 4,796 | |
Total | $ 15,964 | $ 18,515 |
DEFERRED REVENUE - Changes in D
DEFERRED REVENUE - Changes in Deferred Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | Feb. 01, 2019 | |
Deferred revenue: | |||||
Deferred revenue at beginning of period | $ 24,178 | $ 20,959 | $ 24,010 | $ 20,816 | |
Revenue deferrals for new contracts and changes in estimates for pre-existing contracts | 5,975 | 4,988 | 10,875 | 9,313 | |
Revenue recognized | (4,805) | (4,247) | (9,537) | (8,429) | |
Deferred revenue at end of period | 25,348 | 21,700 | 25,348 | 21,700 | |
Short-term deferred revenue | 13,568 | 11,965 | 13,568 | 11,965 | $ 12,944 |
Long-term deferred revenue | $ 11,780 | $ 9,735 | $ 11,780 | $ 9,735 | $ 11,066 |
DEFERRED REVENUE - Additional N
DEFERRED REVENUE - Additional Narrative (Details) $ in Billions | Aug. 02, 2019USD ($) |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation, amount | $ 33 |
DEFERRED REVENUE - Remaining Pe
DEFERRED REVENUE - Remaining Performance Obligation, Expected Timing (Details) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-08-03 | Aug. 02, 2019 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Remaining performance obligation percentage | 61.00% |
Deferred revenue recognition period | 12 months |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) | 6 Months Ended |
Aug. 02, 2019plaintiff | |
Class V Transaction Class Action Case | |
Loss Contingencies [Line Items] | |
Number of stockholders | 4 |
INCOME AND OTHER TAXES - Narrat
INCOME AND OTHER TAXES - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Aug. 02, 2019 | May 03, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | Feb. 01, 2019 | |
Operating Loss Carryforwards [Line Items] | ||||||
Effective income tax rate | 3912.60% | 1.50% | 1895.70% | 8.40% | ||
Pre-tax losses | $ (111) | $ (468) | $ (254) | $ (1,091) | ||
Discrete tax benefit from intra-entity asset transfer | 4,500 | $ 405 | ||||
Discrete tax expense relating to change in certain foreign tax credits associated with U.S. Tax Reform | 273 | 273 | ||||
Discrete tax benefit relating to virtustream impairment charges | 95 | |||||
Discrete tax benefit from adoption of revenue standard | $ 154 | |||||
Unrecognized tax benefits | 3,500 | 3,500 | $ 3,400 | |||
Minimum | ||||||
Operating Loss Carryforwards [Line Items] | ||||||
Reasonably possible decrease in unrecognized tax benefits | 500 | 500 | ||||
Maximum | ||||||
Operating Loss Carryforwards [Line Items] | ||||||
Reasonably possible decrease in unrecognized tax benefits | $ 800 | $ 800 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - Changes in Accumulated Other Comprehensive Loss, Net of Tax (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | |
AOCI [Roll Forward] | ||||
Balance, beginning of period | $ (1,661) | $ 16,980 | $ (942) | $ 17,485 |
Total other comprehensive loss, net of tax expense of $0 and $5, respectively, and $7 and $7, respectively | (40) | (212) | (97) | (410) |
Less: Change in comprehensive income attributable to non-controlling interests | 0 | 1 | 1 | (4) |
Balance, end of period | 3,095 | 15,211 | 3,095 | 15,211 |
Accumulated Other Comprehensive Income (Loss) | ||||
AOCI [Roll Forward] | ||||
Balance, beginning of period | (525) | (121) | (467) | 130 |
Other comprehensive income (loss) before reclassifications | 29 | |||
Amounts reclassified from accumulated other comprehensive income (loss) | (126) | |||
Total other comprehensive loss, net of tax expense of $0 and $5, respectively, and $7 and $7, respectively | (97) | |||
Less: Change in comprehensive income attributable to non-controlling interests | 1 | |||
Balance, end of period | (565) | $ (334) | (565) | $ (334) |
Foreign Currency Translation Adjustments | ||||
AOCI [Roll Forward] | ||||
Balance, beginning of period | (452) | |||
Balance, end of period | (688) | (688) | ||
Investments | ||||
AOCI [Roll Forward] | ||||
Balance, beginning of period | 0 | |||
Balance, end of period | 0 | 0 | ||
Cash Flow Hedges | ||||
AOCI [Roll Forward] | ||||
Balance, beginning of period | (29) | |||
Balance, end of period | 101 | 101 | ||
Pension and Other Postretirement Plans | ||||
AOCI [Roll Forward] | ||||
Balance, beginning of period | 14 | |||
Balance, end of period | $ 22 | 22 | ||
Foreign Currency Translation Adjustments Including Portion Attributable to Noncontrolling Interest | ||||
AOCI [Roll Forward] | ||||
Other comprehensive income (loss) before reclassifications | (236) | |||
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | |||
Total other comprehensive loss, net of tax expense of $0 and $5, respectively, and $7 and $7, respectively | (236) | |||
Investments | ||||
AOCI [Roll Forward] | ||||
Other comprehensive income (loss) before reclassifications | 0 | |||
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | |||
Total other comprehensive loss, net of tax expense of $0 and $5, respectively, and $7 and $7, respectively | 0 | |||
Cash Flow Hedges Including Portion Attributable to Noncontrolling Interests | ||||
AOCI [Roll Forward] | ||||
Other comprehensive income (loss) before reclassifications | 257 | |||
Amounts reclassified from accumulated other comprehensive income (loss) | (126) | |||
Total other comprehensive loss, net of tax expense of $0 and $5, respectively, and $7 and $7, respectively | 131 | |||
Pension and Other Postretirement Plans Including Portion Attributable to Noncontrolling Interest | ||||
AOCI [Roll Forward] | ||||
Other comprehensive income (loss) before reclassifications | 8 | |||
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | |||
Total other comprehensive loss, net of tax expense of $0 and $5, respectively, and $7 and $7, respectively | 8 | |||
Foreign Currency Translation Adjustments Portion Attributable to Noncontrolling Interest | ||||
AOCI [Roll Forward] | ||||
Less: Change in comprehensive income attributable to non-controlling interests | 0 | |||
Investments Attributable to Noncontrolling Interests | ||||
AOCI [Roll Forward] | ||||
Less: Change in comprehensive income attributable to non-controlling interests | 0 | |||
Cash Flow Hedges Attributable to Noncontrolling Interests | ||||
AOCI [Roll Forward] | ||||
Less: Change in comprehensive income attributable to non-controlling interests | 1 | |||
Pension and Other Postretirement Plans Portion Attributable to Noncontrolling Interest | ||||
AOCI [Roll Forward] | ||||
Less: Change in comprehensive income attributable to non-controlling interests | $ 0 |
ACCUMULATED OTHER COMPREHENSI_4
ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) - Reclassifications Out of Accumulated Other Comprehensive Income (Loss), Net of Tax, to Net Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Net revenue | $ 23,370 | $ 22,942 | $ 45,278 | $ 44,298 |
Cost of net revenue | (16,044) | (16,819) | (31,155) | (32,297) |
Interest and other, net | (630) | (455) | (1,323) | (925) |
Net income (loss) | 4,232 | (461) | 4,561 | (999) |
Total reclassifications, net of tax | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Net revenue | 68 | 77 | 126 | 46 |
Cost of net revenue | 0 | 0 | 0 | 0 |
Interest and other, net | 0 | 0 | 0 | 1 |
Net income (loss) | 68 | 77 | 126 | 47 |
Total reclassifications, net of tax | Investments | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Net revenue | 0 | 0 | 0 | 0 |
Cost of net revenue | 0 | 0 | 0 | 0 |
Interest and other, net | 0 | 0 | 0 | 1 |
Net income (loss) | 0 | 0 | 0 | 1 |
Total reclassifications, net of tax | Cash Flow Hedges | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Net revenue | 68 | 77 | 126 | 46 |
Cost of net revenue | 0 | 0 | 0 | 0 |
Interest and other, net | 0 | 0 | 0 | 0 |
Net income (loss) | $ 68 | $ 77 | $ 126 | $ 46 |
NON-CONTROLLING INTERESTS - Add
NON-CONTROLLING INTERESTS - Additional Information (Narrative) (Details) - USD ($) $ in Millions | Aug. 02, 2019 | May 03, 2019 | Feb. 01, 2019 | Aug. 03, 2018 | May 04, 2018 | Feb. 02, 2018 |
Noncontrolling Interest [Line Items] | ||||||
Non-controlling interests | $ 3,095 | $ (1,661) | $ (942) | $ 15,211 | $ 16,980 | $ 17,485 |
Non-controlling interests | ||||||
Noncontrolling Interest [Line Items] | ||||||
Non-controlling interests | $ 5,544 | $ 4,803 | $ 4,823 | $ 6,648 | $ 6,495 | $ 5,766 |
VMware, Inc. | ||||||
Noncontrolling Interest [Line Items] | ||||||
Outstanding equity interest held (as a percent) | 80.80% | 80.50% | ||||
VMware, Inc. | Non-controlling interests | ||||||
Noncontrolling Interest [Line Items] | ||||||
Non-controlling interests | $ 4,400 | $ 3,800 | ||||
Pivotal | ||||||
Noncontrolling Interest [Line Items] | ||||||
Outstanding equity interest held (as a percent) | 60.90% | 62.80% | ||||
Pivotal | Non-controlling interests | ||||||
Noncontrolling Interest [Line Items] | ||||||
Non-controlling interests | $ 1,000 | $ 1,000 | ||||
SecureWorks | ||||||
Noncontrolling Interest [Line Items] | ||||||
Outstanding equity interest held (as a percent) | 87.00% | 87.40% | ||||
Outstanding equity interest, including RSAs (as a percent) | 86.20% | 86.40% | ||||
SecureWorks | Non-controlling interests | ||||||
Noncontrolling Interest [Line Items] | ||||||
Non-controlling interests | $ 87 | $ 87 |
NON-CONTROLLING INTERESTS - Eff
NON-CONTROLLING INTERESTS - Effect of Changes in Ownership Interests of Less than Wholly Owned Subsidiaries (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | |
Noncontrolling Interest [Abstract] | ||||
Net income attributable to Dell Technologies Inc. | $ 3,416 | $ (499) | $ 3,709 | $ (1,135) |
Transfers (to)/from the non-controlling interests: | ||||
Increase in Dell Technologies Inc. additional paid-in-capital for equity issuances and other equity activity | 379 | |||
Decrease in Dell Technologies Inc. additional paid-in-capital and accumulated deficit for equity issuances and other equity activity | (1,036) | |||
Net transfers to non-controlling interests | (657) | |||
Change from net income attributable to Dell Technologies Inc. and transfers to the non-controlling interests | $ 3,052 |
CAPITALIZATION - Schedule of St
CAPITALIZATION - Schedule of Stock by Class (Details) - shares shares in Millions | Aug. 02, 2019 | Feb. 01, 2019 |
Class of Stock [Line Items] | ||
Authorized (in shares) | 9,143 | 9,143 |
Issued (in shares) | 726 | 721 |
Outstanding shares (in shares) | 724 | 719 |
Class A | ||
Class of Stock [Line Items] | ||
Authorized (in shares) | 600 | 600 |
Issued (in shares) | 374 | 410 |
Outstanding shares (in shares) | 374 | 410 |
Class B | ||
Class of Stock [Line Items] | ||
Authorized (in shares) | 200 | 200 |
Issued (in shares) | 119 | 137 |
Outstanding shares (in shares) | 119 | 137 |
Class C | ||
Class of Stock [Line Items] | ||
Authorized (in shares) | 7,900 | 7,900 |
Issued (in shares) | 233 | 174 |
Outstanding shares (in shares) | 231 | 172 |
Class D | ||
Class of Stock [Line Items] | ||
Authorized (in shares) | 100 | 100 |
Issued (in shares) | 0 | 0 |
Outstanding shares (in shares) | 0 | 0 |
Class V | ||
Class of Stock [Line Items] | ||
Authorized (in shares) | 343 | 343 |
Issued (in shares) | 0 | 0 |
Outstanding shares (in shares) | 0 | 0 |
CAPITALIZATION - Additional Inf
CAPITALIZATION - Additional Information (Narrative) (Details) | Dec. 28, 2018USD ($)shares | Nov. 14, 2018$ / shares | Aug. 03, 2018USD ($) | Aug. 02, 2019USD ($)votes$ / sharesshares | Aug. 03, 2018USD ($)shares | May 29, 2019USD ($) | Feb. 01, 2019USD ($)shares |
Class of Stock [Line Items] | |||||||
Preferred stock, authorized (in shares) | 1,000,000 | ||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | ||||||
Preferred stock, issued (in shares) | 0 | 0 | |||||
Preferred stock, outstanding (in shares) | 0 | 0 | |||||
Outstanding shares (in shares) | 724,000,000 | 719,000,000 | |||||
Aggregate purchase price | $ | $ 10,000,000 | $ 2,000,000 | $ 47,000,000 | ||||
Accumulated deficit on repurchase | $ | $ (17,775,000,000) | $ (21,349,000,000) | |||||
Class V Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Outstanding shares (in shares) | 0 | 0 | |||||
Class A | |||||||
Class of Stock [Line Items] | |||||||
Outstanding shares (in shares) | 374,000,000 | 410,000,000 | |||||
Number of voting interests per share | votes | 10 | ||||||
Conversion of stock, shares issued (in shares) | 35,673,230 | ||||||
Class B | |||||||
Class of Stock [Line Items] | |||||||
Outstanding shares (in shares) | 119,000,000 | 137,000,000 | |||||
Number of voting interests per share | votes | 10 | ||||||
Conversion of stock, shares issued (in shares) | 17,650,820 | ||||||
Class C | |||||||
Class of Stock [Line Items] | |||||||
Outstanding shares (in shares) | 231,000,000 | 172,000,000 | |||||
Number of voting interests per share | votes | 1 | ||||||
Class D | |||||||
Class of Stock [Line Items] | |||||||
Outstanding shares (in shares) | 0 | 0 | |||||
Number of voting interests per share | votes | 1 | ||||||
Class V Common Stock Owners | Class V Common Stock | |||||||
Class of Stock [Line Items] | |||||||
Outstanding shares (in shares) | 0 | ||||||
VMware, Inc. | |||||||
Class of Stock [Line Items] | |||||||
Accumulated deficit on repurchase | $ | $ 100,000,000 | ||||||
VMware, Inc. | Class A | |||||||
Class of Stock [Line Items] | |||||||
Stock repurchases, authorized amount | $ | $ 1,500,000,000 | ||||||
Shares repurchased (in shares) | 5,700,000 | 0 | |||||
Aggregate purchase price | $ | $ 1,000,000,000 | ||||||
Merger Agreement | |||||||
Class of Stock [Line Items] | |||||||
Cash payment | $ | $ 14,000,000,000 | ||||||
Shares issued (in shares) | 149,387,617 | ||||||
Equity issued in acquisition | $ | $ 6,900,000,000 | ||||||
Cash dividend received and used to fund acquisition | $ | 8,870,000,000 | ||||||
Per share cash consideration (in dollars per share) | $ / shares | $ 120 | ||||||
Merger Agreement | VMware, Inc. | |||||||
Class of Stock [Line Items] | |||||||
Conditional one-time special cash dividend | $ | 11,000,000,000 | ||||||
January 2017 and August 2017 Authorizations | Class A | |||||||
Class of Stock [Line Items] | |||||||
Stock repurchases, authorized amount | $ | 3,700,000,000 | ||||||
Stock repurchases, remaining authorized amount | $ | $ 1,300,000,000 | ||||||
Line of Credit | Merger Agreement | |||||||
Class of Stock [Line Items] | |||||||
Proceeds from issuance of debt | $ | 3,670,000,000 | ||||||
Margin Loan Facility | Merger Agreement | |||||||
Class of Stock [Line Items] | |||||||
Proceeds from issuance of debt | $ | $ 1,350,000,000 |
EARNINGS (LOSS) PER SHARE - Add
EARNINGS (LOSS) PER SHARE - Additional Information (Narrative) (Details) - common_stock_group | Feb. 01, 2019 | Dec. 28, 2018 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Number of groups of common stock | 2 | |
Class V Common Stock | Class V Common Stock Owners | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Economic interest (as a percent) | 61.00% |
EARNINGS (LOSS) PER SHARE - Sch
EARNINGS (LOSS) PER SHARE - Schedule of Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||||
Net Income (Loss) Attributable to Parent | $ 3,416 | $ (499) | $ 3,709 | $ (1,135) |
Earnings (loss) per share attributable to Dell Technologies Inc. - basic: | ||||
Earnings (loss) per share - basic (in dollars per share) | $ 4.75 | $ 5.17 | ||
Earnings (loss) per share attributable to Dell Technologies Inc. - diluted: | ||||
Earnings (loss) per share - diluted (in dollars per share) | $ 4.47 | $ 4.84 | ||
Numerator: Continuing operations | ||||
Net income (loss) - basic | $ 3,416 | |||
Incremental dilution from VMware | (62) | |||
Net income (loss) - diluted | $ 3,354 | |||
Denominator: weighted-average shares outstanding | ||||
Weighted-average shares outstanding - basic (in shares) | 719 | |||
Dilutive effect of options, restricted stock units, restricted stock, and other (in shares) | 32 | |||
Weighted-average shares outstanding - diluted (in shares) | 751 | |||
Weighted-average shares outstanding - antidilutive (in shares) | 1 | |||
Class V Common Stock | ||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||||
Net Income (Loss) Attributable to Parent | $ 320 | $ 790 | ||
Earnings (loss) per share attributable to Dell Technologies Inc. - basic: | ||||
Earnings (loss) per share - basic (in dollars per share) | $ 1.61 | $ 3.97 | ||
Earnings (loss) per share attributable to Dell Technologies Inc. - diluted: | ||||
Earnings (loss) per share - diluted (in dollars per share) | $ 1.58 | $ 3.91 | ||
Numerator: Continuing operations | ||||
Incremental dilution from VMware | $ (5) | $ (12) | ||
Net income (loss) - diluted | $ 315 | $ 778 | ||
Denominator: weighted-average shares outstanding | ||||
Weighted-average shares outstanding - basic (in shares) | 199 | 199 | ||
Dilutive effect of options, restricted stock units, restricted stock, and other (in shares) | 0 | 0 | ||
Weighted-average shares outstanding - diluted (in shares) | 199 | 199 | ||
Weighted-average shares outstanding - antidilutive (in shares) | 0 | 0 | ||
DHI Group | ||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | ||||
Net Income (Loss) Attributable to Parent | $ (819) | $ (1,925) | ||
Earnings (loss) per share attributable to Dell Technologies Inc. - basic: | ||||
Earnings (loss) per share - basic (in dollars per share) | $ (1.44) | $ (3.39) | ||
Earnings (loss) per share attributable to Dell Technologies Inc. - diluted: | ||||
Earnings (loss) per share - diluted (in dollars per share) | $ (1.45) | $ (3.40) | ||
Numerator: Continuing operations | ||||
Net income (loss) - basic | $ 3,709 | |||
Incremental dilution from VMware | $ (4) | (78) | $ (8) | |
Net income (loss) - diluted | $ (823) | $ 3,631 | $ (1,933) | |
Denominator: weighted-average shares outstanding | ||||
Weighted-average shares outstanding - basic (in shares) | 567 | 718 | 568 | |
Dilutive effect of options, restricted stock units, restricted stock, and other (in shares) | 0 | 32 | 0 | |
Weighted-average shares outstanding - diluted (in shares) | 567 | 750 | 568 | |
Weighted-average shares outstanding - antidilutive (in shares) | 47 | 1 | 48 |
EARNINGS (LOSS) PER SHARE - Rec
EARNINGS (LOSS) PER SHARE - Reconciliation of Net Income (Loss) From Continuing Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | |
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Net income attributable to Dell Technologies Inc. | $ 3,416 | $ (499) | $ 3,709 | $ (1,135) |
Class V Common Stock | ||||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Net income attributable to Dell Technologies Inc. | 320 | 790 | ||
DHI Group | ||||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Net income attributable to Dell Technologies Inc. | $ (819) | $ (1,925) |
STOCK-BASED COMPENSATION - Narr
STOCK-BASED COMPENSATION - Narrative (Details) - USD ($) | Mar. 15, 2019 | Aug. 02, 2019 | Aug. 02, 2019 | Feb. 01, 2019 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock options outstanding (in shares) | 42,000,000 | |||
Stock options, exercisable (in shares) | 5,000,000 | |||
Options, outstanding, weighted average exercise price (in dollars per share) | $ 16.74 | |||
Proceeds from stock options exercised | $ 88,000,000 | |||
Options, exercises in period, intrinsic value | $ 189,000,000 | |||
Serviced-based Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Grants in period (in shares) | 10,000,000 | |||
Award vesting period | 3 years | |||
Serviced-based Restricted Stock Units | Class C | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares converted (per share) | $ 1 | |||
Performance-based Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Grants in period (in shares) | 1,900,000 | |||
Performance-based Restricted Stock Units | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting percentage | 0.00% | |||
Performance-based Restricted Stock Units | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting percentage | 200.00% | |||
Performance-based Restricted Stock Units Subject To Performance Conditions | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Grants in period (in shares) | 900,000 | |||
Number of shares outstanding (in shares) | 5,000,000 | 5,000,000 | ||
Restricted Stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares outstanding (in shares) | 15,000,000 | 15,000,000 | ||
Weighted average grant date fair value (in dollars per share) | $ 49.80 | $ 49.80 | ||
Aggregate intrinsic value | $ 812,000,000 | $ 812,000,000 | ||
Unrecognized stock-based compensation expense | $ 512,000,000 | $ 512,000,000 | ||
Weighted-average recognition period of options | 2 years 7 months 6 days | |||
Dell Technologies Inc. 2013 Stock Incentive Plan | Class C | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Additional shares authorized for issuance (in shares) | 35,000,000 | |||
Shares authorized for for share-based payment awards (in shares) | 110,500,000 | 110,500,000 | ||
Share-based compensation arrangement by share-based payment award, number of shares available for grant | 54,000,000 | 54,000,000 |
STOCK-BASED COMPENSATION - Valu
STOCK-BASED COMPENSATION - Valuation Assumptions (Details) - RSUs | 6 Months Ended |
Aug. 02, 2019$ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Weighted average grant date fair value (in dollars per share) | $ 87.17 |
Expected term (in years) | 3 years |
Risk-free rate (U.S. Government Treasury Note) | 2.40% |
Expected volatility | 45.00% |
Expected dividend yield | 0.00% |
REDEEMABLE SHARES (Details)
REDEEMABLE SHARES (Details) - USD ($) shares in Millions, $ in Millions | 6 Months Ended | |
Aug. 02, 2019 | Feb. 01, 2019 | |
Temporary Equity [Line Items] | ||
Holding period | 6 months | |
Expiration period | 2 years | |
Redeemable shares classified as temporary equity | $ 1,024 | $ 1,196 |
Common Stock | ||
Temporary Equity [Line Items] | ||
Redeemable shares issued (in shares) | 2 | 3 |
Redeemable shares outstanding (in shares) | 2 | 3 |
RSUs | ||
Temporary Equity [Line Items] | ||
Redeemable shares issued (in shares) | 1 | 1 |
Redeemable shares outstanding (in shares) | 1 | 1 |
RSAs | ||
Temporary Equity [Line Items] | ||
Redeemable shares issued (in shares) | 0 | 0 |
Redeemable shares outstanding (in shares) | 0 | 0 |
Employee Stock Option | ||
Temporary Equity [Line Items] | ||
Redeemable shares issued (in shares) | 23 | 31 |
Redeemable shares outstanding (in shares) | 23 | 31 |
SEGMENT INFORMATION - Additiona
SEGMENT INFORMATION - Additional Information (Narrative) (Details) | 6 Months Ended |
Aug. 02, 2019segments | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
SEGMENT INFORMATION - Reconcili
SEGMENT INFORMATION - Reconciliation of net revenue by reportable segments to consolidated net revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | |
Segment Reporting Information [Line Items] | ||||
Total net revenue | $ 23,370 | $ 22,942 | $ 45,278 | $ 44,298 |
Consolidated operating income (loss) | 519 | (13) | 1,069 | (166) |
Amortization of intangibles | (1,100) | (1,500) | (2,300) | (3,000) |
Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 22,835 | 22,549 | 44,229 | 43,515 |
Consolidated operating income (loss) | 2,794 | 2,173 | 5,044 | 4,258 |
Operating segments | Infrastructure Solutions Group | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 8,621 | 9,227 | 16,823 | 17,894 |
Consolidated operating income (loss) | 1,050 | 1,012 | 1,893 | 1,951 |
Operating segments | Client Solutions Group | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 11,748 | 11,128 | 22,658 | 21,399 |
Consolidated operating income (loss) | 982 | 425 | 1,775 | 958 |
Operating segments | VMware | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 2,466 | 2,194 | 4,748 | 4,222 |
Consolidated operating income (loss) | 762 | 736 | 1,376 | 1,349 |
Operating segments | Other businesses | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 619 | 574 | 1,215 | 1,153 |
Consolidated operating income (loss) | (25) | (49) | (78) | (99) |
Unallocated transactions | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 0 | (1) | 0 | (3) |
Consolidated operating income (loss) | (26) | (16) | (27) | (25) |
Other corporate expenses | (714) | (60) | (737) | (130) |
Reconciling items | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | (84) | (180) | (166) | (367) |
Impact of purchase accounting | (102) | (215) | (203) | (437) |
Amortization of intangibles | (1,060) | (1,526) | (2,277) | (3,048) |
Transaction-related expenses | (47) | (104) | (89) | (270) |
Stock-based compensation expense | $ (301) | $ (216) | $ (564) | $ (415) |
SEGMENT INFORMATION - Net reven
SEGMENT INFORMATION - Net revenue and property, plant and equipment (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | $ 23,370 | $ 22,942 | $ 45,278 | $ 44,298 |
Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 22,835 | 22,549 | 44,229 | 43,515 |
Operating segments | Infrastructure Solutions Group | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 8,621 | 9,227 | 16,823 | 17,894 |
Operating segments | Infrastructure Solutions Group | Servers and networking | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 4,437 | 5,061 | 8,617 | 9,646 |
Operating segments | Infrastructure Solutions Group | Storage | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 4,184 | 4,166 | 8,206 | 8,248 |
Operating segments | Client Solutions Group | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 11,748 | 11,128 | 22,658 | 21,399 |
Operating segments | Client Solutions Group | Commercial | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 9,077 | 8,109 | 17,384 | 15,472 |
Operating segments | Client Solutions Group | Consumer | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | 2,671 | 3,019 | 5,274 | 5,927 |
Operating segments | VMware | ||||
Disaggregation of Revenue [Line Items] | ||||
Total net revenue | $ 2,466 | $ 2,194 | $ 4,748 | $ 4,222 |
SUPPLEMENTAL CONSOLIDATED FIN_3
SUPPLEMENTAL CONSOLIDATED FINANCIAL INFORMATION - Information on Selected Accounts (Details) - USD ($) $ in Millions | Aug. 02, 2019 | Feb. 01, 2019 | Aug. 03, 2018 |
Cash, cash equivalents, and restricted cash: | |||
Cash and cash equivalents | $ 9,193 | $ 9,676 | |
Restricted cash - current assets | 616 | 522 | |
Restricted cash - other non-current assets | 126 | 42 | |
Total cash, cash equivalents, and restricted cash | 9,935 | 10,240 | |
Inventories, net: | |||
Production materials | 1,441 | 1,794 | |
Work-in-process | 623 | 702 | |
Finished goods | 1,071 | 1,153 | |
Total inventories, net | 3,135 | 3,649 | |
Other non-current liabilities: | |||
Warranty liability | 170 | 169 | $ 176 |
Deferred and other tax liabilities | 4,605 | 5,527 | |
Non-current operating lease liabilities | 1,234 | 0 | |
Other | 619 | 631 | |
Total other non-current liabilities | $ 6,628 | $ 6,327 |
SUPPLEMENTAL CONSOLIDATED FIN_4
SUPPLEMENTAL CONSOLIDATED FINANCIAL INFORMATION - Warranty Liability (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Aug. 02, 2019 | Aug. 03, 2018 | Aug. 02, 2019 | Aug. 03, 2018 | Feb. 01, 2019 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | |||||
Warranty liability at beginning of period | $ 500 | $ 527 | $ 524 | $ 539 | |
Costs accrued for new warranty contracts and changes in estimated for pre-existing warranties | 237 | 236 | 440 | 430 | |
Service obligations honored | (212) | (221) | (439) | (427) | |
Warranty liability at end of period | 525 | 542 | 525 | 542 | |
Current portion | 355 | 366 | 355 | 366 | |
Non-current portion | $ 170 | $ 176 | $ 170 | $ 176 | $ 169 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) | 6 Months Ended | ||||
Jan. 31, 2020 | Aug. 02, 2019 | Aug. 03, 2018 | Sep. 05, 2019 | Feb. 01, 2019 | |
Subsequent Event [Line Items] | |||||
Payments to acquire businesses, net of cash acquired | $ 384,000,000 | $ 0 | |||
Total debt, principal amount | 52,592,000,000 | $ 54,239,000,000 | |||
VMware | Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Ownership interest by parent | 81.10% | ||||
VMware | Carbon Black | Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Business acquisition, share price (in dollars per share) | $ 26 | ||||
Payments to acquire businesses, net of cash acquired | $ 1,900,000,000 | ||||
VMware | Pivotal | Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Business acquisition, share price (in dollars per share) | $ 11.71 | ||||
Payments to acquire businesses, net of cash acquired | $ 800,000,000 | ||||
Business acquisition shares received on exchange (in shares) | 7,200,000 | ||||
Increase in ownership percentage by parent | 0.30% | ||||
VMware | Class A | Pivotal | Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Business acquisition, share price (in dollars per share) | $ 15 | ||||
VMware | Class B | Pivotal | Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Business acquisition exchange of shares ratio (in shares) | 0.0550 | ||||
VMware | Unsecured Debt | Senior Unsecured Term Loan Facility | Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Maximum borrowing capacity | $ 2,000,000,000 | ||||
Secured Debt | 4.24% Term Loan B Facility due September 2023 | |||||
Subsequent Event [Line Items] | |||||
Total debt, principal amount | $ 4,913,000,000 | $ 4,938,000,000 | |||
Secured Debt | 4.24% Term Loan B Facility due September 2023 | Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Total debt, principal amount | $ 4,900,000,000 | ||||
Secured Debt | Term Loan B Facility Due 2025 | Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Maximum borrowing capacity | $ 4,000,000,000 |
Uncategorized Items - delltechn
Label | Element | Value |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (5,000,000) |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 3,000,000 |
AOCI Attributable to Parent [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | (58,000,000) |
Noncontrolling Interest [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | (5,000,000) |
Parent [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 3,000,000 |
Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | 58,000,000 |
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 3,000,000 |