Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Jan. 31, 2015 | Jun. 30, 2014 | |
Document-Document and Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 31-Dec-14 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | EMC | ||
Entity Registrant Name | EMC CORP | ||
Entity Central Index Key | 790070 | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 1,988,086,911 | ||
Entity Public Float | $53,268,882,932 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $6,343 | $7,891 |
Short-term investments | 1,978 | 2,773 |
Accounts and notes receivable, less allowance for doubtful accounts of $72 and $62 | 4,413 | 3,861 |
Inventories | 1,276 | 1,334 |
Deferred income taxes | 1,070 | 912 |
Other current assets | 653 | 507 |
Total current assets | 15,733 | 17,278 |
Long-term investments | 6,334 | 6,924 |
Property, plant and equipment, net | 3,766 | 3,478 |
Intangible assets, net | 2,125 | 1,780 |
Goodwill | 16,134 | 14,424 |
Other assets, net | 1,793 | 1,965 |
Total assets | 45,885 | 45,849 |
Current liabilities: | ||
Accounts payable | 1,696 | 1,434 |
Accrued expenses | 3,141 | 2,783 |
Notes converted and payable | 0 | 1,665 |
Income taxes payable | 852 | 639 |
Deferred revenue | 6,021 | 5,278 |
Total current liabilities | 11,710 | 11,799 |
Income taxes payable | 306 | 296 |
Deferred revenue | 4,144 | 3,701 |
Deferred income taxes | 274 | 421 |
Long-term debt | 5,495 | 5,494 |
Other liabilities | 431 | 352 |
Total liabilities | 22,360 | 22,063 |
Commitments and contingencies (See Note N) | ||
Shareholders’ equity: | ||
Preferred stock, par value $0.01; authorized 25 shares; none outstanding | 0 | 0 |
Common stock, par value $0.01; authorized 6,000 shares; issued and outstanding 1,985 and 2,020 shares | 20 | 20 |
Additional paid-in capital | 0 | 1,406 |
Retained earnings | 22,242 | 21,114 |
Accumulated other comprehensive income (loss), net | -366 | -239 |
Total EMC Corporation’s shareholders’ equity | 21,896 | 22,301 |
Non-controlling interests | 1,629 | 1,485 |
Total shareholders’ equity | 23,525 | 23,786 |
Total liabilities and shareholders’ equity | $45,885 | $45,849 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, except Share data, unless otherwise specified | ||
Accounts and notes receivable, allowance for doubtful accounts | $72 | $62 |
Preferred stock, par value (in usd per share) | $0.01 | $0.01 |
Preferred stock, authorized (in shares) | 25,000,000 | 25,000,000 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $0.01 | $0.01 |
Common stock, authorized (in shares) | 6,000,000,000 | 6,000,000,000 |
Common stock, issued (in shares) | 1,985,000,000 | 2,020,000,000 |
Common stock, outstanding (in shares) | 1,985,000,000 | 2,020,000,000 |
CONSOLIDATED_INCOME_STATEMENTS
CONSOLIDATED INCOME STATEMENTS (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Revenues: | |||
Product sales | $14,051 | $13,690 | $13,061 |
Services | 10,389 | 9,532 | 8,653 |
Total consolidated revenues | 24,440 | 23,222 | 21,714 |
Costs and expenses: | |||
Cost of product sales | 5,738 | 5,650 | 5,259 |
Cost of services | 3,453 | 3,099 | 2,817 |
Research and development | 2,991 | 2,761 | 2,560 |
Selling, general and administrative | 7,982 | 7,338 | 7,004 |
Restructuring and acquisition-related charges | 239 | 224 | 110 |
Operating income (loss) | 4,037 | 4,150 | 3,964 |
Non-operating income (expense): | |||
Investment income | 123 | 128 | 115 |
Interest expense | -147 | -156 | -79 |
Other expense, net | -251 | -257 | -196 |
Total non-operating income (expense) | -275 | -285 | -160 |
Income before provision for income taxes | 3,762 | 3,865 | 3,804 |
Income tax provision | 868 | 772 | 918 |
Net income | 2,894 | 3,093 | 2,886 |
Less: Net income attributable to the non-controlling interest in VMware, Inc. | -180 | -204 | -153 |
Net income attributable to EMC Corporation | $2,714 | $2,889 | $2,733 |
Net income per weighted average share, basic attributable to EMC Corporation common shareholders | $1.34 | $1.39 | $1.31 |
Net income per weighted average share, diluted attributable to EMC Corporation common shareholders | $1.32 | $1.33 | $1.23 |
Weighted average shares, basic | 2,028 | 2,074 | 2,093 |
Weighted average shares, diluted | 2,059 | 2,160 | 2,206 |
Cash dividends declared per common share | $0.45 | $0.30 | $0 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Statement of Comprehensive Income [Abstract] | |||
Net income | $2,894 | $3,093 | $2,886 |
Other comprehensive income (loss), net of taxes (benefits): | |||
Foreign currency translation adjustments | -135 | -44 | 2 |
Changes in market value of investments: | |||
Changes in unrealized gains (losses), net of taxes (benefits) of $36, $(13) and $31 | 57 | -22 | 53 |
Reclassification adjustment for net gains realized in net income, net of taxes of $23, $6 and $4 | -39 | -11 | -5 |
Net change in market value of investments | 18 | -33 | 48 |
Changes in market value of derivatives: | |||
Changes in market value of derivatives, net of taxes (benefits) of $2, $3 and $(20) | 24 | 13 | -36 |
Reclassification adjustment for net losses (gains) included in net income, net of benefits (taxes) of $0, $(2) and $15 | -18 | -10 | 28 |
Net change in the market value of derivatives | 6 | 3 | -8 |
Change in actuarial net gain (loss) from pension and other postretirement plans: | |||
Recognition of actuarial net gain (loss) from pension and other postretirement plans, net of taxes (benefits) of $(12), $20 and $(10) | -22 | 34 | -22 |
Reclassification adjustments for net losses from pension and other postretirement plans, net of benefits $3, $6 and $5 | -6 | -9 | -8 |
Net change in actuarial gain (loss) from pension and other postretirement plans | -16 | 43 | -14 |
Other comprehensive income (loss) | -127 | -31 | 28 |
Comprehensive income | 2,767 | 3,062 | 2,914 |
Less: Net income attributable to the non-controlling interest in VMware, Inc. | 180 | 204 | 153 |
Less: Other comprehensive (income) loss attributable to the non-controlling interest in VMware, Inc. | 0 | 0 | -2 |
Comprehensive income attributable to EMC Corporation | $2,587 | $2,858 | $2,759 |
CONSOLIDATED_STATEMENTS_OF_COM1
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Statement of Comprehensive Income [Abstract] | |||
Changes in unrealized gains (losses) - taxes (benefits) | $36 | ($13) | $31 |
Reclassification adjustment for net losses (gains) realized in net income - benefits (taxes) | 23 | 6 | 4 |
Changes in market value of derivatives - taxes (benefits) | 2 | 3 | -20 |
Reclassification adjustment for net losses (gains) realized in net income - benefits (taxes) | 0 | -2 | 15 |
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, before Reclassification Adjustments, Tax | -12 | 20 | -10 |
Other Comprehensive (Income) Loss, Reclassification Adjustment from AOCI, Pension and Other Postretirement Benefit Plans, Tax | $3 | $6 | $5 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Cash flows from operating activities: | |||
Cash received from customers | $25,360 | $24,319 | $22,585 |
Cash paid to suppliers and employees | -17,893 | -16,708 | -16,019 |
Dividends and interest received | 143 | 169 | 103 |
Interest paid | -134 | -96 | -33 |
Income taxes paid | -953 | -761 | -374 |
Net cash provided by operating activities | 6,523 | 6,923 | 6,262 |
Cash flows from investing activities: | |||
Additions to property, plant and equipment | -979 | -943 | -819 |
Capitalized software development costs | -509 | -465 | -419 |
Purchases of short- and long-term available-for-sale securities | -9,982 | -11,250 | -6,347 |
Sales of short- and long-term available-for-sale securities | 8,722 | 5,292 | 4,983 |
Maturities of short- and long-term available-for-sale securities | 2,651 | 2,845 | 1,049 |
Business acquisitions, net of cash acquired | -1,973 | -770 | -2,136 |
Purchases of strategic and other related investments | -144 | -131 | -117 |
Sales of strategic and other related investments | 101 | 35 | 70 |
Joint venture funding | -360 | -411 | -228 |
Proceeds from divestiture of business | 0 | 38 | 58 |
Increase in restricted cash | -78 | 0 | 0 |
Net cash used in investing activities | -2,551 | -5,760 | -3,906 |
Cash flows from financing activities: | |||
Proceeds from the issuance of common stock | 503 | 342 | 560 |
Repurchase of Common Stock | -2,969 | -3,015 | -685 |
EMC purchase of VMware’s common stock | 0 | -160 | -290 |
Excess tax benefits from stock-based compensation | 102 | 116 | 261 |
Payment of long-term and short-term obligations | -1,665 | -46 | -1,715 |
Proceeds from the issuance of long-term and short-term obligations | 0 | 5,460 | 5 |
Contributions from non-controlling interests | 7 | 105 | 0 |
Interest rate contract settlement | 0 | 0 | -70 |
Dividend payment | -879 | -415 | 0 |
Net cash (used in) provided by financing activities | -5,437 | 2,076 | -2,149 |
Effect of exchange rate changes on cash and cash equivalents | -83 | -62 | 15 |
Net (decrease) increase in cash and cash equivalents | -1,548 | 3,177 | 222 |
Cash and cash equivalents at beginning of period | 7,891 | 4,714 | |
Cash and cash equivalents at end of period | 6,343 | 7,891 | 4,714 |
Reconciliation of net income to net cash provided by operating activities: | |||
Net income | 2,894 | 3,093 | 2,886 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 1,864 | 1,665 | 1,528 |
Non-cash interest expense on debt | 1 | 62 | 46 |
Non-cash restructuring and other special charges | 19 | 8 | 13 |
Stock-based compensation expense | 1,031 | 935 | 895 |
Provision for (recovery of) doubtful accounts | -10 | 1 | -39 |
Deferred income taxes, net | -396 | -202 | -118 |
Excess tax benefits from stock-based compensation | -102 | -116 | -261 |
Gain on previously held interests in strategic investments and joint venture | -101 | 0 | -32 |
Impairment of strategic investment | 33 | 0 | 0 |
Other, net | 20 | 40 | 22 |
Changes in assets and liabilities, net of acquisitions: | |||
Accounts and notes receivable | -309 | -377 | -535 |
Inventories | -149 | -408 | -459 |
Other assets | 345 | 269 | 174 |
Accounts payable | 167 | 380 | 89 |
Accrued expenses | -286 | -162 | -94 |
Income taxes payable | 314 | 222 | 661 |
Deferred revenue | 1,126 | 1,475 | 1,367 |
Other liabilities | 42 | 40 | 41 |
Net cash provided by operating activities | 6,523 | 6,923 | 6,262 |
Non-cash investing and financing activity: | |||
Issuance of common stock and stock options exchanged in business acquisitions | 35 | 1 | 24 |
Investment in joint venture | 0 | 0 | 33 |
Dividends declared | 242 | 213 | 0 |
VMware | |||
Cash flows from financing activities: | |||
Proceeds from the issuance of common stock | 164 | 197 | 253 |
Repurchase of Common Stock | ($700) | ($508) | ($468) |
CONSOLIDATED_STATEMENTS_OF_SHA
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (USD $) | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Non-controlling Interest in VMware |
In Millions, unless otherwise specified | ||||||
Balance, January 1, 2012 at Dec. 31, 2011 | $20,280 | $21 | $3,405 | $16,120 | ($235) | $969 |
Beginning Balance (in shares) at Dec. 31, 2011 | 2,050 | |||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | ||||||
Stock issued through stock option and stock purchase plans | 42 | |||||
Stock issued through stock option and stock purchase plans | 560 | 0 | 560 | |||
Tax benefit from stock options exercised | 267 | 267 | ||||
Restricted stock grants, cancellations and withholdings, net | 11 | |||||
Restricted stock grants, cancellations and withholdings, net | -126 | 0 | -126 | |||
Repurchase of common stock | -27 | |||||
Repurchase of common stock | -700 | 0 | -700 | |||
EMC purchase of VMware stock | -300 | -258 | -42 | |||
Stock options issued in business acquisitions | 20 | 20 | ||||
Stock-based compensation | 898 | 898 | ||||
Impact from equity transactions of non-controlling interests | -350 | -436 | 86 | |||
Recognition of actuarial net gain (loss) from pension and other postretirement plans, net of taxes (benefits) of $(12), $20 and $(10) | -14 | -14 | ||||
Change in market value of investments | 48 | 47 | 1 | |||
Net change in the market value of derivatives | -8 | -8 | 0 | |||
Translation adjustment | 2 | 2 | ||||
Stock Issued During Period Shares Stock Conversion Of Convertible Securities And Warrants | 31 | |||||
Stock Issued During Period Value Stock Conversion Of Convertible Securities And Warrants | -1 | -1 | ||||
Reclassification of convertible debt (to)/from mezzanine (Note E) | 62 | 62 | ||||
Net income | 2,886 | 2,733 | 153 | |||
Balance, December 31, 2012 at Dec. 31, 2012 | 23,524 | 21 | 3,691 | 18,853 | -208 | 1,167 |
Ending Balance (in shares) at Dec. 31, 2012 | 2,107 | |||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | ||||||
Stock issued through stock option and stock purchase plans | 24 | |||||
Stock issued through stock option and stock purchase plans | 342 | 0 | 342 | |||
Tax benefit from stock options exercised | 90 | 90 | ||||
Restricted stock grants, cancellations and withholdings, net | 11 | |||||
Restricted stock grants, cancellations and withholdings, net | -126 | 0 | -126 | |||
Repurchase of common stock | -122 | |||||
Repurchase of common stock | -3,000 | -1 | -2,999 | |||
EMC purchase of VMware stock | -150 | -124 | -26 | |||
Stock options issued in business acquisitions | 1 | 1 | ||||
Stock-based compensation | 946 | 946 | ||||
Cash dividends declared | -628 | -628 | ||||
Impact from equity transactions of non-controlling interests | -333 | -473 | 140 | |||
Recognition of actuarial net gain (loss) from pension and other postretirement plans, net of taxes (benefits) of $(12), $20 and $(10) | 43 | 43 | ||||
Change in market value of investments | -33 | -33 | 0 | |||
Net change in the market value of derivatives | 3 | 3 | 0 | |||
Translation adjustment | -44 | -44 | ||||
Reclassification of convertible debt (to)/from mezzanine (Note E) | 58 | 58 | ||||
Net income | 3,093 | 2,889 | 204 | |||
Balance, December 31, 2012 at Dec. 31, 2013 | 23,786 | 20 | 1,406 | 21,114 | -239 | 1,485 |
Ending Balance (in shares) at Dec. 31, 2013 | 2,020 | 2,020 | ||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | ||||||
Stock issued through stock option and stock purchase plans | 33 | |||||
Stock issued through stock option and stock purchase plans | 503 | 0 | 503 | |||
Tax benefit from stock options exercised | 98 | 98 | ||||
Restricted stock grants, cancellations and withholdings, net | 10 | |||||
Restricted stock grants, cancellations and withholdings, net | -110 | 0 | -110 | |||
Repurchase of common stock | -107 | |||||
Repurchase of common stock | -3,000 | 0 | -2,333 | -667 | ||
Stock options issued in business acquisitions | 35 | 35 | ||||
Stock-based compensation | 1,055 | 1,055 | ||||
Cash dividends declared | -919 | 0 | -919 | 0 | ||
Impact from equity transactions of non-controlling interests | -690 | -654 | -36 | |||
Recognition of actuarial net gain (loss) from pension and other postretirement plans, net of taxes (benefits) of $(12), $20 and $(10) | -16 | -16 | ||||
Change in market value of investments | 18 | 18 | 0 | |||
Net change in the market value of derivatives | 6 | 6 | 0 | |||
Translation adjustment | -135 | -135 | ||||
Stock Issued During Period Shares Stock Conversion Of Convertible Securities And Warrants | 29 | |||||
Stock Issued During Period Value Stock Conversion Of Convertible Securities And Warrants | 0 | 0 | 0 | |||
Net income | 2,894 | 2,714 | 180 | |||
Balance, December 31, 2012 at Dec. 31, 2014 | $23,525 | $20 | $0 | $22,242 | ($366) | $1,629 |
Ending Balance (in shares) at Dec. 31, 2014 | 1,985 | 1,985 |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies | ||||||||
Company | |||||||||
EMC Corporation (“EMC”) and its subsidiaries develop, deliver and support the information technology (“IT”) industry’s broadest range of information infrastructure and virtual infrastructure technologies, solutions and services. EMC manages the Company as part of a federation of businesses: EMC Information Infrastructure, VMware Virtual Infrastructure and Pivotal. | |||||||||
EMC’s Information Infrastructure business provides a foundation for organizations to store, manage, protect, analyze and secure ever-increasing quantities of information, while at the same time improving business agility, lowering cost, and enhancing competitive advantage. EMC’s Information Infrastructure business comprises three segments – Information Storage, Enterprise Content Division, formerly known as Information Intelligence Group, and RSA Information Security. | |||||||||
EMC’s VMware Virtual Infrastructure business, which is represented by EMC’s majority equity stake in VMware, Inc. (“VMware”), is the leader in virtualization infrastructure solutions utilized by organizations to help them transform the way they build, deliver and consume IT resources. VMware’s virtualization infrastructure solutions, which include a suite of products and services designed to deliver a software-defined data center, run on industry-standard desktop computers and servers and support a wide range of operating system and application environments, as well as networking and storage infrastructures. | |||||||||
EMC’s Pivotal business (“Pivotal”) unites strategic technology, people and programs from EMC and VMware and has built a new platform comprising of next-generation data, agile development practices and a cloud independent platform-as-a-service (“PaaS”). These capabilities are made available through Pivotal’s three primary offerings: the Pivotal Big Data Suite, Pivotal Labs and Pivotal Cloud Foundry. | |||||||||
Accounting Principles | |||||||||
The financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). | |||||||||
Principles of Consolidation | |||||||||
These consolidated financial statements include the accounts of EMC, its wholly-owned subsidiaries, and Pivotal and VMware, companies which are majority-owned by EMC. All intercompany transactions have been eliminated. | |||||||||
EMC’s interest in VMware was approximately 80% at both December 31, 2014 and 2013. VMware’s financial results have been consolidated with that of EMC for all periods presented as EMC is VMware’s controlling stockholder. The portion of the results of operations of VMware allocable to its other owners is shown as net income attributable to the non-controlling interest in VMware, Inc. on EMC’s consolidated income statements. Additionally, the cumulative portion of the results of operations of VMware allocable to its other owners, along with the interest in the net assets of VMware attributable to those other owners, is shown as a component of non-controlling interests on EMC’s consolidated balance sheets and as a reduction of net income attributable to EMC shareholders. | |||||||||
EMC’s economic interest in Pivotal was approximately 84% at both December 31, 2014 and 2013. Pivotal’s financial results have been consolidated with that of EMC for all periods presented. The non-controlling interests’ share of equity in Pivotal is reflected as a component of the non-controlling interests in EMC’s consolidated balance sheets and as a reduction of net income attributable to EMC shareholders. Because the non-controlling interest in Pivotal is in the form of a preferred equity instrument, there is no net income attributable to non-controlling interest related to Pivotal on EMC’s consolidated income statements. | |||||||||
Use of Accounting Estimates | |||||||||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, the reported amounts of revenues and expenses during the reporting period and the disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates. | |||||||||
Revenue Recognition | |||||||||
We derive revenue from sales of systems, software licenses and services. We recognize revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable and collectability is reasonably assured. This policy is applicable to all sales, including sales to resellers and end users. Delivery is achieved when our product has been physically shipped or made available for use by electronic delivery and the risk of loss has been transferred which, for most of our product sales, occurs upon shipment. The following summarizes the major terms of our contractual relationships with our customers and the manner in which we account for sales transactions. | |||||||||
• | Product revenue | ||||||||
Product revenue consists of systems and software licenses sales that are delivered, sold as a subscription or sold on a consumption basis. System sales include storage hardware, required system software and other hardware-related devices. Software license sales include optional, stand-alone software applications. Our software applications provide customers with resource management, backup and archiving, information security, information management and intelligence, data analytics and server virtualization capabilities. Depending on the nature of the arrangement, revenue for system and software license sales is generally recognized upon shipment, electronic delivery. For certain arrangements, revenue is recognized based on usage or ratably over the term of the arrangement. License revenue from royalty arrangements is recognized upon either receipt of royalty reports or payments from third parties. | |||||||||
• | Services revenue | ||||||||
Services revenue consists of installation services, professional services, software maintenance, hardware maintenance, training and software sold as a service. | |||||||||
We recognize revenue from fixed-price support or maintenance contracts sold for both hardware and software, including extended warranty contracts, ratably over the contract period and recognize the costs associated with these contracts as incurred. Generally, installation and professional services are not considered essential to the functionality of our products as these services do not alter the product capabilities and may be performed by our customers or other vendors. Installation services revenues are recognized as the services are being performed. Professional services revenues on engagements for which reasonably dependable estimates of progress toward completion are capable of being made are recognized using the proportional performance method, which recognizes revenue based on labor costs incurred in proportion to total expected labor costs to perform the service. Where services are considered essential to the functionality of our products, revenue for the products and services is recorded over the service period. Professional services engagements that are sold on a time and materials basis are recognized based upon the labor costs incurred. Revenues from software sold as a service is recognized based on usage or ratably over the term of the service period depending upon the nature of the arrangement. Revenues on all other professional services engagements are recognized upon completion. | |||||||||
• | Multiple element arrangements | ||||||||
When more than one element, such as hardware, software and services are contained in a single arrangement, we first allocate revenue based upon the relative selling price into two categories: (1) non-software components, such as hardware and any hardware-related items, such as required system software that functions with the hardware to deliver the essential functionality of the hardware and related post-contract customer support, software as a service subscriptions and other services and (2) software components, such as optional software applications and related items, such as post-contract customer support and other services. We then allocate revenue within the non-software category to each element based upon their relative selling price using a hierarchy of vendor-specific objective evidence (“VSOE”), third-party evidence of selling price (“TPE”) or estimated selling prices (“ESP”), if VSOE or TPE does not exist. We allocate revenue within the software category to the undelivered elements based upon their fair value using VSOE with the residual revenue allocated to the delivered elements. If we cannot objectively determine the VSOE of the fair value of any undelivered software element, we defer revenue for all software components until all elements are delivered and services have been performed, until fair value can objectively be determined for any remaining undelivered elements, or until software maintenance is the only undelivered element in which case revenue is recognized over the maintenance term for all software elements. | |||||||||
We allocate the amount of revenue recognition for delivered elements to the amount that is not subject to forfeiture or refund or contingent on the future delivery of products or services. | |||||||||
Customers under software maintenance agreements are entitled to receive updates and upgrades on a when-and-if-available basis, and various types of technical support based on the level of support purchased. In the event specific features, functionality, entitlements, or the release version of an upgrade or new product have been announced but not delivered, and customers will receive that upgrade or new product as part of a current software maintenance contract, a specified upgrade is deemed created and product revenues are deferred on purchases made after the announcement date until delivery of the upgrade or new product. The amount and elements to be deferred are dependent on whether we have established VSOE of fair value for the upgrade or new product. | |||||||||
• | Indirect channel sales | ||||||||
We market and sell our products through our direct sales force and indirect channels such as independent distributors and value-added resellers. For substantially all of our indirect sales, we recognize revenues on products sold to resellers and distributors on a sell through basis. These product sales are evidenced by a master distribution agreement, together with evidence of an end-user arrangement, on a transaction-by-transaction basis. | |||||||||
We offer rebates to certain channel partners. We generally recognize the amount of the rebates as a reduction of revenues when the underlying revenue is recognized. We also offer marketing development funds to certain channel partners. We generally record the amount of the marketing development funds, based on the maximum potential liability, as a marketing expense as the funds are earned by the channel partners. | |||||||||
• | Shipping terms | ||||||||
Our sales contracts generally provide for the customer to accept risk of loss when the product leaves our facilities. When shipping terms or local laws do not allow for passage of risk of loss at shipping point, we defer recognizing revenue until risk of loss transfers to the customer. | |||||||||
• | Leases | ||||||||
Revenue from sales-type leases is recognized at the net present value of future lease payments. Revenue from operating leases is recognized over the lease period. | |||||||||
• | Other | ||||||||
We accrue for the estimated costs of systems’ warranty at the time of sale. We reduce revenue for estimated sales returns at the time of sale. Systems’ warranty costs are estimated based upon our historical experience and specific identification of systems’ requirements. Sales returns are estimated based upon our historical experience and specific identification of probable returns. | |||||||||
Deferred Revenue | |||||||||
Our deferred revenue consists primarily of deferred hardware and software maintenance and unearned license fees, which are recognized ratably over the contract term as either product or services revenue depending on the nature of the item, and deferred professional services, including education and training, which are recognized in services revenue as the services are provided. | |||||||||
Shipping and Handling Costs | |||||||||
Shipping and handling costs are classified in cost of product sales. | |||||||||
Foreign Currency Translation | |||||||||
The local currency is the functional currency of the majority of our subsidiaries. Assets and liabilities are translated into U.S. dollars at exchange rates in effect at the balance sheet date. Income and expense items are translated at daily rates. | |||||||||
Gains and losses from foreign currency transactions are included in other expense, net, and consist of net losses of $30 million , $2 million and $16 million in 2014, 2013 and 2012, respectively. Foreign currency translation adjustments are included in other comprehensive income (loss). | |||||||||
Derivatives | |||||||||
We use derivatives to hedge foreign currency exposures related to foreign currency denominated assets and liabilities and forecasted revenue and expense transactions. | |||||||||
We hedge our exposure in foreign currency denominated monetary assets and liabilities with foreign currency forward and option contracts. Since these derivatives hedge existing exposures that are denominated in foreign currencies, the contracts do not qualify for hedge accounting. Accordingly, these outstanding non-designated derivatives are recognized on the consolidated balance sheet at fair value and the changes in fair value from these contracts are recorded in other expense, net, in the consolidated income statements. These derivative contracts mature in less than one year. | |||||||||
We also use foreign currency forward and option contracts to hedge our exposure on a portion of our forecasted revenue and expense transactions. These derivatives are designated as cash flow hedges. We did not have any derivatives designated as fair value hedges as of December 31, 2014. All outstanding cash flow hedges are recognized on the consolidated balance sheets at fair value with changes in their fair value recorded in accumulated other comprehensive income (loss) until the underlying forecasted transactions occur. To achieve hedge accounting, certain criteria must be met, which includes (i) ensuring at the inception of the hedge that formal documentation exists for both the hedging relationship and the entity’s risk management objective and strategy for undertaking the hedge, and (ii) at the inception of the hedge and on an ongoing basis, the hedging relationship is expected to be highly effective in achieving offsetting changes in fair value attributed to the hedged risk during the period that the hedge is designated. Further, an assessment of effectiveness is required at a minimum on a quarterly basis. Absent meeting these criteria, changes in fair value are recognized currently in other expense, net, in the consolidated income statements. Once the underlying forecasted transaction occurs, the gain or loss from the derivative designated as a hedge of the transaction is reclassified from accumulated other comprehensive income (loss) to the consolidated income statements, in the related revenue or expense caption, as appropriate. In the event the underlying forecasted transaction does not occur, the amount recorded in accumulated other comprehensive income (loss) will be reclassified to other income (expense), net, in the consolidated income statements in the then-current period. Any ineffective portion of the derivatives designated as cash flow hedges is recognized in current earnings. The ineffective portion of the derivatives includes gains or losses associated with differences between actual and forecasted amounts. Our cash flow hedges generally mature within six months or less. The notional amount of cash flow hedges outstanding as of December 31, 2014, 2013 and 2012 were $245 million, $384 million and $201 million, respectively. | |||||||||
We do not engage in currency speculation. For purposes of presentation within the consolidated statement of cash flows, derivative gains and losses are presented within net cash provided by operating activities. | |||||||||
Our derivatives and their related activities are not material to our consolidated balance sheets or consolidated income statements. | |||||||||
Cash and Cash Equivalents | |||||||||
Cash and cash equivalents include highly liquid investments with a maturity of ninety days or less at the time of purchase. Cash equivalents consist primarily of money market securities, U.S. Treasury bills, U.S. Agency discount notes and commercial paper. Cash equivalents are stated at fair value. See Note F. | |||||||||
Allowance for Doubtful Accounts | |||||||||
We maintain an allowance for doubtful accounts for the estimated probable losses on uncollectible accounts and notes receivable. The allowance is based upon the creditworthiness of our customers, our historical experience, the age of the receivable and current market and economic conditions. Uncollectible amounts are charged against the allowance account. The allowance for doubtful accounts is maintained against both our current and non-current accounts and notes receivable balances. The balances in the allowance accounts at December 31, 2014 and 2013 were as follows (table in millions): | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Current | $ | 72 | $ | 62 | |||||
Non-current (included in other assets, net) | 2 | 3 | |||||||
$ | 74 | $ | 65 | ||||||
Investments | |||||||||
Unrealized gains and temporary loss positions on investments classified as available-for-sale are included within accumulated other comprehensive income (loss), net of any related tax effect. Upon realization, those amounts are reclassified from accumulated other comprehensive income (loss) to investment income. Realized gains and losses and other-than-temporary impairments are reflected in the consolidated income statement in investment income. For investments accounted for utilizing the fair value option, changes to fair value are recognized in the consolidated income statement in non-operating income (expense), net. | |||||||||
Inventories | |||||||||
Inventories are stated at the lower of cost (first-in, first-out) or market, not in excess of net realizable value. | |||||||||
Property, Plant and Equipment | |||||||||
Property, plant and equipment are recorded at cost. Buildings under development are included in building construction in progress. Depreciation commences upon placing the asset in service and is recognized on a straight-line basis over the estimated useful lives of the assets, as follows: | |||||||||
Furniture and fixtures | 5-10 years | ||||||||
Equipment and software | 2-10 years | ||||||||
Improvements | 5-31 years | ||||||||
Buildings | 15-51 years | ||||||||
Upon retirement or disposition, the asset cost and related accumulated depreciation are removed with any gain or loss recognized in the consolidated income statements. Repair and maintenance costs, including planned maintenance, are expensed as incurred. | |||||||||
Research and Development and Capitalized Software Development Costs | |||||||||
Research and development (“R&D”) costs are expensed as incurred. R&D costs include salaries and benefits, stock-based compensation, consultants, facilities related costs, material costs, depreciation and travel. Material software development costs incurred subsequent to establishing technological feasibility through the general release of the software products are capitalized. Technological feasibility is demonstrated by the completion of a detailed program design or working model, if no program design is completed. GAAP requires that annual amortization expense of the capitalized software development costs be the greater of the amounts computed using the ratio of gross revenue to a products’ total current and anticipated revenues, or the straight-line method over the products’ remaining estimated economic life. Capitalized costs are amortized over periods ranging from eighteen months to two years which represents the products’ estimated economic life. | |||||||||
Unamortized software development costs were $829 million and $762 million at December 31, 2014 and 2013, respectively, and are included in other assets, net. Amortization expense was $482 million, $427 million and $398 million in 2014, 2013 and 2012, respectively. Amounts capitalized were $549 million, $487 million and $432 million in 2014, 2013 and 2012, respectively. The amounts capitalized include stock-based compensation which is not reflected in the consolidated statements of cash flows as it is a non-cash item. | |||||||||
Long-lived Assets | |||||||||
Purchased intangible assets, other than goodwill, are amortized over their estimated useful lives which range from one to eighteen years. Intangible assets include goodwill, purchased technology, trademarks and tradenames, customer relationships and customer lists, software licenses, patents, leasehold interest and other intangible assets, which include backlog, non-competition agreements and non-solicitation agreements. Most of our intangible assets are amortized based upon the pattern in which the economic benefits of the intangible assets are being utilized; the remainder are amortized on a straight-line basis. Goodwill is not amortized and is carried at its historical cost. | |||||||||
We periodically review our long-lived assets for impairment. We initiate reviews for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. Each impairment test, other than goodwill, is based on a comparison of the un-discounted cash flows to the recorded value of the asset. If an impairment is indicated, the asset is written down to its estimated fair value. | |||||||||
We test goodwill for impairment in the fourth quarter of each year or more frequently if events or changes in circumstances indicate that the asset might be impaired. The test is based on a comparison of the reporting unit’s book value to its estimated fair market value. We perform both qualitative and quantitative tests of our goodwill. | |||||||||
Investments in Joint Ventures | |||||||||
We make investments in joint ventures. For each joint venture investment we consider the facts and circumstances in order to determine whether it qualifies for cost, equity or fair value method accounting or whether it should be consolidated. | |||||||||
In 2009, Cisco and EMC formed VCE Company LLC (“VCE”), with investments from VMware and Intel. VCE, through Vblock infrastructure platforms, delivers an integrated IT offering that combines network, computing, storage, management, security and virtualization technologies for converged infrastructures and cloud based computing models. | |||||||||
In December 2014, EMC acquired the controlling interest in VCE. Prior to the acquisition of the controlling interest in VCE, we considered VCE a variable interest entity. Authoritative guidance related to variable interest entities states that the primary beneficiary of a variable interest entity must have both of the following characteristics: (a) the power to direct the activities of a variable interest entity that most significantly will impact the entity’s economic performance; and (b) the obligation to absorb losses that could be potentially significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity. Since the power to direct the activities of VCE which most significantly impact its economic performance was determined by its board of directors, which was comprised of equal representation of EMC and Cisco, and all significant decisions required the approval of the minority shareholders, we determined that prior to acquiring the controlling interest, we were not the primary beneficiary, and as such we accounted for the investment under the equity method with our portion of the gains and losses recognized in other expense, net in the consolidated income statements for the majority of 2014, and all of 2013 and 2012. Since the date of acquiring the controlling interest in VCE, we have consolidated VCE’s financial position and results as part of EMC’s consolidated financial statements. | |||||||||
Advertising | |||||||||
Advertising costs are expensed as incurred. Advertising expense was $25 million, $23 million and $30 million in 2014, 2013 and 2012, respectively. | |||||||||
Legal Costs | |||||||||
Legal costs incurred in connection with loss contingencies are recognized when the costs are probable of occurrence and can be reasonably estimated. | |||||||||
Income Taxes | |||||||||
Deferred tax liabilities and assets are recognized for the expected future tax consequences of events that have been included in the financial statements or tax returns. Deferred tax liabilities and assets are determined based on the difference between the tax basis of assets and liabilities and their reported amounts using enacted tax rates in effect for the year in which the differences are expected to reverse. Tax credits are generally recognized as reductions of income tax provisions in the year in which the credits arise. The measurement of deferred tax assets is reduced by a valuation allowance if, based upon available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. | |||||||||
Accounting for uncertainty in income taxes recognized in the financial statements is in accordance with accounting authoritative guidance, which prescribes a two-step process to determine the amount of tax benefit to be recognized. First, the tax position must be evaluated to determine the likelihood that it will be sustained upon external examination. If the tax position is deemed “more-likely-than-not” to be sustained, the tax position is then assessed to determine the amount of benefit to recognize in the financial statements. The amount of the benefit that may be recognized is the largest amount that has a greater than 50 percent likelihood of being realized upon ultimate settlement. | |||||||||
We do not provide for a U.S. income tax liability on undistributed earnings of our foreign subsidiaries. The earnings of non-U.S. subsidiaries, which reflect full provision for non-U.S. income taxes, are currently indefinitely reinvested in non-U.S. operations or are expected to be remitted substantially free of additional tax. | |||||||||
Sales Taxes | |||||||||
Sales and other taxes collected from customers and subsequently remitted to government authorities are recorded as cash or accounts receivable with a corresponding offset recorded to sales taxes payable. These balances are removed from the consolidated balance sheet as cash is collected from the customers and remitted to the tax authority. | |||||||||
Earnings Per Share | |||||||||
Basic net income per share is computed using the weighted-average number of shares of our common stock outstanding during the period. Diluted net income per share is computed using the weighted-average number of common and dilutive common equivalent shares outstanding during the period. Common equivalent shares consist of stock options, unvested restricted stock and restricted stock units, the shares issuable under our $1.725 billion 1.75% convertible senior notes due 2013 (the “2013 Notes”) and the associated warrants. See Note E for further information regarding the 2013 Notes and the associated warrants and Note O for further information regarding the calculation of diluted net income per weighted-average share. Additionally, for purposes of calculating diluted net income per common share, net income is adjusted for the difference between VMware’s reported diluted and basic earnings per share, if any, multiplied by the number of shares of VMware held by EMC. | |||||||||
Retirement Benefits | |||||||||
Pension cost for our domestic defined benefit pension plan is funded to the extent that the current pension cost is deductible for U.S. Federal tax purposes and to comply with the Employee Retirement Income Security Act and the General Agreement on Tariff and Trade Bureau additional minimum funding requirements. Net pension cost for our international defined benefit pension plans are generally funded as accrued. | |||||||||
Concentrations of Risks | |||||||||
Financial instruments that potentially subject us to concentration of credit risk consist principally of bank deposits, money market investments, short- and long-term investments, accounts and notes receivable, and foreign currency exchange contracts. Deposits held with banks in the United States may exceed the amount of FDIC insurance provided on such deposits. Deposits held with banks outside the United States generally do not benefit from FDIC insurance. The majority of our day-to-day banking operations globally are maintained with Citibank. We believe that Citibank’s position as a primary clearing bank, coupled with the substantial monitoring of their daily liquidity, both by their internal processes and by the Federal Reserve and the FDIC, mitigate some of our risk. | |||||||||
Our money market investments are placed with money market funds that are 2a-7 qualified. Rule 2a-7, adopted by the United States Securities and Exchange Commission (the “SEC”) under the Investment Company Act of 1940, establishes strict standards for quality, diversity and maturity, the objective of which is to maintain a constant net asset value of a dollar. We limit our investments in money market funds to those that are primarily associated with large, money center financial institutions and limit our exposure to Prime funds. Our short- and long-term investments are invested primarily in investment grade securities, and we limit the amount of our investment in any single issuer. | |||||||||
We provide credit to customers in the normal course of business. Credit is extended to new customers based on checks of credit references, credit scores and industry reputation. Credit is extended to existing customers based on prior payment history and demonstrated financial stability. The credit risk associated with accounts and notes receivables is generally limited due to the large number of customers and their broad dispersion over many different industries and geographic areas. We establish an allowance for the estimated uncollectible portion of our accounts and notes receivable. We customarily sell the notes receivable we derive from our leasing activity. Generally, we do not retain any recourse on the sale of these notes. Our sales are generally dispersed among a large number of customers, minimizing the reliance on any particular customer or group of customers. | |||||||||
The counterparties to our foreign currency exchange contracts consist of a number of major financial institutions. In addition to limiting the amount of contracts we enter into with any one party, we monitor the credit quality of the counterparties on an ongoing basis. | |||||||||
We purchase or license many sophisticated components and products from one or a limited number of qualified suppliers. If any of our suppliers were to cancel or materially change contracts or commitments with us or fail to meet the quality or delivery requirements needed to satisfy customer orders for our products, we could lose customer orders. We attempt to minimize this risk by finding alternative suppliers or maintaining adequate inventory levels to meet our forecasted needs. | |||||||||
Accounting for Stock-Based Compensation | |||||||||
We have selected the Black-Scholes option-pricing model to determine the fair value of our stock option awards. For stock options, restricted stock and restricted stock units, we recognize compensation cost on a straight-line basis over the awards’ vesting periods for those awards which contain only a service vesting feature. For awards with a performance condition vesting feature, when achievement of the performance condition is deemed probable, we recognize compensation cost on a graded-vesting basis over the awards’ expected vesting periods. | |||||||||
Reclassifications | |||||||||
Certain prior year amounts have been reclassified to conform with the current year’s presentation. During the first quarter of 2014, the Information Storage segment acquired the Data Computing Appliance and implementation services businesses from the Pivotal segment. The acquisition of these businesses was accounted for as a business combination between entities under common control. We reflected the impact of the transaction in our segment disclosures and included the financial results of the acquired businesses in the Information Storage segment and excluded these from the Pivotal segment for the years ended December 31, 2014 and 2013. None of the segment reclassifications impact EMC’s previously reported consolidated financial statements. See Note S for further discussion of the segment reclassifications. | |||||||||
Recent Accounting Pronouncements | |||||||||
In May 2014, the Financial Accounting Standards Board (“FASB”) issued a standard on revenue recognition providing a single, comprehensive revenue recognition model for all contracts with customers. The revenue standard is based on the principle that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard is effective beginning January 1, 2017, with no early adoption permitted. The principles may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of initial application. We are currently evaluating the adoption method options and the impact of the new guidance on our consolidated financial statements. | |||||||||
New Accounting Guidance Recently Adopted | |||||||||
In April 2014, the FASB issued new accounting guidance on reporting discontinued operations and disclosures of disposals of components of an entity which clarifies the scope of what should be reported as discontinued operations and expands required disclosures. | |||||||||
In July 2013, the FASB issued new accounting guidance on the presentation of unrecognized tax benefits. This new guidance requires an entity to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, as a reduction to a deferred tax asset when a net operating loss carryforward, a similar tax loss or a tax credit carryforward exists, with limited exceptions. | |||||||||
In March 2013, the FASB issued new accounting guidance that requires a parent company to release any related cumulative translation adjustment into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. | |||||||||
The adoption of the new accounting guidance discussed above during 2014 did not have a material impact on our consolidated financial statements. |
Noncontrolling_Interests
Non-controlling Interests | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Noncontrolling Interest [Abstract] | ||||||||
Non-controlling Interests | Non-controlling Interests | |||||||
The non-controlling interests’ share of equity in VMware is reflected as a component of the non-controlling interests in the accompanying consolidated balance sheets and was $1,524 million and $1,380 million as of December 31, 2014 and 2013, respectively. At December 31, 2014, EMC held approximately 97% of the combined voting power of VMware’s outstanding common stock and approximately 80% of the economic interest in VMware. | ||||||||
The effect of changes in our ownership interest in VMware on our equity was as follows (table in millions): | ||||||||
For the Year Ended | ||||||||
December 31, | December 31, | |||||||
2014 | 2013 | |||||||
Net income attributable to EMC Corporation | $ | 2,714 | $ | 2,889 | ||||
Transfers (to) from the non-controlling interest in VMware, Inc.: | ||||||||
Increase in EMC Corporation’s additional paid-in-capital for VMware’s equity issuances | 87 | 92 | ||||||
Decrease in EMC Corporation’s additional paid-in-capital for VMware’s other equity activity | (741 | ) | (565 | ) | ||||
Net transfers (to) from non-controlling interest | (654 | ) | (473 | ) | ||||
Change from net income attributable to EMC Corporation and transfers from the non-controlling interest in VMware, Inc. | $ | 2,060 | $ | 2,416 | ||||
The non-controlling interests’ share of equity in Pivotal is reflected as a component of the non-controlling interests in the accompanying consolidated balance sheets as $105 million at both December 31, 2014 and 2013. At December 31, 2014, EMC consolidated held approximately 84% of the economic interest in Pivotal. GE’s interest in Pivotal is in the form of a preferred equity instrument. Consequently, there is no net income attributable to non-controlling interest related to Pivotal on the consolidated income statements. Additionally, due to the terms of the preferred instrument, GE’s non-controlling interest on the consolidated balance sheets is generally not impacted by Pivotal’s equity related activity. The preferred equity instrument is convertible into common shares at GE’s election at any time. |
Acquisitions
Acquisitions | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Business Combinations [Abstract] | ||||
Acquisitions | Acquisitions | |||
2014 Acquisitions | ||||
Acquisition of AirWatch | ||||
On February 24, 2014, VMware acquired all of the outstanding capital stock of A.W.S. Holding, LLC (“AirWatch Holding”), the sole member and equity holder of AirWatch LLC (“AirWatch”). AirWatch is a leader in enterprise mobile management and security solutions. VMware acquired AirWatch to expand its solutions within the enterprise mobile and security space. The aggregate consideration paid for AirWatch was $1,128 million, net of cash acquired, including cash of $1,104 million and the fair value of assumed unvested equity attributed to pre-combination services totaling $24 million. | ||||
Merger consideration totaling $300 million is payable to certain employees of AirWatch subject to specified future employment conditions and will be recognized as expense over the requisite service period. Compensation expense totaling $141 million was recognized from the date of acquisition through December 31, 2014. | ||||
The following table summarizes the allocation of the consideration to the fair value of the assets acquired and net liabilities assumed, net of cash acquired (table in millions): | ||||
Other current assets | $ | 61 | ||
Intangible assets: | ||||
Purchased technology (weighted-average useful life of 6 years) | 118 | |||
Customer relationships and customer lists (weighted-average useful life of 8 years) | 78 | |||
Trademarks and tradenames (weighted-average useful life of 8 years) | 40 | |||
Other (weighted-average useful life of 3 years) | 14 | |||
Total intangible assets, net, excluding goodwill | 250 | |||
Goodwill | 868 | |||
Other assets | 30 | |||
Total assets acquired | 1,209 | |||
Unearned revenue | (45 | ) | ||
Other assumed liabilities, net of acquired assets | (72 | ) | ||
Total net liabilities assumed | (117 | ) | ||
Fair value of assets acquired and net liabilities assumed | $ | 1,092 | ||
These VMware intangible assets are being amortized on a straight-line basis. Goodwill is calculated as the excess of the consideration over the fair value of the net assets, including intangible assets, recognized and primarily related to expected synergies from the transaction. The majority of the goodwill and identifiable intangible assets are expected to be deductible for U.S. federal income tax purposes. The results of this acquisition have been included in the consolidated financial statements from the date of purchase. Pro forma results of operations have not been presented as the results of the acquired company were not material to our consolidated results of operations for the year ended 2014 or 2013. | ||||
Other 2014 Acquisitions | ||||
During the year ended December 31, 2014, EMC acquired seven businesses which were not material either individually or in the aggregate to our 2014 results. Complementing the Information Storage segment, we acquired the controlling interest in VCE, a joint venture with Cisco, which delivers through Vblock infrastructure platforms an integrated IT offering that combines network, computing, storage, management, security and virtualization technologies for converged infrastructures and cloud based computing models; all of the outstanding capital stock of DSSD, Inc., a developer of an innovative new rack-scale flash storage architecture for I/O-intensive in-memory databases and Big Data workloads; and TwinStrata, Inc., a provider of advanced tiering cloud technology. We also acquired all of the outstanding capital stock of The Cloudscaling Group, Inc., a leading provider of OpenStack Powered Infrastructure-as-a-Service (“IaaS”) for private and hybrid cloud solutions; Maginatics, Inc., a cloud technology provider offering a highly consistent global namespace accessible from any device or location; and Spanning Cloud Apps, Inc., a leading provider of subscription-based backup and recovery for cloud based applications and data. | ||||
Complementing our RSA Information Security segment, we acquired Symplified, Inc., a provider of a comprehensive cloud identity solution that helps service-oriented IT organizations simplify user access, regain visibility and control over application usage and meet security and compliance requirements. | ||||
In addition to the acquisition of AirWatch, during the year ended December 31, 2014, VMware completed three business combinations which were not material either individually or in the aggregate. VMware acquired all of the outstanding common stock of CloudVolumes, Inc., a provider of real-time application delivery technology that enables enterprises to deliver native applications to virtualized environments on-demand. Additionally, in the fourth quarter of 2014, VMware completed two other immaterial business combinations. | ||||
The aggregate consideration for these ten acquisitions, excluding AirWatch, was $1,515 million, which consisted of $1,404 million of cash consideration, net of cash acquired and $10 million for the fair value of assumed unvested equity attributed to pre-combination services. In connection with these acquisitions, we recognized a $101 million gain on previously held interests in strategic investments and joint ventures which was recognized in other expense, net in the consolidated income statements in 2014. The consideration was allocated to the fair value of the assets acquired and liabilities assumed based on estimated fair values as of the respective acquisition dates. The aggregate allocation to goodwill, intangibles, and net liabilities was approximately $847 million, $484 million and $184 million, respectively. | ||||
The fair value of our stock options for all of the aforementioned acquisitions, excluding AirWatch, in 2014 was estimated using the following weighted-average assumptions: | ||||
Expected term (in years) | 2.6 | |||
Expected volatility | 27.3 | % | ||
Risk-free interest rate | 0.7 | % | ||
Dividend yield | 1.7 | % | ||
The following represents the aggregate allocation of the purchase price for all of the aforementioned acquisitions, excluding AirWatch, to intangible assets (table in millions): | ||||
Purchased technology (weighted-average useful life of 6 years) | $ | 460 | ||
Customer relationships (weighted-average useful life of 5 years) | 10 | |||
Trademarks and tradenames (weighted-average useful life of 4 years) | 14 | |||
Total intangible assets | $ | 484 | ||
The total weighted-average amortization period for the intangible assets is 6 years. Most of our intangible assets are being amortized based upon the pattern in which the economic benefits of the intangible assets are being utilized; the remainder are amortized on a straight-line basis. Goodwill is calculated as the excess of the consideration over the fair value of the net assets, including intangible assets, and is primarily related to expected synergies from the transaction. The goodwill is not deductible for U.S. federal income tax purposes. The results of these acquisitions have been included in the consolidated financial statements from the date of purchase. Pro forma results of operations have not been presented as the results of the acquired companies were not material to our consolidated results of operations for the year ended December 31, 2014 or 2013. | ||||
2013 Acquisitions | ||||
During the year ended December 31, 2013, EMC acquired five businesses. Complementing the Information Storage segment, we acquired substantially all of the assets of Adaptivity, Inc., a provider of software solutions that automate and accelerate enterprise IT migration to the cloud and all of the outstanding capital stock of ScaleIO, a provider of server-side storage software. A member of our board of directors is an investor in a limited partnership which held an equity interest in ScaleIO. The director did not participate in any votes of the board of directors or any committee thereof approving the acquisition, and the terms of the acquisition were negotiated at arms’ length. | ||||
Complementing the Enterprise Content Division segment, we also acquired all of the outstanding capital stock of Sitrof Technologies, a document management consultancy provider. Complementing the RSA Information Security segment, we acquired all of the outstanding common stock of Aveksa, Inc., a provider of cloud-based identity and access management solutions and PassBan Corporation, a developer of mobile and cloud-based multi-factor authentication technology. Complementing the Pivotal segment, Pivotal acquired all of the outstanding common stock of Xtreme Labs, a provider of mobile strategy and product development during the year ended December 31, 2013. | ||||
Additionally, during the year ended December 31, 2013, VMware acquired all of the outstanding common stock of two companies, which were not material either individually or in the aggregate, including Virsto Software, a provider of software that optimizes storage performance and utilization in virtual environments and Desktone, Inc., a provider of desktop-as-a-service for delivering Windows desktops and applications as a cloud service. | ||||
The aggregate consideration for these eight acquisitions was $771 million, which consisted of $770 million of cash consideration, net of cash acquired, and $1 million for the fair value of our stock options granted in exchange for the acquirees’ stock options. The consideration paid was allocated to the fair value of the assets acquired and liabilities assumed based on estimated fair values as of the respective acquisition dates. The aggregate allocation to goodwill, intangibles and net liabilities was approximately $596 million, $182 million and $8 million, respectively. The results of these acquisitions have been included in the consolidated financial statements from the date of purchase. | ||||
The fair value of our stock options for all of the aforementioned acquisitions in 2013 was estimated using the following weighted-average assumptions: | ||||
Expected term (in years) | 1.8 | |||
Expected volatility | 26.4 | % | ||
Risk-free interest rate | 0.3 | % | ||
Dividend yield | 1.5 | % | ||
The following represents the aggregate allocation of the purchase price for all of the aforementioned acquisitions to intangible assets (table in millions): | ||||
Developed technology (weighted-average useful life of 5 years) | $ | 138 | ||
Customer relationships (weighted-average useful life of 4 years) | 34 | |||
In-process research and development | 10 | |||
Total intangible assets | $ | 182 | ||
The total weighted-average amortization period for the intangible assets is 4 years. Most of our intangible assets are being amortized based upon the pattern in which the economic benefits of the intangible assets are estimated to be utilized and the remainder are amortized on a straight-line basis. | ||||
2012 Acquisitions | ||||
Acquisition of Nicira | ||||
On August 24, 2012, VMware acquired all of the outstanding capital stock of Nicira, a developer of software-defined networking solutions. This acquisition expanded VMware’s product portfolio to provide a suite of software-defined networking capabilities. The aggregate consideration paid for Nicira was $1,100 million, net of cash acquired, including cash of $1,083 million and the fair value of assumed equity attributed to pre-combination services of $17 million. Additionally, VMware assumed all of Nicira’s unvested stock options and restricted stock outstanding at the completion of the acquisition. The assumed unvested stock options converted into 1 million stock options to purchase VMware Class A common stock. The assumed restricted stock converted into 1 million shares of restricted VMware Class A common stock. The fair value of the restricted stock was based on the acquisition-date closing price of $92.21 per share for VMware’s Class A common stock. | ||||
The fair value of VMware’s stock options for the acquisition of Nicira was estimated using the following weighted-average assumptions: | ||||
Expected term (in years) | 2.7 | |||
Expected volatility | 35.7 | % | ||
Risk-free interest rate | 0.3 | % | ||
The purchase price was allocated to the assets acquired and the liabilities assumed based on estimated fair values as of the acquisition date. The following table summarizes the allocation of the Nicira purchase price (table in millions): | ||||
Intangible assets: | ||||
Purchased technology (weighted-average useful life of 7 years) | $ | 266 | ||
Trademarks and tradenames (weighted-average useful life of 10 years) | 20 | |||
In-process research and development | 49 | |||
Total intangible assets | 335 | |||
Goodwill | 893 | |||
Deferred tax liabilities, net | (77 | ) | ||
Income tax payable | (50 | ) | ||
Other assumed liabilities, net of acquired assets | (1 | ) | ||
Total purchase price | $ | 1,100 | ||
In-process Research and Development | ||||
In connection with the Nicira acquisition, we acquired one in-process research and development (“IPR&D”) project which was completed by the end of 2012 and is being amortized over its estimated useful life of 8 years. | ||||
Other 2012 Acquisitions | ||||
During the year ended December 31, 2012, EMC acquired eleven businesses. Complementing the Information Storage segment, we acquired all of the outstanding capital stock of Pivotal Labs, a provider of services and technology to build Big Data applications; Likewise Software, a provider of technology for managing cross-platform access to data files and software for managing unstructured data; XtremIO, a provider of Flash enterprise storage systems; Watch4Net, a provider of enterprise and carrier-class performance management software; Tiburon Technologies, a provider of support and modernization services for legacy database management systems; More VRP Resources, a provider of database performance and monitoring software; and iWave Software, a provider of storage and cloud automation software solutions. | ||||
Complementing our Enterprise Content Division, we acquired all of the outstanding capital stock of Syncplicity, a provider of cloud-based sync and share file management and Trinity Technologies, a provider of enterprise content management consulting and development services. Complementing our RSA Information Security segment, we acquired Silicium Security, a provider of enterprise malware detection solutions and Silver Tail Systems, a provider of web fraud detection. | ||||
Additionally, during the year ended December 31, 2012, VMware acquired five companies, in addition to the acquisition of Nicira, which were not material either individually or in the aggregate. In connection with these acquisitions, we recognized a $32 million gain on previously held interests in strategic investments which was recognized in other expense, net in the consolidated statements of income in 2012. | ||||
The aggregate consideration for these sixteen acquisitions, excluding Nicira, was $1,060 million which consisted of $1,053 million of cash consideration, net of cash acquired, and $7 million for the fair value of our stock options granted in exchange for the acquirees’ stock options. The consideration paid was allocated to the fair value of the assets acquired and liabilities assumed based on estimated fair values as of the respective acquisition dates. | ||||
The aggregate allocation to goodwill, intangibles and net liabilities, excluding Nicira, was approximately $819 million, $311 million and $70 million, respectively. The results of these acquisitions have been included in the consolidated financial statements from the date of purchase. | ||||
The fair value of our stock options for all of the aforementioned acquisitions, excluding Nicira, in 2012 was estimated assuming no expected dividends and the following weighted-average assumptions: | ||||
Expected term (in years) | 1.9 | |||
Expected volatility | 31.6 | % | ||
Risk-free interest rate | 0.3 | % | ||
The following represents the aggregate allocation of the purchase price for all of the aforementioned acquisitions, excluding Nicira, to intangible assets (table in millions): | ||||
Developed technology (weighted-average useful life of 5 years) | $ | 255 | ||
Customer relationships (weighted-average useful life of 6 years) | 54 | |||
Trademarks and tradenames (weighted-average useful life of 3 years) | 2 | |||
Total intangible assets | $ | 311 | ||
The total weighted-average amortization period for the intangible assets is 5 years. |
Intangibles_and_Goodwill
Intangibles and Goodwill | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||
Intangibles and Goodwill | Intangibles and Goodwill | |||||||||||||||||||||||
Intangible Assets | ||||||||||||||||||||||||
Intangible assets, excluding goodwill, as of December 31, 2014 and 2013 consist of (tables in millions): | ||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||
Gross Carrying | Accumulated | Net Book Value | ||||||||||||||||||||||
Amount | Amortization | |||||||||||||||||||||||
Purchased technology | $ | 2,935 | $ | (1,668 | ) | $ | 1,267 | |||||||||||||||||
Patents | 225 | (117 | ) | 108 | ||||||||||||||||||||
Software licenses | 108 | (93 | ) | 15 | ||||||||||||||||||||
Trademarks and tradenames | 226 | (136 | ) | 90 | ||||||||||||||||||||
Customer relationships and customer lists | 1,473 | (974 | ) | 499 | ||||||||||||||||||||
Leasehold interest | 152 | (16 | ) | 136 | ||||||||||||||||||||
Other | 44 | (34 | ) | 10 | ||||||||||||||||||||
Total intangible assets, excluding goodwill | $ | 5,163 | $ | (3,038 | ) | $ | 2,125 | |||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||
Gross Carrying | Accumulated | Net Book Value | ||||||||||||||||||||||
Amount | Amortization | |||||||||||||||||||||||
Purchased technology | $ | 2,356 | $ | (1,429 | ) | $ | 927 | |||||||||||||||||
Patents | 225 | (102 | ) | 123 | ||||||||||||||||||||
Software licenses | 101 | (90 | ) | 11 | ||||||||||||||||||||
Trademarks and tradenames | 171 | (118 | ) | 53 | ||||||||||||||||||||
Customer relationships and customer lists | 1,386 | (855 | ) | 531 | ||||||||||||||||||||
Leasehold interest | 145 | (11 | ) | 134 | ||||||||||||||||||||
Other | 28 | (27 | ) | 1 | ||||||||||||||||||||
Total intangible assets, excluding goodwill | $ | 4,412 | $ | (2,632 | ) | $ | 1,780 | |||||||||||||||||
Amortization expense on intangibles was $402 million, $389 million and $365 million in 2014, 2013 and 2012, respectively. As of December 31, 2014, amortization expense on intangible assets for the next five years is expected to be as follows (table in millions): | ||||||||||||||||||||||||
2015 | $ | 390 | ||||||||||||||||||||||
2016 | 336 | |||||||||||||||||||||||
2017 | 309 | |||||||||||||||||||||||
2018 | 290 | |||||||||||||||||||||||
2019 | 241 | |||||||||||||||||||||||
Total | $ | 1,566 | ||||||||||||||||||||||
Goodwill | ||||||||||||||||||||||||
Changes in the carrying amount of goodwill, net, on a consolidated basis and by segment, for the year ended December 31, 2014 consists of the following (table in millions): | ||||||||||||||||||||||||
Year Ended December 31, 2014 | ||||||||||||||||||||||||
Information | Enterprise | RSA | Pivotal | VMware | Total | |||||||||||||||||||
Storage | Content | Information | Virtual | |||||||||||||||||||||
Division | Security | Infrastructure | ||||||||||||||||||||||
Balance, beginning of the year | $ | 7,486 | $ | 1,487 | $ | 2,203 | $ | 177 | $ | 3,071 | $ | 14,424 | ||||||||||||
Goodwill resulting from acquisitions | 774 | — | — | — | 941 | 1,715 | ||||||||||||||||||
Finalization of purchase price allocations and other, net | — | (1 | ) | — | — | (4 | ) | (5 | ) | |||||||||||||||
Goodwill transferred in acquisition of Pivotal businesses | 6 | — | — | (6 | ) | — | — | |||||||||||||||||
Balance, end of the year | $ | 8,266 | $ | 1,486 | $ | 2,203 | $ | 171 | $ | 4,008 | $ | 16,134 | ||||||||||||
The transfer of goodwill pursuant to the Information Storage segment acquisition of the Data Computing Appliance and implementation services businesses from the Pivotal segment is shown above for the year ended December 31, 2014. The amount of transferred goodwill was determined using the relative fair value method. See Note S for further discussion of the segment disclosures. | ||||||||||||||||||||||||
Changes in the carrying amount of goodwill, net, on a consolidated basis and by segment, for the year ended December 31, 2013 consists of the following (table in millions): | ||||||||||||||||||||||||
Year Ended December 31, 2013 | ||||||||||||||||||||||||
Information | Enterprise | RSA | Pivotal | VMware | Total | |||||||||||||||||||
Storage | Content | Information | Virtual | |||||||||||||||||||||
Division | Security | Infrastructure | ||||||||||||||||||||||
Balance, beginning of the year | $ | 7,442 | $ | 1,484 | $ | 2,022 | $ | — | $ | 2,892 | $ | 13,840 | ||||||||||||
Goodwill resulting from acquisitions | 145 | 1 | 181 | 37 | 233 | 597 | ||||||||||||||||||
Finalization of purchase price allocations and other, net | 11 | 2 | — | — | (26 | ) | (13 | ) | ||||||||||||||||
Goodwill transferred in formation of Pivotal | (112 | ) | — | — | 140 | (28 | ) | — | ||||||||||||||||
Balance, end of the year | $ | 7,486 | $ | 1,487 | $ | 2,203 | $ | 177 | $ | 3,071 | $ | 14,424 | ||||||||||||
EMC and VMware formed Pivotal, with an investment from GE, during 2013. As Pivotal is considered a separate reportable segment, the transfer of goodwill from the Information Storage and VMware Virtual Infrastructure segments to the newly formed Pivotal segment is shown above for 2013. The amount of transferred goodwill was determined using the relative fair value method. | ||||||||||||||||||||||||
Valuation of Goodwill and Intangibles | ||||||||||||||||||||||||
We perform an assessment of the recoverability of goodwill, at least annually, in the fourth quarter of each year. Our assessment is performed at the reporting unit level which, for certain of our operating segments, is one step below our reporting segment level. We employ both qualitative and quantitative tests of our goodwill. For some of our reporting units, we performed a qualitative assessment on goodwill to determine whether a quantitative assessment was necessary and determined there were no indicators of potential impairment. For other reporting units we evaluated goodwill using a quantitative model. For all of our goodwill assessments, we concluded that there was sufficient market value above the carrying value of those reporting units so that we would not expect any near term changes in the operating results that would trigger an impairment. Accordingly, there was no impairment in 2014, 2013 or 2012. | ||||||||||||||||||||||||
The determination of relevant comparable industry companies impacts our assessment of fair value. Should the operating performance of our reporting units change in comparison to these companies or should the valuation of these companies change, this could impact our assessment of the fair value of the reporting units. Our discounted cash flow analyses factor in assumptions on revenue and expense growth rates. These estimates are based upon our historical experience and projections of future activity, factoring in customer demand, changes in technology and a cost structure necessary to achieve the related revenues. Additionally, these discounted cash flow analyses factor in expected amounts of working capital and weighted average cost of capital. Changes in judgments on any of these factors could materially impact the value of the reporting unit. | ||||||||||||||||||||||||
Other intangible assets are evaluated based upon the expected period the asset will be utilized, forecasted cash flows, changes in technology and customer demand. Changes in judgments on any of these factors could materially impact the value of the assets. |
Debt
Debt | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Debt Disclosure [Abstract] | ||||||||
Convertible Debt | E. Debt | |||||||
Long-Term Debt | ||||||||
In June 2013, we issued $5.5 billion aggregate principal amount of senior notes (collectively, the “Notes”) which pay a fixed rate of interest semi-annually in arrears. The first interest payment occurred on December 2, 2013. The proceeds from the Notes have been used to satisfy the cash payment obligation of the converted 2013 Notes as well as for general corporate purposes including stock repurchases, dividend payments, business acquisitions, working capital needs and other business opportunities. The Notes of each series are senior, unsecured obligations of EMC and are not convertible or exchangeable. Unless previously purchased and canceled, we will repay the Notes of each series at 100% of the principal amount, together with accrued and unpaid interest thereon, at maturity. However, EMC has the right to redeem any or all of the Notes at specified redemption prices. As of December 31, 2014, we were in compliance with all debt covenants, which are customary in nature. | ||||||||
Our long-term debt as of December 31, 2014 was as follows (dollars in millions): | ||||||||
Senior Notes | Issued at Discount | Carrying | ||||||
to Par | Value | |||||||
$2.5 billion 1.875% Notes due 2018 | 99.943 | % | $ | 2,499 | ||||
$2.0 billion 2.650% Notes due 2020 | 99.76 | % | 1,996 | |||||
$1.0 billion 3.375% Notes due 2023 | 99.925 | % | 1,000 | |||||
$ | 5,495 | |||||||
The unamortized discount on the Notes consists of $5 million, which will be fully amortized by June 1, 2023. The effective interest rate on the Notes was 2.54% for the year ended December 31, 2014. | ||||||||
Convertible Debt | ||||||||
In November 2006, we issued our $1.725 billion 1.75% convertible senior notes due 2011 (the “2011 Notes”) and our 2013 Notes for total gross proceeds of $3.5 billion. The 2011 Notes matured and were settled in 2012. At that time, we paid the noteholders $1.7 billion in cash for the outstanding principal and 30 million shares for the $661 million in excess of the conversion value over the principal amount, as prescribed by the terms of the 2011 Notes. | ||||||||
The 2013 Notes matured and a majority of the noteholders exercised their rights to convert the outstanding 2013 Notes as of December 31, 2013. Pursuant to the settlement terms, the majority of the converted 2013 Notes were not settled until January 7, 2014. At that time, we paid the noteholders $1.7 billion in cash for the outstanding principal and 35 million shares for the $858 million excess of the conversion value over the principal amount, as prescribed in the terms of the 2013 Notes. | ||||||||
With respect to the conversion value in excess of the principal amount of the 2013 Notes converted, we elected to settle the excess with shares of our common stock based on a daily conversion value, determined in accordance with the indenture, calculated on a proportionate basis for each day of the relevant 20-day observation period. The actual conversion rate for the 2013 Notes was 62.6978 shares of our common stock per one thousand dollars of principal amount of 2013 Notes, which represents a 26.5% conversion premium from the date the 2013 Notes were issued and is equivalent to a conversion price of approximately $15.95 per share of our common stock. | ||||||||
The 2013 Notes paid interest in cash at a rate of 1.75% semi-annually in arrears on December 1 and June 1 of each year. The effective interest rate on the 2011 Notes and 2013 Notes was 5.6% for both the years ended December 31, 2013 and 2012. | ||||||||
The following table represents the key components of our interest expense on convertible debt (table in millions): | ||||||||
For the year ended | ||||||||
2013 | 2012 | |||||||
Contractual interest expense on the coupon | $ | 27 | $ | 30 | ||||
Amortization of the discount component recognized as interest expense | 58 | 61 | ||||||
Total interest expense on the convertible debt | $ | 85 | $ | 91 | ||||
In connection with the issuance of the 2011 Notes and 2013 Notes, we entered into separate convertible note hedge transactions with respect to our common stock (the “Purchased Options”). The Purchased Options allowed us to receive shares of our common stock and/or cash related to the excess conversion value that we would pay to the holders of the 2011 Notes and 2013 Notes upon conversion. The Purchased Options covered, subject to customary anti-dilution adjustments, approximately 215 million shares of our common stock. We paid an aggregate amount of $669 million of the proceeds from the sale of the 2011 Notes and 2013 Notes for the Purchased Options that was recorded as additional paid-in-capital in shareholders’ equity. In 2011, we exercised approximately half of the Purchased Options and in 2013, we exercised the remaining 108 million of the Purchased Options in conjunction with the planned settlements of the 2013 Notes. We received 35 million shares of net settlement on January 7, 2014, representing the excess conversion value of the options. | ||||||||
We also entered into separate transactions in which we sold warrants to acquire, subject to customary anti-dilution adjustments, approximately 215 million shares of our common stock at an exercise price of approximately $19.55 per share of our common stock. We received aggregate proceeds of $391 million from the sale of the associated warrants. Upon exercise, the value of the warrants was required to be settled in shares. Approximately half of the associated warrants were exercised in 2012 and the remaining 109 million associated warrants were exercised between February 18, 2014 and March 17, 2014 and were settled with 29 million shares of our common stock. | ||||||||
The Purchased Options and associated warrants had the effect of increasing the conversion price of the 2013 Notes to approximately $19.31 per share of our common stock, representing an approximate 53% conversion premium based on the closing price of $12.61 per share of our common stock on November 13, 2006, which was the issuance date of the 2013 Notes. | ||||||||
Interest Rate Swap Contracts | ||||||||
In 2010, EMC entered into interest rate swap contracts with an aggregate notional amount of approximately $900 million. These swaps were designated as cash flow hedges of the semi-annual interest payments of the forecasted issuance of debt in 2011. As such, the unrealized loss on these hedges was recognized in other comprehensive loss. | ||||||||
During 2011 and 2012, we settled the swaps and replaced them with new interest rate swap contracts for revised forecasted debt issuance dates. Each of these new swaps was deemed as an effective hedge as the notional amounts and other terms matched the underlying hedged item and accordingly, losses on the interest rate swap contracts were deferred as they were expected to be realized over the life of the new debt issued under the related interest rate swap contracts. In 2012, the change in the forecasted timeframe for the issuance of debt resulted in certain previously-anticipated hedge interest payments no longer being expected to occur within the window covered by the hedge designation. As a result, $40 million of accumulated realized losses in other comprehensive income related to these previously-anticipated interest payments were reclassified from other comprehensive income and recognized in the 2012 consolidated income statements. | ||||||||
In the second half of 2012, we settled the interest rate swap contracts and did not replace them. Accumulated losses at the time of settlement of $176 million were deferred as they were expected to be realized over the life of the new debt issued under the related interest rate swap contracts. The accumulated realized losses related to the settled swaps included in accumulated other comprehensive income are being realized over the remaining life of our ten year Notes. During 2014, $11 million in losses were reclassified from other comprehensive income and recognized as interest expense in the consolidated income statements. |
Fair_Value_of_Financial_Assets
Fair Value of Financial Assets and Liabilities | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||
Fair Value of Financial Assets and Liabilities | Fair Value of Financial Assets and Liabilities | |||||||||||||||||||||||
Our fixed income and equity investments are classified as available for sale and recorded at their fair market values. We determine fair value using the following hierarchy: | ||||||||||||||||||||||||
• | Level 1 – Quoted prices in active markets for identical assets or liabilities. | |||||||||||||||||||||||
• | Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |||||||||||||||||||||||
• | Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. | |||||||||||||||||||||||
Most of our fixed income securities are classified as Level 2, with the exception of some of our U.S. government and agency obligations and our investments in publicly traded equity securities, which are classified as Level 1, and all of our auction rate securities, which are classified as Level 3. In addition, our strategic investments held at cost are classified as Level 3. At December 31, 2014 and 2013, the vast majority of our Level 2 securities were priced by pricing vendors. These pricing vendors utilize the most recent observable market information in pricing these securities or, if specific prices are not available for these securities, use other observable inputs like market transactions involving identical or comparable securities. In the event observable inputs are not available, we assess other factors to determine the security’s market value, including broker quotes or model valuations. Each month, we perform independent price verifications of all of our fixed income holdings. In the event a price fails a pre-established tolerance check, it is researched so that we can assess the cause of the variance to determine what we believe is the appropriate fair market value. | ||||||||||||||||||||||||
In general, investments with remaining effective maturities of 12 months or less from the balance sheet date are classified as short-term investments. Investments with remaining effective maturities of more than 12 months from the balance sheet date are classified as long-term investments. Our publicly traded equity securities are classified as long-term investments and our strategic investments held at cost are classified as other assets. As a result of the lack of liquidity for auction rate securities, we have classified these as long-term investments as of December 31, 2014 and 2013. At December 31, 2014 and 2013, all of our short- and long-term investments, excluding auction rate securities, were recognized at fair value, which was determined based upon observable inputs from our pricing vendors for identical or similar assets. At December 31, 2014 and 2013, auction rate securities were valued using a discounted cash flow model. | ||||||||||||||||||||||||
The following tables summarize the composition of our short- and long-term investments at December 31, 2014 and 2013 (tables in millions): | ||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Aggregate | |||||||||||||||||||||
Cost | Gains | (Losses) | Fair Value | |||||||||||||||||||||
U.S. government and agency obligations | $ | 1,951 | $ | 2 | $ | (2 | ) | $ | 1,951 | |||||||||||||||
U.S. corporate debt securities | 1,998 | 1 | (4 | ) | 1,995 | |||||||||||||||||||
High yield corporate debt securities | 570 | 9 | (16 | ) | 563 | |||||||||||||||||||
Asset-backed securities | 53 | — | — | 53 | ||||||||||||||||||||
Municipal obligations | 948 | 2 | — | 950 | ||||||||||||||||||||
Auction rate securities | 29 | — | (2 | ) | 27 | |||||||||||||||||||
Foreign debt securities | 2,566 | 2 | (4 | ) | 2,564 | |||||||||||||||||||
Total fixed income securities | 8,115 | 16 | (28 | ) | 8,103 | |||||||||||||||||||
Publicly traded equity securities | 117 | 103 | (11 | ) | 209 | |||||||||||||||||||
Total | $ | 8,232 | $ | 119 | $ | (39 | ) | $ | 8,312 | |||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Aggregate | |||||||||||||||||||||
Cost | Gains | (Losses) | Fair Value | |||||||||||||||||||||
U.S. government and agency obligations | $ | 3,726 | $ | 4 | $ | (3 | ) | $ | 3,727 | |||||||||||||||
U.S. corporate debt securities | 2,260 | 8 | (2 | ) | 2,266 | |||||||||||||||||||
High yield corporate debt securities | 515 | 19 | (3 | ) | 531 | |||||||||||||||||||
Municipal obligations | 860 | 3 | — | 863 | ||||||||||||||||||||
Auction rate securities | 63 | — | (3 | ) | 60 | |||||||||||||||||||
Foreign debt securities | 2,152 | 6 | (3 | ) | 2,155 | |||||||||||||||||||
Total fixed income securities | 9,576 | 40 | (14 | ) | 9,602 | |||||||||||||||||||
Publicly traded equity securities | 72 | 24 | (1 | ) | 95 | |||||||||||||||||||
Total | $ | 9,648 | $ | 64 | $ | (15 | ) | $ | 9,697 | |||||||||||||||
We held approximately $2,564 million in foreign debt securities at December 31, 2014. These securities have an average credit rating of A+, and approximately 5% of these securities are deemed sovereign debt with an average credit rating of AA+. None of the securities deemed sovereign debt are from Argentina, Greece, Italy, Ireland, Portugal, Spain or Cyprus. | ||||||||||||||||||||||||
The following tables represent our fair value hierarchy for our financial assets and liabilities measured at fair value as of December 31, 2014 and 2013 (in millions): | ||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||
Cash | $ | 2,022 | $ | — | $ | — | $ | 2,022 | ||||||||||||||||
Cash equivalents | 3,710 | 611 | — | 4,321 | ||||||||||||||||||||
U.S. government and agency obligations | 1,141 | 810 | — | 1,951 | ||||||||||||||||||||
U.S. corporate debt securities | — | 1,995 | — | 1,995 | ||||||||||||||||||||
High yield corporate debt securities | — | 563 | — | 563 | ||||||||||||||||||||
Asset-backed securities | — | 53 | — | 53 | ||||||||||||||||||||
Municipal obligations | — | 950 | — | 950 | ||||||||||||||||||||
Auction rate securities | — | — | 27 | 27 | ||||||||||||||||||||
Foreign debt securities | — | 2,564 | — | 2,564 | ||||||||||||||||||||
Publicly traded equity securities | 209 | — | — | 209 | ||||||||||||||||||||
Total cash and investments | $ | 7,082 | $ | 7,546 | $ | 27 | $ | 14,655 | ||||||||||||||||
Other items: | ||||||||||||||||||||||||
Strategic investments carried at cost | $ | — | $ | — | $ | 333 | $ | 333 | ||||||||||||||||
Investment in joint venture | — | — | 37 | 37 | ||||||||||||||||||||
Long-term debt carried at discounted issuance cost | — | (5,544 | ) | — | (5,544 | ) | ||||||||||||||||||
Foreign exchange derivative assets | — | 44 | — | 44 | ||||||||||||||||||||
Foreign exchange derivative liabilities | — | (71 | ) | — | (71 | ) | ||||||||||||||||||
Commodity derivative assets | — | 12 | — | 12 | ||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||
Cash | $ | 1,725 | $ | — | $ | — | $ | 1,725 | ||||||||||||||||
Cash equivalents | 5,674 | 492 | — | 6,166 | ||||||||||||||||||||
U.S. government and agency obligations | 1,797 | 1,930 | — | 3,727 | ||||||||||||||||||||
U.S. corporate debt securities | — | 2,266 | — | 2,266 | ||||||||||||||||||||
High yield corporate debt securities | — | 531 | — | 531 | ||||||||||||||||||||
Municipal obligations | — | 863 | — | 863 | ||||||||||||||||||||
Auction rate securities | — | — | 60 | 60 | ||||||||||||||||||||
Foreign debt securities | — | 2,155 | — | 2,155 | ||||||||||||||||||||
Publicly traded equity securities | 95 | — | — | 95 | ||||||||||||||||||||
Total cash and investments | $ | 9,291 | $ | 8,237 | $ | 60 | $ | 17,588 | ||||||||||||||||
Other items: | ||||||||||||||||||||||||
Strategic investments carried at cost | $ | — | $ | — | $ | 379 | $ | 379 | ||||||||||||||||
Investment in joint venture | — | — | 35 | 35 | ||||||||||||||||||||
Long-term debt carried at discounted issuance cost | — | (5,419 | ) | — | (5,419 | ) | ||||||||||||||||||
Foreign exchange derivative assets | — | 31 | — | 31 | ||||||||||||||||||||
Foreign exchange derivative liabilities | — | (20 | ) | — | (20 | ) | ||||||||||||||||||
Commodity derivative assets | — | 4 | — | 4 | ||||||||||||||||||||
Our auction rate securities are predominantly rated investment grade and are primarily collateralized by student loans. The underlying loans of all but one of our auction rate securities, with a market value of $7 million, have partial guarantees by the U.S. government as part of the Federal Family Education Loan Program (“FFELP”) through the U.S. Department of Education. FFELP guarantees at least 95% of the loans which collateralize the auction rate securities. We believe the quality of the collateral underlying most of our auction rate securities will enable us to recover our principal balance. | ||||||||||||||||||||||||
To determine the estimated fair value of our investment in auction rate securities, we used a discounted cash flow model using a five year time horizon. As of December 31, 2014, the coupon rates used ranged from 0% to 3% and the discount rate was 1%, which rate represents the rate at which similar FFELP backed securities with a five year time horizon outside of the auction rate securities market were trading at December 31, 2014. The assumptions used in preparing the discounted cash flow model include an incremental discount rate for the lack of liquidity in the market (“liquidity discount margin”) for an estimated period of time. The discount rate we selected was based on AA-rated banks as the majority of our portfolio is invested in student loans where EMC acts as a financier to these lenders. The liquidity discount margin represents an estimate of the additional return an investor would require for the lack of liquidity of these securities over an estimated five-year holding period. The rate used for the discount margin was 1% at both December 31, 2014 and 2013, due to the narrowing of credit spreads on AA-rated banks during 2013 and into 2014. | ||||||||||||||||||||||||
Significant changes in the unobservable inputs discussed above could result in a significantly lower or higher fair value measurement. Generally, an increase in the discount rate, liquidity discount margin or coupon rate results in a decrease in our fair value measurement and a decrease in the discount rate, liquidity discount margin or coupon rate results in an increase in our fair value measurement. | ||||||||||||||||||||||||
During the year ended December 31, 2014, we had $34 million of auction rate securities called and during the year ended December 31, 2013, we sold $8 million of our auction rate securities. | ||||||||||||||||||||||||
EMC has a 49% ownership percentage of LenovoEMC Limited, a joint venture with Lenovo that was formed in 2012. We account for our LenovoEMC joint venture using the fair value method of accounting. To determine the estimated fair value at inception of our investment, we used a discounted cash flow model using a three year time horizon, and utilized a discount rate of 6%, which represented the incremental borrowing rate for a market participant. The assumptions used in preparing the discounted cash flow model include an analysis of estimated Lenovo NAS revenue against a prescribed target as well as consideration of the purchase price put and call features included in the joint venture agreement. The put and call features create a floor and a cap on the fair value of the investment. As such, there is a limit to the impact on the fair value that would result from significant changes in the unobservable inputs. We had no changes to the assumptions utilized in the fair value calculation in the fourth quarter of 2014. There was no material change to the fair value of this joint venture during the years ended December 31, 2014 and 2013. | ||||||||||||||||||||||||
The carrying value of the strategic investments carried at cost were accounted for under the cost method. As part of our quarterly impairment review, we perform a fair value calculation of our strategic investments carried at cost using the most currently available information. To determine the estimated fair value of private strategic investments carried at cost, we use a combination of several valuation techniques including discounted cash flow models, acquisition and trading comparables. In addition, we evaluate the impact of pre- and post-money valuations of recent financing events and the impact of those on our fully diluted ownership percentages, and we consider any available information regarding the issuer’s historical and forecasted performance as well as market comparables and conditions. The fair value of these investments is considered in our review for impairment if any events and changes in circumstances occur that might have a significant adverse effect on their value. | ||||||||||||||||||||||||
Investment Losses | ||||||||||||||||||||||||
Unrealized losses on investments at December 31, 2014 and 2013 by investment category and length of time the investment has been in a continuous unrealized loss position are as follows (table in millions): | ||||||||||||||||||||||||
December 31, 2014 | Less Than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||
Fair | Gross | Fair | Gross | Fair | Gross | |||||||||||||||||||
Value | Unrealized | Value | Unrealized | Value | Unrealized | |||||||||||||||||||
Losses | Losses | Losses | ||||||||||||||||||||||
U.S. government and agency obligations | $ | 1,168 | $ | (2 | ) | $ | — | $ | — | $ | 1,168 | $ | (2 | ) | ||||||||||
U.S. corporate debt securities | 1,383 | (4 | ) | — | — | 1,383 | (4 | ) | ||||||||||||||||
High yield corporate debt securities | 244 | (16 | ) | — | — | 244 | (16 | ) | ||||||||||||||||
Auction rate securities | — | — | 27 | (2 | ) | 27 | (2 | ) | ||||||||||||||||
Foreign debt securities | 1,563 | (4 | ) | — | — | 1,563 | (4 | ) | ||||||||||||||||
Publicly traded equity securities | 17 | (9 | ) | 3 | (2 | ) | 20 | (11 | ) | |||||||||||||||
Total | $ | 4,375 | $ | (35 | ) | $ | 30 | $ | (4 | ) | $ | 4,405 | $ | (39 | ) | |||||||||
December 31, 2013 | Less Than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||
Fair | Gross | Fair | Gross | Fair | Gross | |||||||||||||||||||
Value | Unrealized | Value | Unrealized | Value | Unrealized | |||||||||||||||||||
Losses | Losses | Losses | ||||||||||||||||||||||
U.S. government and agency obligations | $ | 1,161 | $ | (3 | ) | $ | 20 | $ | — | $ | 1,181 | $ | (3 | ) | ||||||||||
U.S. corporate debt securities | 532 | (2 | ) | 17 | — | 549 | (2 | ) | ||||||||||||||||
High yield corporate debt securities | 120 | (3 | ) | — | — | 120 | (3 | ) | ||||||||||||||||
Municipal obligations | 51 | — | — | — | 51 | — | ||||||||||||||||||
Auction rate securities | — | — | 60 | (3 | ) | 60 | (3 | ) | ||||||||||||||||
Foreign debt securities | 695 | (3 | ) | 6 | — | 701 | (3 | ) | ||||||||||||||||
Publicly traded equity securities | — | — | 25 | (1 | ) | 25 | (1 | ) | ||||||||||||||||
Total | $ | 2,559 | $ | (11 | ) | $ | 128 | $ | (4 | ) | $ | 2,687 | $ | (15 | ) | |||||||||
For all of our securities for which the amortized cost basis was greater than the fair value at December 31, 2014 and 2013, we have concluded that currently we neither plan to sell the security nor is it more likely than not that we would be required to sell the security before its anticipated recovery. In making the determination as to whether the unrealized loss is other-than-temporary, we considered the length of time and extent the investment has been in an unrealized loss position, the financial condition and near-term prospects of the issuers, the issuers’ credit rating and the time to maturity. | ||||||||||||||||||||||||
During 2014, net realized gains of $101 million were recorded in other expense, net on the consolidated income statements for gains related to previously held interests in strategic investments and joint venture. During 2012, a realized gain of $32 million was recorded in other expense, net on the consolidated income statements for a gain related to previously held interests in strategic investments. | ||||||||||||||||||||||||
Contractual Maturities | ||||||||||||||||||||||||
The contractual maturities of fixed income securities held at December 31, 2014 are as follows (table in millions): | ||||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||
Amortized | Aggregate | |||||||||||||||||||||||
Cost Basis | Fair Value | |||||||||||||||||||||||
Due within one year | $ | 1,946 | $ | 1,946 | ||||||||||||||||||||
Due after 1 year through 5 years | 5,332 | 5,330 | ||||||||||||||||||||||
Due after 5 years through 10 years | 548 | 540 | ||||||||||||||||||||||
Due after 10 years | 289 | 287 | ||||||||||||||||||||||
Total | $ | 8,115 | $ | 8,103 | ||||||||||||||||||||
Short-term investments on the consolidated balance sheet include $32 million in variable rate notes which have contractual maturities in 2015, and are not classified within investments due within one year above. |
Inventories
Inventories | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Inventory Disclosure [Abstract] | ||||||||
Inventories | Inventories | |||||||
Inventories consist of (table in millions): | ||||||||
December 31, | December 31, | |||||||
2014 | 2013 | |||||||
Work-in-process | $ | 627 | $ | 696 | ||||
Finished goods | 649 | 638 | ||||||
$ | 1,276 | $ | 1,334 | |||||
Accounts_and_Notes_Receivable_
Accounts and Notes Receivable and Allowance for Credit Losses | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Receivables [Abstract] | ||||||||||||||||
Accounts and Notes Receivable and Allowance for Credit Losses | Accounts and Notes Receivable and Allowance for Credit Losses | |||||||||||||||
Accounts and notes receivable are recorded at cost. The portion of our notes receivable due in one year or less are included in accounts and notes receivable and the long-term portion is included in other assets, net on the consolidated balance sheets. Lease receivables arise from sales-type leases of products. We typically sell, without recourse, the contractual right to the lease payment stream and assets under lease to third parties. For certain customers, we retain the lease. | ||||||||||||||||
The contractual amounts due under the leases we retained as of December 31, 2014 were as follows (table in millions): | ||||||||||||||||
Year | Contractual Amounts | |||||||||||||||
Due Under Leases | ||||||||||||||||
Due within one year | $ | 97 | ||||||||||||||
Due within two years | 73 | |||||||||||||||
Due within three years | 62 | |||||||||||||||
Thereafter | 1 | |||||||||||||||
Total | 233 | |||||||||||||||
Less amounts representing interest | (5 | ) | ||||||||||||||
Present value | 228 | |||||||||||||||
Current portion (included in accounts and notes receivable) | 94 | |||||||||||||||
Long-term portion (included in other assets, net) | $ | 134 | ||||||||||||||
Subsequent to December 31, 2014, we sold $54 million of these notes to third parties without recourse. | ||||||||||||||||
We maintain an allowance for credit losses on our accounts and notes receivable. The allowance is based on the credit worthiness of our customers, including an assessment of the customer’s financial position, operating performance and their ability to meet their contractual obligation. We assess the creditworthiness for our customers each quarter. In addition, we consider our historical experience, the age of the receivable and current market and economic conditions. Uncollectible amounts are charged against the allowance account. | ||||||||||||||||
In the event we determine that a lease may not be paid, we include in our allowance an amount for the outstanding balance related to the lease receivable. As of December 31, 2014, amounts from lease receivables past due for more than 90 days were not significant. | ||||||||||||||||
The following table presents the activity of our allowance for credit losses related to lease receivables for the years ended December 31, 2014 and 2013 (table in millions): | ||||||||||||||||
December 31, | December 31, | |||||||||||||||
2014 | 2013 | |||||||||||||||
Balance, beginning of the period | $ | 9 | $ | 17 | ||||||||||||
Recoveries | (7 | ) | (12 | ) | ||||||||||||
Provisions | 4 | 4 | ||||||||||||||
Balance, end of the period | $ | 6 | $ | 9 | ||||||||||||
Gross lease receivables totaled $233 million and $252 million in 2014 and 2013, respectively, before the allowance. The components of these balances were individually evaluated for impairment and included in our allowance determination as necessary. | ||||||||||||||||
EMC CORPORATION AND SUBSIDIARIES | ||||||||||||||||
SCHEDULE II–VALUATION AND QUALIFYING ACCOUNTS | ||||||||||||||||
(in millions) | ||||||||||||||||
Allowance for Bad Debts | Balance at Beginning of Period | Allowance for Bad Debts Charged to Selling, General and Administrative Expenses | Bad Debts | Balance at | ||||||||||||
Description | Write-Offs | End of Period | ||||||||||||||
Year ended December 31, 2014 allowance for doubtful accounts | $ | 65 | $ | 10 | $ | (1 | ) | $ | 74 | |||||||
Year ended December 31, 2013 allowance for doubtful accounts | 72 | (1 | ) | (6 | ) | 65 | ||||||||||
Year ended December 31, 2012 allowance for doubtful accounts | 65 | 39 | (32 | ) | 72 | |||||||||||
Note: The allowance for doubtful accounts includes both current and non-current portions. | ||||||||||||||||
Allowance for Sales Returns | Balance at Beginning of Period | Allowance for Sales Returns Accounted for as a Reduction in Revenue | Sales Returns | Balance at | ||||||||||||
Description | End of Period | |||||||||||||||
Year ended December 31, 2014 allowance for sales returns | $ | 76 | $ | 89 | $ | (95 | ) | $ | 70 | |||||||
Year ended December 31, 2013 allowance for sales returns | 86 | 55 | (65 | ) | 76 | |||||||||||
Year ended December 31, 2012 allowance for sales returns | 133 | 17 | (64 | ) | 86 | |||||||||||
Tax Valuation Allowance | Balance at Beginning of Period | Tax Valuation Allowance Charged to Income Tax Provision | Tax Valuation Allowance Credited to Income Tax Provision | Balance at | ||||||||||||
Description | End of Period | |||||||||||||||
Year ended December 31, 2014 income tax valuation allowance | $ | 211 | $ | 1 | $ | (86 | ) | $ | 126 | |||||||
Year ended December 31, 2013 income tax valuation allowance | 183 | 32 | (4 | ) | 211 | |||||||||||
Year ended December 31, 2012 income tax valuation allowance | 151 | 33 | (1 | ) | 183 | |||||||||||
Property_Plant_and_Equipment
Property, Plant and Equipment | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ||||||||
Property, Plant and Equipment | Property, Plant and Equipment | |||||||
Property, plant and equipment consist of (table in millions): | ||||||||
December 31, | December 31, | |||||||
2014 | 2013 | |||||||
Furniture and fixtures | $ | 255 | $ | 229 | ||||
Equipment and software | 6,684 | 5,973 | ||||||
Buildings and improvements | 2,308 | 2,089 | ||||||
Land | 162 | 132 | ||||||
Building construction in progress | 134 | 215 | ||||||
9,543 | 8,638 | |||||||
Accumulated depreciation | (5,777 | ) | (5,160 | ) | ||||
$ | 3,766 | $ | 3,478 | |||||
Depreciation expense was $998 million, $867 million and $780 million in 2014, 2013 and 2012, respectively. Building construction in progress at December 31, 2014 includes $76 million for facilities not yet placed in service that we are holding for future use. |
Joint_Ventures
Joint Ventures | 12 Months Ended |
Dec. 31, 2014 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Joint Ventures | Joint Venture |
We make investments in joint ventures. For each joint venture investment we consider the facts and circumstances in order to determine whether it qualifies for cost accounting, equity accounting, fair value method accounting or whether it should be consolidated. | |
In 2009, Cisco and EMC formed VCE Company LLC (“VCE”), with investments from VMware and Intel. VCE, through Vblock infrastructure platforms, delivers an integrated IT offering that combines network, computing, storage, management, security and virtualization technologies for converged infrastructures and cloud based computing models. As of December 31, 2014, we had contributed $1,555 million in funding and $17 million in stock-based compensation to VCE since inception. | |
In December 2014, EMC acquired the controlling interest in VCE. Prior to the acquisition of the controlling interest in VCE, we considered VCE a variable interest entity. Authoritative guidance related to variable interest entities states that the primary beneficiary of a variable interest entity must have both of the following characteristics: (a) the power to direct the activities of a variable interest entity that most significantly will impact the entity’s economic performance; and (b) the obligation to absorb losses that could be potentially significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity. Since the power to direct the activities of VCE which most significantly impact its economic performance was determined by its board of directors, which was comprised of equal representation of EMC and Cisco, and all significant decisions required the approval of the minority shareholders, we determined that prior to acquiring the controlling interest, we were not the primary beneficiary, and as such we accounted for the investment under the equity method. Since the date of acquiring the controlling interest in VCE, we have consolidated VCE’s financial results as part of EMC's consolidated financial statements. | |
Prior to the date of acquisition and the consolidation of VCE, our portion of VCE’s gains and losses were recognized in other expense, net, in the consolidated income statements. Our consolidated share of VCE’s losses, based upon our portion of the overall funding, was approximately 64% for the year ended December 31, 2014 and 63% for each of the years ended December 31, 2013 and 2012. As of December 31, 2014, we had recorded net accumulated losses from VCE of $1,153 million since inception, of which $357 million, $298 million and $245 million were recorded in 2014, 2013 and 2012, respectively. | |
We recognized $803 million, $439 million and $286 million in revenue from sales of product and services to VCE during the years ended December 31, 2014, 2013 and 2012, respectively. In addition, we performed certain administrative services, pursuant to an administrative services agreement, on behalf of VCE and we paid certain operating expenses on behalf of VCE. |
Accrued_Expenses
Accrued Expenses | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Payables and Accruals [Abstract] | ||||||||||||
Accrued Expenses | Accrued Expenses | |||||||||||
Accrued expenses consist of (table in millions): | ||||||||||||
December 31, | December 31, | |||||||||||
2014 | 2013 | |||||||||||
Salaries and benefits | $ | 1,260 | $ | 1,078 | ||||||||
Product warranties | 210 | 289 | ||||||||||
Dividends payable (see Note O) | 237 | 205 | ||||||||||
Partner rebates | 235 | 214 | ||||||||||
Restructuring, current (See Note Q) | 115 | 84 | ||||||||||
Derivatives | 75 | 23 | ||||||||||
Other | 1,009 | 890 | ||||||||||
$ | 3,141 | $ | 2,783 | |||||||||
Product Warranties | ||||||||||||
Systems sales include a standard product warranty. At the time of the sale, we accrue for systems’ warranty costs. The initial systems’ warranty accrual is based upon our historical experience, expected future costs and specific identification of systems’ requirements. Upon sale or expiration of the initial warranty, we may sell additional maintenance contracts to our customers. Revenue from these additional maintenance contracts is included in deferred revenue and recognized ratably over the service period. The following represents the activity in our warranty accrual for the years ended December 31, 2014, 2013 and 2012 (table in millions): | ||||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Balance, beginning of the period | $ | 289 | $ | 278 | $ | 255 | ||||||
Provision | 150 | 198 | 182 | |||||||||
Amounts charged to the accrual | (229 | ) | (187 | ) | (159 | ) | ||||||
Balance, end of the period | $ | 210 | $ | 289 | $ | 278 | ||||||
The provision includes amounts accrued for systems at the time of shipment, adjustments for changes in estimated costs for warranties on systems shipped in the period and changes in estimated costs for warranties on systems shipped in prior periods. It is not practicable to determine the amounts applicable to each of the components. |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||
Income Taxes | Income Taxes | ||||||||||||||||
Our provision (benefit) for income taxes consists of (table in millions): | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Federal: | |||||||||||||||||
Current | $ | 955 | $ | 698 | $ | 792 | |||||||||||
Deferred | (308 | ) | (163 | ) | (80 | ) | |||||||||||
647 | 535 | 712 | |||||||||||||||
State: | |||||||||||||||||
Current | 81 | 84 | 74 | ||||||||||||||
Deferred | (70 | ) | (23 | ) | (12 | ) | |||||||||||
11 | 61 | 62 | |||||||||||||||
Foreign: | |||||||||||||||||
Current | 228 | 192 | 169 | ||||||||||||||
Deferred | (18 | ) | (16 | ) | (25 | ) | |||||||||||
210 | 176 | 144 | |||||||||||||||
Total provision for income taxes | $ | 868 | $ | 772 | $ | 918 | |||||||||||
In 2014, 2013 and 2012, we were able to utilize net operating loss carryforwards and tax credit carryforwards to reduce the current portion of our tax provision by $34 million, $54 million and $59 million, respectively. | |||||||||||||||||
The effective income tax rate is based upon income for the year, composition of the income in different countries, effect of tax law changes and adjustments, if any, for potential tax consequences, benefits and/or resolutions of tax audits or other tax contingencies. A reconciliation of our income tax provision to the statutory federal tax rate is as follows: | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Statutory federal tax rate | 35 | % | 35 | % | 35 | % | |||||||||||
State taxes, net of federal taxes | 2.6 | 0.7 | 0.5 | ||||||||||||||
Resolution of uncertain tax positions | (0.9 | ) | (0.9 | ) | (0.5 | ) | |||||||||||
Tax rate differential for international jurisdictions and other international related tax items | (11.3 | ) | (15.0 | ) | (13.6 | ) | |||||||||||
U.S. tax credits | (1.9 | ) | (3.8 | ) | (0.2 | ) | |||||||||||
Change in valuation allowance | (2.3 | ) | 0.7 | 0.8 | |||||||||||||
U.S. domestic production activities deduction | (1.8 | ) | (1.5 | ) | (1.3 | ) | |||||||||||
International reorganization of acquired companies | — | 0.6 | 0.3 | ||||||||||||||
Permanent items | 3.9 | 3.8 | 2.8 | ||||||||||||||
Other | (0.2 | ) | 0.4 | 0.3 | |||||||||||||
23.1 | % | 20 | % | 24.1 | % | ||||||||||||
Substantially all the tax rate differential for international jurisdictions was driven by earnings of our Irish subsidiaries. Changes in valuation allowance are due to our assessment of the realizability of deferred tax assets related to certain state tax credit carryforwards. Based on our 2014 assessment, we released our partial valuation allowance provided in prior years. | |||||||||||||||||
On December 19, 2014, the Tax Increase Prevention Act was signed into law. Some of the provisions were retroactive to January 1, 2014 including an extension of the U.S. federal tax credit for increasing research activities through December 31, 2014. Our 2014 effective income tax rate reflects our estimated 2014 federal tax credit for increasing research activities. | |||||||||||||||||
On January 2, 2013, the American Taxpayer Relief Act of 2012 was signed into law. Some of the provisions were retroactive to January 1, 2012 including an extension of the U.S. federal tax credit for increasing research activities through December 31, 2013. Because the extension was enacted after December 31, 2012, our 2012 effective income tax rate did not reflect our 2012 federal tax credit for increasing research activities even though it was reported on our 2012 federal income tax returns. Our 2013 income tax provision included the federal tax credit for increasing research activities for 2012 as well as for 2013, which reduced our 2013 effective income tax rate by 3.5%. | |||||||||||||||||
The components of the current and non-current deferred tax assets and liabilities are as follows (table in millions): | |||||||||||||||||
31-Dec-14 | December 31, 2013 | ||||||||||||||||
Deferred | Deferred | Deferred | Deferred | ||||||||||||||
Tax | Tax | Tax | Tax | ||||||||||||||
Asset | Liability | Asset | Liability | ||||||||||||||
Current: | |||||||||||||||||
Accounts and notes receivable | $ | 59 | $ | — | $ | 96 | $ | — | |||||||||
Inventory | 73 | — | 73 | — | |||||||||||||
Accrued expenses | 305 | — | 311 | — | |||||||||||||
Deferred revenue | 472 | — | 365 | — | |||||||||||||
Equity | 148 | — | 83 | — | |||||||||||||
Credit carryforwards | 21 | — | 4 | — | |||||||||||||
Net operating losses | 23 | — | 28 | — | |||||||||||||
Total current | 1,101 | — | 960 | — | |||||||||||||
Property, plant and equipment, net | — | (323 | ) | — | (291 | ) | |||||||||||
Intangible and other assets, net | — | (605 | ) | — | (680 | ) | |||||||||||
Equity | 106 | — | 139 | — | |||||||||||||
Deferred revenue | 346 | — | 253 | — | |||||||||||||
Other non-current liabilities | 23 | — | — | (13 | ) | ||||||||||||
Credit carryforward | 234 | — | 280 | — | |||||||||||||
Net operating losses | 93 | — | 78 | — | |||||||||||||
Other comprehensive loss | 103 | — | 109 | — | |||||||||||||
Total non-current | 905 | (928 | ) | 859 | (984 | ) | |||||||||||
Gross deferred tax assets and liabilities | 2,006 | (928 | ) | 1,819 | (984 | ) | |||||||||||
Valuation allowance | (126 | ) | — | (211 | ) | — | |||||||||||
Total deferred tax assets and liabilities | $ | 1,880 | $ | (928 | ) | $ | 1,608 | $ | (984 | ) | |||||||
At December 31, 2014 and 2013, net non-current state and foreign deferred tax assets of $157 million and $133 million, respectively, were included in other assets, net on the consolidated balance sheets. | |||||||||||||||||
We have gross federal, state and foreign net operating loss carryforwards of $264 million, $298 million and $24 million, respectively, at December 31, 2014. Portions of these carryforwards are subject to annual limitations, including Section 382 of the Internal Revenue Code of 1986 (“Code”), as amended, for U.S. tax purposes and similar provisions under other countries’ tax laws. Certain of these net operating loss carryforwards will begin to expire in 2015 if not utilized, while others have an unlimited carryforward period. We have provided a valuation allowance of $4 million and $1 million for deferred tax assets related to state and foreign net operating loss carryforwards, respectively, that are not expected to be realized. | |||||||||||||||||
We have federal and state credit carryforwards of $4 million and $468 million, respectively, at December 31, 2014. Portions of these carryforwards are subject to annual limitations, including Section 382 of the Code, as amended, for U.S. tax purposes and similar provisions under other countries’ tax laws. Certain of these credit carryforwards will begin to expire in 2019 if not utilized, while others have an unlimited carryforward period. We have provided a full valuation allowance of $121 million for deferred tax assets related to Massachusetts tax credit carryforwards that are not expected to be realized. | |||||||||||||||||
Deferred income taxes have not been provided on basis differences related to investments in foreign subsidiaries. These basis differences were approximately $11.8 billion and $10.2 billion at December 31, 2014 and 2013, respectively, and consisted primarily of undistributed earnings permanently invested in these entities. The change in the basis difference in 2014 was mainly attributable to income earned in the current year. At December 31, 2014, our total cash, cash equivalents, and short-term and long-term investments were $14.7 billion. This balance includes approximately $7.1 billion held by VMware, of which $5.0 billion is held outside of the U.S., and $5.3 billion held by EMC in entities outside of the U.S. If these overseas funds are needed for our operations in the U.S., we would be required to accrue and pay U.S. taxes to repatriate these funds. However, our intent is to permanently reinvest these funds outside of the U.S. and our current plans do not demonstrate a need to repatriate them to fund our U.S. operations. Determination of the amount of unrecognized deferred income tax liability related to these earnings is not practicable. Income before income taxes from foreign operations for 2014, 2013 and 2012 was $1.8 billion, $2.3 billion and $1.9 billion, respectively. Income before income taxes from domestic operations for 2014, 2013 and 2012 was $2.0 billion, $1.6 billion and $1.9 billion, respectively. | |||||||||||||||||
The following is a rollforward of our gross consolidated liability for unrecognized income tax benefits for the three years ended December 31 (table in millions): | |||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Unrecognized tax benefits, beginning of year | $ | 266 | $ | 270 | $ | 197 | |||||||||||
Tax positions related to current year: | |||||||||||||||||
Additions | 63 | 37 | 25 | ||||||||||||||
Reductions | — | — | (1 | ) | |||||||||||||
Tax positions related to prior years: | |||||||||||||||||
Additions | 91 | 10 | 64 | ||||||||||||||
Reductions | (31 | ) | (33 | ) | (4 | ) | |||||||||||
Settlements | (1 | ) | (5 | ) | — | ||||||||||||
Lapses in statutes of limitations | (5 | ) | (13 | ) | (11 | ) | |||||||||||
Unrecognized tax benefits, end of year | $ | 383 | $ | 266 | $ | 270 | |||||||||||
As of December 31, 2014, 2013 and 2012, $316 million, $261 million and $255 million, respectively, of the unrecognized tax benefits, if recognized, would have been recorded as a reduction to income tax expense. The remainder would be an adjustment to shareholders’ equity. | |||||||||||||||||
We are routinely under audit by the Internal Revenue Service (the “IRS”). We have concluded all U.S. federal income tax matters for years through 2008. The IRS commenced a federal income tax audit for the tax years 2009 and 2010 in the third quarter of 2012. The current federal income tax audit is ongoing and is not expected to be completed until 2015. We also have income tax audits in process in numerous state, local and international jurisdictions. In our international jurisdictions that comprise a significant portion of our operations, the years that may be examined vary, with the earliest year being 2005. Based on the timing and outcome of examinations of EMC, the result of the expiration of statutes of limitations for specific jurisdictions or the timing and result of ruling requests from taxing authorities, it is reasonably possible that the related unrecognized tax benefits could change from those recorded in our statement of financial position. We anticipate that several of these audits may be finalized within the next twelve months. While we expect the amount of unrecognized tax benefits to change in the next twelve months, we do not expect the change to have a significant impact on our results of operations or financial position. | |||||||||||||||||
We recognize interest expense and penalties related to income tax matters in income tax expense. For 2014, 2013 and 2012, $9 million, $9 million and $4 million, respectively, in interest expense was recognized. In addition to the unrecognized tax benefits noted above, the gross balance of the accrued interest and penalties were $51 million, $42 million and $35 million as of December 31, 2014, 2013 and 2012, respectively. |
Retirement_Plan_Benefits
Retirement Plan Benefits | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Compensation and Retirement Disclosure [Abstract] | |||||||||||||||||
Retirement Plan Benefits | Retirement Plan Benefits | ||||||||||||||||
401(k) Plan | |||||||||||||||||
EMC’s Information Infrastructure business has a defined contribution program for certain employees that is qualified under Section 401(k) of the Code. EMC will match pre-tax employee contributions up to 6% of eligible compensation during each pay period (subject to a $750 maximum match each quarter). Matching contributions are subject to a 3 year vesting period. VMware also has a defined contribution program for certain employees that is qualified under Section 401(k) of the Code. Our combined contributions amounted to $105 million, $91 million and $88 million in 2014, 2013 and 2012, respectively. | |||||||||||||||||
Employees may elect to invest their contributions in a variety of funds, including an EMC stock fund. The program limits an employee’s maximum investment allocation in the EMC stock fund to 30% of their total contribution. Our matching contribution mirrors the investment allocation of the employee’s contribution. | |||||||||||||||||
Defined Benefit Pension Plan | |||||||||||||||||
We have a noncontributory defined benefit pension plan which was assumed as part of the Data General acquisition, which covers substantially all former Data General employees located in the U.S. In addition, certain of our foreign subsidiaries also have a defined benefit pension plan. | |||||||||||||||||
Benefits under these plans are generally based on either career average or final average salaries and creditable years of service as defined in the plans. The annual cost for these plans is determined using the projected unit credit actuarial cost method that includes actuarial assumptions and estimates which are subject to change. The measurement date for the plans is December 31. | |||||||||||||||||
The Data General U.S. pension plan’s (the “Pension Plan”) investment policy provides that no security, except issues of the U.S. Government, shall comprise more than 5% of total plan assets, measured at market. At December 31, 2014, the Pension Plan held $0.5 million of EMC common stock. | |||||||||||||||||
The Pension Plan is summarized in the following tables. The other pension plans are not presented because they do not have a material impact on our consolidated financial statements. | |||||||||||||||||
The components of the change in benefit obligation of the Pension Plan is as follows (table in millions): | |||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Benefit obligation, at beginning of year | $ | 495 | $ | 539 | |||||||||||||
Interest cost | 22 | 20 | |||||||||||||||
Benefits paid | (19 | ) | (18 | ) | |||||||||||||
Actuarial loss (gain) | 56 | (46 | ) | ||||||||||||||
Benefit obligation, at end of year | $ | 554 | $ | 495 | |||||||||||||
The reconciliation of the beginning and ending balances of the fair value of the assets of the Pension Plan is as follows (table in millions): | |||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Fair value of plan assets, at beginning of year | $ | 449 | $ | 431 | |||||||||||||
Actual return on plan assets | 56 | 35 | |||||||||||||||
Employer contributions to plan | — | 1 | |||||||||||||||
Benefits paid | (19 | ) | (18 | ) | |||||||||||||
Fair value of plan assets, at end of year | $ | 486 | $ | 449 | |||||||||||||
We did not make any significant contributions to the Pension Plan in 2014 or 2013 and we do not expect to make a contribution to the Pension Plan in 2015. The under-funded status of the Pension Plan at December 31, 2014 and 2013 was $68 million and $46 million, respectively. This amount is classified as a component of other long-term liabilities on the consolidated balance sheets. | |||||||||||||||||
In 2014, $9 million of the accumulated actuarial loss and prior services cost associated with the Pension Plan was reclassified from accumulated comprehensive loss to a component of net periodic benefit cost. Additionally, the Pension Plan had net losses of $30 million that are included in accumulated other comprehensive income (loss), which were primarily the result of a decrease in the discount rate at the end of 2014, changes to the mortality table and a lower rate of return on plan assets. We expect that $12 million of the total balance included in accumulated other comprehensive income (loss) at December 31, 2014 will be recognized as a component of net periodic benefit costs in 2015. | |||||||||||||||||
The components of net periodic expense of the Pension Plan are as follows (table in millions): | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
Interest cost | $ | 22 | $ | 20 | |||||||||||||
Expected return on plan assets | (29 | ) | (28 | ) | |||||||||||||
Recognized actuarial loss | 9 | 15 | |||||||||||||||
Net periodic expense | $ | 2 | $ | 7 | |||||||||||||
The weighted-average assumptions used in the Pension Plan to determine benefit obligations at December 31 are as follows: | |||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Discount rate | 3.9 | % | 4.7 | % | 3.7 | % | |||||||||||
Rate of compensation increase | N/A | N/A | N/A | ||||||||||||||
The weighted-average assumptions used in the Pension Plan to determine periodic benefit cost for the years ended December 31 are as follows: | |||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Discount rate | 4.7 | % | 3.7 | % | 4.6 | % | |||||||||||
Expected long-term rate of return on plan assets | 6.75 | % | 6.75 | % | 6.75 | % | |||||||||||
Rate of compensation increase | N/A | N/A | N/A | ||||||||||||||
The benefit payments are expected to be paid in the following years (table in millions): | |||||||||||||||||
2015 | $ | 21 | |||||||||||||||
2016 | 22 | ||||||||||||||||
2017 | 23 | ||||||||||||||||
2018 | 25 | ||||||||||||||||
2019 | 27 | ||||||||||||||||
2020-2024 | 159 | ||||||||||||||||
Fair Value of Plan Assets | |||||||||||||||||
Following is a description of the valuation methodologies used for assets measured at fair value at December 31, 2014: | |||||||||||||||||
Common Collective Trusts – valued at the net asset value calculated by the fund manager based on the underlying investments. These are all classified within Level 2 of the valuation hierarchy. These include: EB Daily Valued Large Cap Growth Stock Index Fund, EB Daily Valued Large Cap Value Stock Index Fund, EB Daily Valued Stock Index Fund, EB Daily Valued Small Cap Stock Index Fund, EB Daily Valued International Stock Index Fund, EB Daily Valued Emerging Markets Stock Index Fund, Custom Long Duration Fixed Income, Collective Trust High Yield Fund, EB Long Term Credit Bond Index, EB Long Term Government Bond Index Fund and EB Temporary Investment Fund. | |||||||||||||||||
Corporate Debt Securities – valued daily at the closing price reported in active U.S. financial markets and are classified within Level 2 of the valuation hierarchy. | |||||||||||||||||
The following table sets forth, by level within the fair value hierarchy, the Pension Plan’s assets at fair value as of December 31, 2014 and 2013 (table in millions): | |||||||||||||||||
December 31, 2014 | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Common collective trusts | $ | — | $ | 350 | $ | — | $ | 350 | |||||||||
U.S. Treasury securities | 2 | — | — | 2 | |||||||||||||
Corporate debt securities | — | 132 | — | 132 | |||||||||||||
Total | $ | 2 | $ | 482 | $ | — | 484 | ||||||||||
Plan payables, net of accrued interest and dividends | 2 | ||||||||||||||||
Total | $ | 486 | |||||||||||||||
December 31, 2013 | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Common collective trusts | $ | — | $ | 330 | $ | — | $ | 330 | |||||||||
U.S. Treasury securities | 2 | — | — | 2 | |||||||||||||
Corporate debt securities | — | 114 | — | 114 | |||||||||||||
Total | $ | 2 | $ | 444 | $ | — | 446 | ||||||||||
Plan payables, net of accrued interest and dividends | 3 | ||||||||||||||||
Total | $ | 449 | |||||||||||||||
Dividends, accrued interest and net plan payables are not material to the plan assets. Accordingly, we have not classified these into the fair value hierarchy above at December 31, 2014 and 2013. | |||||||||||||||||
Concentration of Risks | |||||||||||||||||
Pension Plan investments at fair value as of December 31, 2014 and 2013 which represented 5% or more of the Pension Plan’s net assets were as follows (table in millions): | |||||||||||||||||
2014 | 2013 | ||||||||||||||||
EB Daily Valued Small Cap Stock Index Fund | $ | 30 | $ | 30 | |||||||||||||
EB Daily Valued Stock Index Fund | 103 | 104 | |||||||||||||||
EB Daily Valued International Stock Index Fund | 27 | 30 | |||||||||||||||
EB Long Term Government Bond Index | 50 | 40 | |||||||||||||||
EB Long Term Credit Bond Index | 74 | 63 | |||||||||||||||
Corporate Debt Securities | — | 118 | |||||||||||||||
Custom Long Duration Fixed Income | 137 | — | |||||||||||||||
$ | 421 | $ | 385 | ||||||||||||||
Investment Strategy | |||||||||||||||||
The Pension Plan’s assets are managed by outside investment managers. Our investment strategy with respect to pension assets is to achieve a long-term growth of capital, consistent with an appropriate level of risk. | |||||||||||||||||
The expected long-term rate of return on the Pension Plan assets considers the current level of expected returns on risk free investments (primarily government bonds), the historical level of the risk premium associated with the other asset classes in which the portfolio is invested and the expectations for future returns of each asset class. The expected return for each asset class was weighted based on the target asset allocation to develop the expected long-term rate of return on assets. As market conditions permit, we expect to continue to shift the asset allocation to lower the percentage of investments in equities and increase the percentage of investments in long-duration fixed-income securities. The continued changes could result in a reduction in the long-term rate of return on the Pension Plan assets and increase future pension expense. The long-term weighted average target asset allocations are as follows: | |||||||||||||||||
December 31, 2014 | |||||||||||||||||
U.S. large capitalization equities | 17 | % | |||||||||||||||
U.S. small capitalization equities | 4 | ||||||||||||||||
International equities | 4 | ||||||||||||||||
U.S. long-duration fixed income | 75 | ||||||||||||||||
Total | 100 | % | |||||||||||||||
The actual allocation of the assets in the Pension Plan at December 31, 2014 and 2013 were as follows: | |||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
U.S. large capitalization equities | 30 | % | 33 | % | |||||||||||||
U.S. small capitalization equities | 6 | 7 | |||||||||||||||
International equities | 7 | 8 | |||||||||||||||
U.S. long-duration fixed income | 54 | 49 | |||||||||||||||
High yield fixed income | — | 3 | |||||||||||||||
Below Investment Grade Corporate Fixed Income | 3 | — | |||||||||||||||
Total | 100 | % | 100 | % |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||
Commitments and Contingencies | Commitments and Contingencies | ||||||||||||
Operating Lease Commitments | |||||||||||||
We lease office and warehouse facilities and equipment under various operating leases. Facility leases generally include renewal options. Rent expense was as follows (table in millions): | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Rent expense | $ | 361 | $ | 328 | $ | 312 | |||||||
Sublease proceeds | (2 | ) | (2 | ) | (4 | ) | |||||||
Net rent expense | $ | 359 | $ | 326 | $ | 308 | |||||||
Our future operating lease commitments as of December 31, 2014 are as follows (table in millions): | |||||||||||||
2015 | $ | 328 | |||||||||||
2016 | 281 | ||||||||||||
2017 | 224 | ||||||||||||
2018 | 162 | ||||||||||||
2019 | 117 | ||||||||||||
Thereafter | 826 | ||||||||||||
Total minimum lease payments | $ | 1,938 | |||||||||||
We sublet certain of our office facilities. Expected future non-cancelable sublease proceeds range from approximately $1 million to $3 million per year for the next five years with total sublease proceeds of $9 million as of December 31, 2014. | |||||||||||||
Outstanding Purchase Orders | |||||||||||||
At December 31, 2014, we had outstanding purchase orders aggregating approximately $2.9 billion. The purchase orders are for manufacturing and non-manufacturing related goods and services. While the purchase orders are generally cancelable without penalty, certain vendor agreements provide for percentage-based cancellation fees or minimum restocking charges based on the nature of the product or service. | |||||||||||||
Guarantees and Indemnification Obligations | |||||||||||||
EMC’s subsidiaries have entered into arrangements with financial institutions for such institutions to provide guarantees for rent, taxes, insurance, leases, performance bonds, bid bonds and customs duties aggregating $125 million as of December 31, 2014. The guarantees vary in length of time. In connection with these arrangements, we have agreed to guarantee substantially all of the guarantees provided by these financial institutions. EMC and certain of its subsidiaries have also entered into arrangements with financial institutions in order to facilitate the management of currency risk. EMC has agreed to guarantee the obligations of its subsidiaries under these arrangements. | |||||||||||||
We enter into agreements in the ordinary course of business with, among others, customers, resellers, original equipment manufacturers (“OEMs”), systems integrators and distributors. Most of these agreements require us to indemnify the other party against third-party claims alleging that an EMC product infringes a patent and/or copyright. Certain agreements in which we grant limited licenses to specific EMC-trademarks require us to indemnify the other party against third-party claims alleging that the use of the licensed trademark infringes a third-party trademark. Certain of these agreements require us to indemnify the other party against certain claims relating to the loss or processing of data, to real or tangible personal property damage, personal injury or the acts or omissions of EMC, its employees, agents or representatives. In addition, from time to time, we have made certain guarantees regarding the performance of our systems to our customers. We have also made certain guarantees for obligations of affiliated third parties. | |||||||||||||
We have agreements with certain vendors, financial institutions, lessors and service providers pursuant to which we have agreed to indemnify the other party for specified matters, such as acts and omissions of EMC, its employees, agents or representatives. | |||||||||||||
We have procurement or license agreements with respect to technology that is used in our products and agreements in which we obtain rights to a product from an OEM. Under some of these agreements, we have agreed to indemnify the supplier for certain claims that may be brought against such party with respect to our acts or omissions relating to the supplied products or technologies. | |||||||||||||
We have agreed to indemnify the directors, executive officers and certain other officers of EMC and our subsidiaries, to the extent legally permissible, against all liabilities reasonably incurred in connection with any action in which such individual may be involved by reason of such individual being or having been a director or officer. | |||||||||||||
In connection with certain acquisitions, we have agreed to indemnify the current and former directors, officers and employees of the acquired company in accordance with the acquired company’s by-laws and charter in effect immediately prior to the acquisition or in accordance with indemnification or similar agreements entered into by the acquired company and such persons. In a substantial majority of instances, we have maintained the acquired company’s directors’ and officers’ insurance, which should enable us to recover a portion of any future amounts paid. These indemnities vary in length of time. | |||||||||||||
Based upon our historical experience and information known as of December 31, 2014, we believe our liability on the above guarantees and indemnities at December 31, 2014 is not material. | |||||||||||||
Litigation | |||||||||||||
We are involved in a variety of claims, demands, suits, investigations and proceedings that arise from time to time relating to matters incidental to the ordinary course of our business, including actions with respect to contracts, intellectual property, product liability, employment, benefits and securities matters. As required by authoritative guidance, we have estimated the amount of probable losses that may result from all currently pending matters, and such amounts are reflected in our consolidated financial statements. These recorded amounts are not material to our consolidated financial position or results of operations and no additional material losses related to these pending matters are reasonably possible. While it is not possible to predict the outcome of these matters with certainty, we do not expect the results of any of these actions to have a material adverse effect on our business, results of operations or financial condition. Because litigation is inherently unpredictable, however, the actual amounts of loss may prove to be larger or smaller than the amounts reflected in our consolidated financial statements, and we could incur judgments or enter into settlements of claims that could adversely affect our operating results or cash flows in a particular period. |
Stockholders_Equity
Stockholders' Equity | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||
Stockholders' Equity Note [Abstract] | ||||||||||||||||||||||||
Shareholders' Equity | Shareholders’ Equity | |||||||||||||||||||||||
Net Income Per Share | ||||||||||||||||||||||||
The reconciliation from basic to diluted earnings per share for both the numerators and denominators is as follows (table in millions): | ||||||||||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||||||||
Numerator: | ||||||||||||||||||||||||
Net income attributable to EMC Corporation | $ | 2,714 | $ | 2,889 | $ | 2,733 | ||||||||||||||||||
Incremental dilution from VMware | (7 | ) | (8 | ) | (10 | ) | ||||||||||||||||||
Net income – dilution attributable to EMC Corporation | $ | 2,707 | $ | 2,881 | $ | 2,723 | ||||||||||||||||||
Denominator: | ||||||||||||||||||||||||
Weighted average shares, basic | 2,028 | 2,074 | 2,093 | |||||||||||||||||||||
Weighted average common stock equivalents | 26 | 28 | 40 | |||||||||||||||||||||
Assumed conversion of the 2013 Notes and associated warrants | 5 | 58 | 73 | |||||||||||||||||||||
Weighted average shares, diluted | 2,059 | 2,160 | 2,206 | |||||||||||||||||||||
Due to the cash settlement feature of the principal amount of the 2013 Notes, we only included the impact of the premium feature in our diluted earnings per share calculation when the 2013 Notes were convertible due to maturity or when the average stock price exceeded the conversion price of the 2013 Notes. | ||||||||||||||||||||||||
Concurrent with the issuance of the 2013 Notes, we also entered into separate transactions in which we sold warrants to acquire, subject to customary anti-dilution adjustments, approximately 215 million shares of our common stock at an exercise price of approximately $19.55 per share of our common stock. Approximately half of the associated warrants were exercised during the year ended December 31, 2012. The remaining 109 million warrants were exercised between February 18, 2014 and March 17, 2014 and were settled with 29 million shares of our common stock. As such, we included the impact of the remaining outstanding sold warrants in our diluted earnings per share calculation during the year ended December 31, 2013. | ||||||||||||||||||||||||
Restricted stock awards, restricted stock units and options to acquire 2 million, 4 million and 4 million shares of our common stock for the years ended December 31, 2014, 2013 and 2012, respectively, were excluded from the calculation of diluted earnings per share because they were antidilutive. The incremental dilution from VMware represents the impact of VMware’s dilutive securities on EMC’s consolidated diluted net income per share and is calculated by multiplying the difference between VMware’s basic and diluted earnings per share by the number of VMware shares owned by EMC. | ||||||||||||||||||||||||
EMC Repurchases of Common Stock | ||||||||||||||||||||||||
We utilize both authorized and unissued shares (including repurchased shares) for all issuances under our equity plans. Our Board of Directors authorized the repurchase of 250 million shares of our common stock in February 2013 and an additional 250 million shares of our common stock in December 2014. For the year ended December 31, 2014, we spent $3.0 billion to repurchase 107 million shares of our common stock. Of the 500 million shares authorized for repurchase, we have repurchased 201 million shares at a total cost of $5.4 billion, leaving a remaining balance of 299 million shares authorized for future repurchases. We spent approximately $3.0 billion in the year ended December 31, 2013 on the repurchase of stock. | ||||||||||||||||||||||||
VMware Repurchase of Common Stock | ||||||||||||||||||||||||
The following table summarizes stock repurchase authorizations in the years ended December 31, 2014, 2013 and 2012 (amounts in table in millions): | ||||||||||||||||||||||||
Month Authorized | Amount Authorized | Expiration Date | Status | |||||||||||||||||||||
Aug-14 | $ | 1,000 | End of 2016 | Open | ||||||||||||||||||||
Aug-13 | 700 | End of 2015 | Completed in Q4’14 | |||||||||||||||||||||
Nov-12 | 250 | End of 2014 | Completed in Q4’13 | |||||||||||||||||||||
Feb-12 | 600 | End of 2013 | Completed in Q2’13 | |||||||||||||||||||||
From time to time, VMware repurchases stock pursuant to the August 2014 authorizations in open market transactions or privately negotiated transactions as permitted by securities laws and other legal requirements. All shares repurchased under VMware’s stock repurchase programs are retired. On January 27, 2015, VMware’s Board of Directors authorized the repurchase of up to an additional $1.0 billion of its common stock through the end of 2017. | ||||||||||||||||||||||||
The following table summarizes stock repurchase activity in the years ended December 31, 2014, 2013 and 2012 (table in millions, except per share amounts): | ||||||||||||||||||||||||
For the Year Ended December 31, | ||||||||||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||||||||
Aggregate purchase price | $ | 700 | $ | 508 | $ | 468 | ||||||||||||||||||
Class A common shares repurchased | 8 | 7 | 5 | |||||||||||||||||||||
Weighted-average price per share | $ | 91.61 | $ | 76.58 | $ | 91.1 | ||||||||||||||||||
The amount of repurchased shares includes commissions and was classified as a reduction to additional paid-in capital. As of December 31, 2014, the cumulative authorized amount remaining for repurchase was $960 million. | ||||||||||||||||||||||||
Cash Dividend on Common Stock | ||||||||||||||||||||||||
In May 2013, our Board of Directors approved the initiation of a quarterly cash dividend to EMC shareholders of $0.10 per share of common stock. On April 17, 2014, our Board of Directors approved an increase in the quarterly cash dividend paid to EMC shareholders to $0.115 per share of common stock. | ||||||||||||||||||||||||
Our Board of Directors declared the following dividends during the periods presented: | ||||||||||||||||||||||||
Declaration Date | Dividend Per Share | Record Date | Total Amount (in millions) | Payment Date | ||||||||||||||||||||
Fiscal Year 2014: | ||||||||||||||||||||||||
February 6, 2014 | $ | 0.1 | April 1, 2014 | $ | 209 | April 23, 2014 | ||||||||||||||||||
April 17, 2014 | $ | 0.115 | July 1, 2014 | $ | 237 | July 23, 2014 | ||||||||||||||||||
July 30, 2014 | $ | 0.115 | October 1, 2014 | $ | 239 | October 23, 2014 | ||||||||||||||||||
9-Dec-14 | $ | 0.115 | January 2, 2015 | $ | 234 | January 23, 2015 | ||||||||||||||||||
Fiscal Year 2013: | ||||||||||||||||||||||||
May 30, 2013 | $ | 0.1 | July 1, 2013 | $ | 212 | July 23, 2013 | ||||||||||||||||||
August 1, 2013 | $ | 0.1 | October 1, 2013 | $ | 210 | October 23, 2013 | ||||||||||||||||||
December 12, 2013 | $ | 0.1 | January 8, 2014 | $ | 206 | January 23, 2014 | ||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) | ||||||||||||||||||||||||
Changes in accumulated other comprehensive income (loss), which is presented net of tax, for the years ended December 31, 2014 and 2013 consist of the following (table in millions): | ||||||||||||||||||||||||
Foreign Currency Translation Adjustments | Unrealized Net Gains on Investments | Unrealized Net Losses on Derivatives | Recognition of Actuarial Net Loss from Pension and Other Postretirement Plans | Accumulated Other Comprehensive Income Attributable to the Non-controlling Interest in VMware, Inc. | Total | |||||||||||||||||||
Balance as of January 1, 2013(a) | $ | (9 | ) | $ | 64 | $ | (109 | ) | $ | (153 | ) | $ | (1 | ) | $ | (208 | ) | |||||||
Other comprehensive income (loss) before reclassifications | (44 | ) | (22 | ) | 13 | 34 | — | (19 | ) | |||||||||||||||
Net losses (gains) reclassified from accumulated other comprehensive income | — | (11 | ) | (10 | ) | 9 | — | (12 | ) | |||||||||||||||
Net current period other comprehensive income (loss) | (44 | ) | (33 | ) | 3 | 43 | — | (31 | ) | |||||||||||||||
Balance as of December 31, 2013(b) | (53 | ) | 31 | (106 | ) | (110 | ) | (1 | ) | (239 | ) | |||||||||||||
Other comprehensive income (loss) before reclassifications | (135 | ) | 57 | 24 | (22 | ) | — | (76 | ) | |||||||||||||||
Net losses (gains) reclassified from accumulated other comprehensive income | — | (39 | ) | (18 | ) | 6 | — | (51 | ) | |||||||||||||||
Net current period other comprehensive income (loss) | (135 | ) | 18 | 6 | (16 | ) | — | (127 | ) | |||||||||||||||
Balance as of December 31, 2014(c) | $ | (188 | ) | $ | 49 | $ | (100 | ) | $ | (126 | ) | $ | (1 | ) | $ | (366 | ) | |||||||
(a) | Net of taxes (benefits) of $37 million for unrealized net gains on investments, $(67) million for unrealized net losses on derivatives and $(87) million for actuarial net loss on pension plans. | |||||||||||||||||||||||
(b) | Net of taxes (benefits) of $18 million for unrealized net gains on investments, $(66) million for unrealized net losses on derivatives and $(61) million for actuarial net loss on pension plans. | |||||||||||||||||||||||
(c) | Net of taxes (benefits) of $31 million for unrealized net gains on investments, $(64) million for unrealized net losses on derivatives and $(70) million for actuarial net loss on pension plans. | |||||||||||||||||||||||
The amounts reclassified out of accumulated other comprehensive income (loss) for the years ended December 31, 2014 and 2013 is as follows (table in millions): | ||||||||||||||||||||||||
For the Year Ended | ||||||||||||||||||||||||
Accumulated Other Comprehensive Income Components | 31-Dec-14 | 31-Dec-13 | Impacted Line Item on | |||||||||||||||||||||
Consolidated Income Statements | ||||||||||||||||||||||||
Net gain on investments: | $ | 62 | $ | 17 | Investment income | |||||||||||||||||||
(23 | ) | (6 | ) | Provision for income tax | ||||||||||||||||||||
Net of tax | $ | 39 | $ | 11 | ||||||||||||||||||||
Net gain on derivatives: | ||||||||||||||||||||||||
Foreign exchange contracts | $ | 39 | $ | 12 | Product sales revenue | |||||||||||||||||||
Foreign exchange contracts | (10 | ) | — | Cost of product sales | ||||||||||||||||||||
Interest rate swap | (11 | ) | — | Other interest expense | ||||||||||||||||||||
Total net gain on derivatives before tax | 18 | 12 | ||||||||||||||||||||||
— | (2 | ) | Provision for income tax | |||||||||||||||||||||
Net of tax | $ | 18 | $ | 10 | ||||||||||||||||||||
Net loss from pension and other postretirement plans | $ | (9 | ) | $ | (15 | ) | Selling, general and administrative expense | |||||||||||||||||
3 | 6 | Benefit for income tax | ||||||||||||||||||||||
Net of tax | $ | (6 | ) | $ | (9 | ) | ||||||||||||||||||
EMC Preferred Stock | ||||||||||||||||||||||||
Our preferred stock may be issued from time to time in one or more series, with such terms as our Board of Directors may determine, without further action by our shareholders. |
StockBased_Compensation
Stock-Based Compensation | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||||||||||||
Stock-Based Compensation | Stock-Based Compensation | ||||||||||||
EMC Equity Plans | |||||||||||||
The EMC Corporation Amended and Restated 2003 Stock Plan (the “2003 Plan”) provides for the grant of stock options, stock appreciation rights, restricted stock and restricted stock units. The exercise price for a stock option shall not be less than 100% of the fair market value of our common stock on the date of grant. Options generally become exercisable in annual installments over a period of five years after the date of grant and expire ten years after the date of grant. Incentive stock options will expire no later than ten years after the date of grant. Restricted stock is common stock that is subject to a risk of forfeiture or other restrictions that will lapse upon satisfaction of specified conditions. Restricted stock units represent the right to receive shares of common stock in the future, with the right to future delivery of the shares subject to a risk of forfeiture or other restrictions that will lapse upon satisfaction of specified conditions. Grants of restricted stock awards or restricted stock units that vest only by the passage of time will not vest fully in less than two years after the date of grant, except for grants to non-employee Directors that are not subject to this minimum two-year vesting requirement. The 2003 Plan allows us to grant up to 420 million shares of common stock. We recognize restricted stock awards and restricted stock units against the 2003 Plan share reserve as two shares for every one share issued in connection with such awards. | |||||||||||||
In addition to the 2003 Plan, we have four other stock option plans (the “1985 Plan,” the “1993 Plan,” the “2001 Plan” and the “1992 Directors Plan”). In May 2007, these four plans were consolidated into the 2003 Plan such that all future grants will be granted under the 2003 Plan and shares that are not issued as a result of cancellations, expirations or forfeitures, will become available for grant under the 2003 Plan. | |||||||||||||
A total of 982 million shares of common stock have been reserved for issuance under the above five plans. At December 31, 2014, there were an aggregate of 41 million shares of common stock available for issuance pursuant to future grants under the 2003 Plan. | |||||||||||||
We have, in connection with the acquisition of various companies, assumed the stock option plans of these companies. We do not intend to make future grants under any of such plans. | |||||||||||||
EMC Employee Stock Purchase Plan | |||||||||||||
Under our Amended and Restated 1989 Employee Stock Purchase Plan (the “1989 Plan”), eligible employees may purchase shares of common stock through payroll deductions at 85% of the fair market value at the time of exercise. During the year ended December 31, 2013, we amended the Plan to adjust the grant and exercise dates. Options to purchase shares are granted twice yearly, on February 1 and August 1, and are exercisable on the succeeding July 31 and January 31, respectively, each year. A total of 183 million shares of common stock have been reserved for issuance under the 1989 Plan. The following table summarizes the 1989 Plan activity in the years ended December 31, 2014, 2013 and 2012 (table in millions, except per share amounts): | |||||||||||||
For the Year Ended | |||||||||||||
December 31, 2014 | December 31, 2013 | December 31, 2012 | |||||||||||
Cash proceeds | $ | 186 | $ | 82 | $ | 154 | |||||||
Common shares purchased | 8 | 4 | 7 | ||||||||||
Weighted-average price per share | $ | 22.44 | $ | 20.08 | $ | 21.65 | |||||||
As of December 31, 2014, $84 million of ESPP withholdings were recorded as a liability on the consolidated balance sheet for the next purchase that occurred in January 2015. | |||||||||||||
EMC Stock Options | |||||||||||||
The following table summarizes our option activity under all equity plans since January 1, 2012 (shares in millions): | |||||||||||||
Number of | Weighted Average | ||||||||||||
Shares | Exercise Price | ||||||||||||
(per share) | |||||||||||||
Outstanding, January 1, 2012 | 112 | $ | 13.69 | ||||||||||
Options granted relating to business acquisitions | 2 | 1.54 | |||||||||||
Granted | 1 | 26.8 | |||||||||||
Forfeited | (2 | ) | 13.75 | ||||||||||
Expired | (1 | ) | 14.19 | ||||||||||
Exercised | (35 | ) | 11.65 | ||||||||||
Outstanding, December 31, 2012 | 77 | 14.39 | |||||||||||
Options granted relating to business acquisitions | 1 | 3.29 | |||||||||||
Granted | — | — | |||||||||||
Forfeited | (1 | ) | 13.36 | ||||||||||
Expired | — | — | |||||||||||
Exercised | (20 | ) | 13.1 | ||||||||||
Outstanding, December 31, 2013 | 57 | 14.56 | |||||||||||
Options granted relating to business acquisitions | 8 | 0.62 | |||||||||||
Granted | — | — | |||||||||||
Forfeited | (1 | ) | 13.55 | ||||||||||
Expired | — | — | |||||||||||
Exercised | (24 | ) | 13.19 | ||||||||||
Outstanding, December 31, 2014 | 40 | 12.68 | |||||||||||
Exercisable, December 31, 2014 | 31 | 15.27 | |||||||||||
Vested and expected to vest, December 31, 2014 | 39 | $ | 13.06 | ||||||||||
At December 31, 2014, the weighted-average remaining contractual term was 3.0 years and the aggregate intrinsic value was $447 million for the 31 million exercisable shares. For the 39 million shares vested and expected to vest at December 31, 2014, the weighted-average remaining contractual term was 2.9 years and the aggregate intrinsic value was $651 million. The intrinsic value is based on our closing stock price of $29.74 as of December 31, 2014, which would have been received by the option holders had all in-the-money options been exercised as of that date. The total pre-tax intrinsic values of options exercised in 2014, 2013 and 2012 were $353 million, $240 million and $518 million, respectively. Cash proceeds from the exercise of stock options were $317 million, $260 million and $407 million in 2014, 2013 and 2012, respectively. Income tax benefits realized from the exercise of stock options in 2014, 2013 and 2012 were $61 million, $45 million and $97 million, respectively. | |||||||||||||
EMC Restricted Stock and Restricted Stock Units | |||||||||||||
Our restricted stock awards and units are valued based on our stock price on the grant date. Our restricted stock awards and units have various vesting terms from the date of grant, including pro rated vesting over three or four years, cliff vesting at the end of three or five years with acceleration for achieving specified performance criteria and vesting on various dates contingent on achieving specified performance criteria. For awards with performance conditions, management evaluates the criteria in each grant to determine the probability that the performance condition will be achieved. | |||||||||||||
The following table summarizes our restricted stock and restricted stock unit activity since January 1, 2012 (shares in millions): | |||||||||||||
Number of | Weighted Average | ||||||||||||
Shares | Grant Date | ||||||||||||
Fair Value | |||||||||||||
Restricted stock and restricted stock units at January 1, 2012 | 46 | $ | 21.1 | ||||||||||
Granted | 21 | 26.57 | |||||||||||
Vested | (16 | ) | 18.92 | ||||||||||
Forfeited | (4 | ) | 23.09 | ||||||||||
Outstanding, December 31, 2012 | 47 | 24.39 | |||||||||||
Granted | 20 | 25.55 | |||||||||||
Vested | (15 | ) | 22.61 | ||||||||||
Forfeited | (4 | ) | 24.8 | ||||||||||
Outstanding, December 31, 2013 | 48 | 25.43 | |||||||||||
Granted | 23 | 27.65 | |||||||||||
Vested | (14 | ) | 24.89 | ||||||||||
Forfeited | (4 | ) | 25.63 | ||||||||||
Restricted stock and restricted stock units at December 31, 2014 | 53 | $ | 26.5 | ||||||||||
The total intrinsic values of restricted stock and restricted stock units that vested in 2014, 2013 and 2012 were $388 million, $404 million and $421 million, respectively. As of December 31, 2014, restricted stock and restricted stock units representing 53 million shares were outstanding and unvested, with an aggregate intrinsic value of $1,570 million. These shares and units are scheduled to vest through 2019. Of the total shares of restricted stock and restricted stock units outstanding, 45 million shares and units will vest upon fulfilling service conditions, of which vesting for 9 million shares and units will accelerate upon achieving performance conditions. The remaining 8 million shares and units will vest only if certain performance conditions are achieved. | |||||||||||||
VMware Equity Plans | |||||||||||||
In June 2007, VMware adopted its 2007 Equity and Incentive Plan (the “2007 Plan”). In May 2009, VMware amended its 2007 Plan to increase the number of shares available for issuance by 20 million shares for total shares available for issuance of 100 million. In May 2013, VMware further amended the 2007 Plan to increase the number of shares available for issuance by 13 million shares. The number of shares underlying outstanding equity awards that VMware assumes in the course of business acquisitions are also added to the 2007 Plan reserve on an as-converted basis. VMware has assumed 4 million shares, which accordingly have been added to the 2007 Plan reserve. | |||||||||||||
Awards under the 2007 Plan may be in the form of stock options or other stock-based awards, including awards of restricted stock units. The exercise price for a stock option awarded under the 2007 Plan shall not be less than 100% of the fair market value of VMware Class A common stock on the date of grant. Most options granted under the 2007 Plan vest 25% after the first year and then monthly thereafter over the following three years and expire between six and seven years from the date of grant. Most restricted stock grants made under the 2007 Plan have a three-year to four-year period over which they vest and vest 25% the first year and semi-annually thereafter. VMware’s Compensation and Corporate Governance Committee determines the vesting schedule for all equity awards. VMware utilizes both authorized and unissued shares to satisfy all shares issued under the 2007 Plan. At December 31, 2014, there were an aggregate of 18 million shares of common stock available for issuance pursuant to future grants under the 2007 Plan. | |||||||||||||
VMware Employee Stock Purchase Plan | |||||||||||||
In June 2007, VMware adopted its 2007 Employee Stock Purchase Plan (the “ESPP”), which is intended to be qualified under Section 423 of the Internal Revenue Code. In May 2013, VMware amended its ESPP to increase the number of shares available for issuance by 8 million shares. Under the ESPP, eligible VMware employees are granted options to purchase shares at the lower of 85% of the fair market value of the stock at the time of grant or 85% of the fair market value at the time of exercise. Options to purchase shares are generally granted twice yearly on February 1 and August 1 and exercisable on the succeeding July 31 and January 31, respectively, of each year. As of December 31, 2014, 6 million shares of VMware Class A common stock were available for issuance pursuant to future grants under the ESPP. | |||||||||||||
The following table summarizes ESPP activity in the years ended December 31, 2014, 2013 and 2012 (table in millions, except per share amounts): | |||||||||||||
For the Year Ended | |||||||||||||
December 31, 2014 | December 31, 2013 | December 31, 2012 | |||||||||||
Cash proceeds | $ | 80 | $ | 76 | $ | 69 | |||||||
Class A common shares purchased | 1 | 1 | 1 | ||||||||||
Weighted-average price per share | $ | 73.21 | $ | 65.97 | $ | 77.34 | |||||||
As of December 31, 2014, $46 million of ESPP withholdings were recorded as a liability on the consolidated balance sheet for the next purchase that occurred in January 2015. | |||||||||||||
VMware Stock Options | |||||||||||||
The following table summarizes activity since January 1, 2012 for VMware employees in VMware stock options (shares in millions): | |||||||||||||
Number of | Weighted Average | ||||||||||||
Shares | Exercise Price | ||||||||||||
(per share) | |||||||||||||
Outstanding, January 1, 2012 | 16 | $ | 35.27 | ||||||||||
Granted | 1 | 4.67 | |||||||||||
Forfeited | (1 | ) | 42.07 | ||||||||||
Exercised | (6 | ) | 30.44 | ||||||||||
Outstanding, December 31, 2012 | 10 | 34.36 | |||||||||||
Granted | 1 | 71.53 | |||||||||||
Exercised | (5 | ) | 28.12 | ||||||||||
Outstanding, December 31, 2013 | 6 | 44.12 | |||||||||||
Granted | 2 | 50.91 | |||||||||||
Exercised | (2 | ) | 35.58 | ||||||||||
Outstanding, December 31, 2014 | 6 | 50.54 | |||||||||||
Exercisable, December 31, 2014 | 3 | 37.4 | |||||||||||
Vested and expected to vest | 6 | $ | 48.57 | ||||||||||
The above table includes stock options granted in conjunction with unvested stock options assumed in business combinations. As a result, the weighted-average exercise price per share may vary from the VMware stock price at time of grant. | |||||||||||||
As of December 31, 2014, for the VMware stock options, the weighted-average remaining contractual term was 2.1 years and the aggregate intrinsic value was $128 million for the 3 million exercisable shares. For the 6 million options vested and expected to vest at December 31, 2014, the weighted-average remaining contractual term was 4.3 years years and the aggregate intrinsic value was $204 million. These aggregate intrinsic values represent the total pre-tax intrinsic values based on VMware’s closing stock price of $82.52 as of December 31, 2014, which would have been received by the option holders had all in-the-money options been exercised as of that date. The options exercised in 2014, 2013 and 2012 had a pre-tax intrinsic value of $147 million, $256 million and $443 million, respectively. The total fair value of VMware stock options that vested during the years ended December 31, 2014, 2013 and 2012 was $64 million, $60 million and $72 million, respectively. | |||||||||||||
VMware Restricted Stock | |||||||||||||
The following table summarizes restricted stock activity since January 1, 2012 (units in millions): | |||||||||||||
Number of | Weighted Average | ||||||||||||
Units | Grant Date | ||||||||||||
Fair Value | |||||||||||||
(per unit) | |||||||||||||
Restricted stock at January 1, 2012 | 10 | $ | 72.74 | ||||||||||
Granted | 8 | 101.73 | |||||||||||
Vested | (4 | ) | 69.01 | ||||||||||
Forfeited | (2 | ) | 81.53 | ||||||||||
Outstanding, December 31, 2012 | 12 | 91.93 | |||||||||||
Granted | 7 | 76.2 | |||||||||||
Vested | (4 | ) | 83.21 | ||||||||||
Forfeited | (2 | ) | 90.55 | ||||||||||
Outstanding, December 31, 2013 | 13 | 85.85 | |||||||||||
Granted | 6 | 92.82 | |||||||||||
Vested | (5 | ) | 86.27 | ||||||||||
Forfeited | (1 | ) | 88.03 | ||||||||||
Outstanding, December 31, 2014 | 13 | $ | 88.88 | ||||||||||
As of December 31, 2014, restricted stock representing 13 million shares of VMware’s Class A common stock were outstanding, with an aggregate intrinsic value of $1,039 million based on VMware’s closing price as of December 31, 2014. The total fair value of VMware restricted stock awards that vested during the years ended December 31, 2014, 2013 and 2012 was $480 million, $340 million and $347 million, respectively. | |||||||||||||
Stock-Based Compensation Expense | |||||||||||||
The following tables summarize the components of total stock-based compensation expense included in our consolidated income statements in 2014, 2013 and 2012 (in millions): | |||||||||||||
Year Ended December 31, 2014 | |||||||||||||
Stock Options | Restricted | Total Stock-Based | |||||||||||
Stock | Compensation | ||||||||||||
Cost of product sales | $ | 16 | $ | 38 | $ | 54 | |||||||
Cost of services | 20 | 72 | 92 | ||||||||||
Research and development | 79 | 303 | 382 | ||||||||||
Selling, general and administrative | 78 | 415 | 493 | ||||||||||
Stock-based compensation expense before income taxes | 193 | 828 | 1,021 | ||||||||||
Income tax benefit | 45 | 179 | 224 | ||||||||||
Total stock-based compensation, net of tax | $ | 148 | $ | 649 | $ | 797 | |||||||
Year Ended December 31, 2013 | |||||||||||||
Stock Options | Restricted | Total Stock-Based | |||||||||||
Stock | Compensation | ||||||||||||
Cost of product sales | $ | 19 | $ | 29 | $ | 48 | |||||||
Cost of services | 15 | 61 | 76 | ||||||||||
Research and development | 75 | 282 | 357 | ||||||||||
Selling, general and administrative | 82 | 372 | 454 | ||||||||||
Stock-based compensation expense before income taxes | 191 | 744 | 935 | ||||||||||
Income tax benefit | 56 | 170 | 226 | ||||||||||
Total stock-based compensation, net of tax | $ | 135 | $ | 574 | $ | 709 | |||||||
Year Ended December 31, 2012 | |||||||||||||
Stock Options | Restricted | Total Stock-Based | |||||||||||
Stock | Compensation | ||||||||||||
Cost of product sales | $ | 22 | $ | 30 | $ | 52 | |||||||
Cost of services | 21 | 53 | 74 | ||||||||||
Research and development | 88 | 236 | 324 | ||||||||||
Selling, general and administrative | 131 | 339 | 470 | ||||||||||
Stock-based compensation expense before income taxes | 262 | 658 | 920 | ||||||||||
Income tax benefit | 68 | 162 | 230 | ||||||||||
Total stock-based compensation, net of tax | $ | 194 | $ | 496 | $ | 690 | |||||||
Stock-based compensation expense includes $57 million, $54 million and $52 million of expense associated with our employee stock purchase plans for 2014, 2013 and 2012, respectively. | |||||||||||||
The table below presents the net change in amounts capitalized or accrued in 2014 and 2013 for the following items (in millions): | |||||||||||||
Increased (decreased) | Increased (decreased) | ||||||||||||
during the year ended | during the year ended | ||||||||||||
December 31, 2014 | December 31, 2013 | ||||||||||||
Accrued expenses (accrued warranty expenses) | $ | — | $ | (1 | ) | ||||||||
Other assets | (19 | ) | 2 | ||||||||||
As of December 31, 2014, the total unrecognized after-tax compensation cost for stock options, restricted stock and restricted stock units was $1,515 million. This non-cash expense will be recognized through 2019 with a weighted-average remaining period of 1.5 years. | |||||||||||||
Fair Value of EMC Stock Options | |||||||||||||
Apart from options issued through business acquisitions which are discussed in Note C, there were no stock options granted during the years ended December 31, 2014 and 2013. The fair value of each option granted during the year ended December 31, 2012 was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions: | |||||||||||||
EMC Stock Options | For the Year Ended December 31, 2012 | ||||||||||||
Dividend yield | None | ||||||||||||
Expected volatility | 34.3 | % | |||||||||||
Risk-free interest rate | 0.8 | % | |||||||||||
Expected term (in years) | 5.2 | ||||||||||||
Weighted-average fair value at grant date | $ | 8.56 | |||||||||||
For all stock options granted in 2012, volatility was based on an analysis of historical stock prices and implied volatilities from traded options in our stock. We use EMC historical data to estimate the expected term of options granted within the valuation model. EMC’s expected dividend yield input was zero as it had not historically paid cash dividends on its common stock. The risk-free interest rate was based on a U.S. Treasury instrument whose term is consistent with the expected term of the stock options. | |||||||||||||
Fair Value of VMware Options | |||||||||||||
The fair value of each option to acquire VMware Class A common stock granted during the years ended December 31, 2014, 2013 and 2012 was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions: | |||||||||||||
For the Year Ended | |||||||||||||
December 31, | |||||||||||||
VMware Stock Options | 2014 | 2013 | 2012 | ||||||||||
Dividend yield | None | None | None | ||||||||||
Expected volatility | 36.2 | % | 38.5 | % | 35.8 | % | |||||||
Risk-free interest rate | 0.9 | % | 0.9 | % | 0.3 | % | |||||||
Expected term (in years) | 3.2 | 3.6 | 2.6 | ||||||||||
Weighted-average fair value at grant date | $ | 48.47 | $ | 29.47 | $ | 80.45 | |||||||
For the Year Ended | |||||||||||||
December 31, | |||||||||||||
VMware Employee Stock Purchase Plan | 2014 | 2013 | 2012 | ||||||||||
Dividend yield | None | None | None | ||||||||||
Expected volatility | 32.3 | % | 32.9 | % | 37.8 | % | |||||||
Risk-free interest rate | 0.1 | % | 0.1 | % | 0.1 | % | |||||||
Expected term (in years) | 0.5 | 0.5 | 0.5 | ||||||||||
Weighted-average fair value at grant date | $ | 20.71 | $ | 20.45 | $ | 23.36 | |||||||
The weighted-average grant date fair value of VMware stock options can fluctuate from period to period primarily due to higher valued options assumed through business combinations with exercise prices lower than the fair market value of VMware’s stock on the date of grant. | |||||||||||||
For all equity awards granted during the years ended 2014, 2013 and 2012, volatility was based on an analysis of historical stock prices and implied volatilities of VMware’s Class A common stock or those of publicly-traded companies with similar characteristics, as applicable. The expected term is based on historical exercise patterns and post-vesting termination behavior, the term of the purchase period for grants made under the ESPP, or the weighted-average remaining term for options assumed in acquisitions. VMware’s expected dividend yield input was zero as it has not historically paid, nor expects in the future to pay, cash dividends on its common stock. The risk-free interest rate was based on a U.S. Treasury instrument whose term is consistent with the expected term of the stock options. |
Restructuring_and_AcquisitionR
Restructuring and Acquisition-Related Charges | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Restructuring and Related Activities [Abstract] | ||||||||||||||||
Restructuring and Acquisition-Related Charges | Restructuring and Acquisition-Related Charges | |||||||||||||||
In 2014, 2013 and 2012, we incurred restructuring and acquisition-related charges of $239 million, $224 million and $110 million, respectively. In 2014, EMC incurred $210 million of restructuring charges, primarily related to our current year restructuring programs, and $6 million of charges in connection with acquisitions for financial, advisory, legal and accounting services. In 2013, EMC incurred $139 million of restructuring charges, primarily related to our 2013 restructuring programs, and $8 million of charges in connection with acquisitions for financial, advisory, legal and accounting services. In 2012, EMC incurred $101 million of restructuring charges, primarily related to our 2012 restructuring program, and $9 million of charges in connection with acquisitions for financial, advisory, legal and accounting services. In 2014, VMware incurred $18 million of restructuring charges related to workforce reductions as part of its current year restructuring program and $7 million of charges in connection with acquisitions for financial, advisory, legal and accounting services. In 2013, VMware incurred $54 million of restructuring charges related to workforce reductions as part of its 2013 restructuring program and $5 million of charges in connection with acquisitions for financial, advisory, legal and accounting services. In addition, VMware incurred a benefit of $2 million and a charge of $18 million primarily related to impairment charges related to its business realignments in 2014 and 2013, respectively. VMware had no restructuring charges in 2012. | ||||||||||||||||
During 2014, 2013 and 2012, EMC implemented restructuring programs to re-balance the business and streamline its operations which will result or have resulted in workforce reductions of approximately 2,100, 1,900 and 1,100 positions, respectively. The actions impact positions around the globe covering our Information Storage, RSA Information Security, Enterprise Content Division and Pivotal segments. All of these actions are expected to be completed or were completed within a year of the start of each program. | ||||||||||||||||
During 2014, VMware eliminated approximately 180 positions across all major functional groups and geographies to streamline its operations. During 2013, VMware approved and initiated a business realignment plan to streamline its operations. The plan included the elimination of approximately 710 positions across all major functional groups and geographies. All of these actions are expected to be completed or were completed within a year of the program. | ||||||||||||||||
During 2014, 2013 and 2012, we recognized $18 million, $18 million and $21 million, respectively, of lease termination costs for facilities vacated in the period in accordance with our plan as part of all of our restructuring programs and for costs associated with terminating other contractual obligations. These costs are expected to be utilized by the end of 2016. The remaining cash portion owed for these programs in 2015 is approximately $5 million, plus an additional $2 million over the period from 2016 and beyond. | ||||||||||||||||
On January 28, 2015, EMC management approved a restructuring plan. The plan consists of a reduction in force which will be substantially completed by the end of the first quarter of 2015 and fully completed by the end of 2015. The total charge resulting from this plan is expected to be approximately $130 million to $150 million, with total cash payments associated with the plan expected to be in the range of $120 million to $140 million. | ||||||||||||||||
The activity for the restructuring programs is presented below (tables in millions): | ||||||||||||||||
Year Ended, December 31, 2014: | ||||||||||||||||
2014 EMC Program | ||||||||||||||||
Category | Balance as of December 31, 2013 | 2014 Charges | Utilization | Balance as of December 31, 2014 | ||||||||||||
Workforce reductions | $ | — | $ | 212 | $ | (115 | ) | $ | 97 | |||||||
Consolidation of excess facilities and other contractual obligations | — | 18 | (12 | ) | 6 | |||||||||||
Total | $ | — | $ | 230 | $ | (127 | ) | $ | 103 | |||||||
2014 VMware Program | ||||||||||||||||
Category | Balance as of December 31, 2013 | 2014 Charges | Utilization | Balance as of December 31, 2014 | ||||||||||||
Workforce reductions | $ | — | $ | 18 | $ | (10 | ) | $ | 8 | |||||||
Consolidation of excess facilities and other contractual obligations | — | — | — | — | ||||||||||||
Total | $ | — | $ | 18 | $ | (10 | ) | $ | 8 | |||||||
Other EMC Programs | ||||||||||||||||
Category | Balance as of December 31, 2013 | Adjustments to the Provision | Utilization | Balance as of December 31, 2014 | ||||||||||||
Workforce reductions | $ | 66 | $ | (20 | ) | $ | (41 | ) | $ | 5 | ||||||
Consolidation of excess facilities and other contractual obligations | 24 | — | (11 | ) | 13 | |||||||||||
Total | $ | 90 | $ | (20 | ) | $ | (52 | ) | $ | 18 | ||||||
Year Ended, December 31, 2013: | ||||||||||||||||
EMC Programs | ||||||||||||||||
Category | Balance as of December 31, 2012 | 2013 | Utilization | Balance as of December 31, 2013 | ||||||||||||
Charges | ||||||||||||||||
Workforce reductions | $ | 63 | $ | 121 | $ | (118 | ) | $ | 66 | |||||||
Consolidation of excess facilities and other contractual obligations | 28 | 18 | (22 | ) | 24 | |||||||||||
Total | $ | 91 | $ | 139 | $ | (140 | ) | $ | 90 | |||||||
VMware Programs | ||||||||||||||||
Category | Balance as of December 31, 2012 | 2013 | Utilization | Balance as of December 31, 2013 | ||||||||||||
Charges | ||||||||||||||||
Workforce reductions | $ | — | $ | 54 | $ | (54 | ) | $ | — | |||||||
Consolidation of excess facilities and other contractual obligations | — | — | — | — | ||||||||||||
Total | $ | — | $ | 54 | $ | (54 | ) | $ | — | |||||||
Year Ended, December 31, 2012: | ||||||||||||||||
EMC Programs | ||||||||||||||||
Category | Balance as of | 2012 | Utilization | Balance as of December 31, 2012 | ||||||||||||
31-Dec-11 | Charges | |||||||||||||||
Workforce reductions | $ | 50 | $ | 80 | $ | (67 | ) | $ | 63 | |||||||
Consolidation of excess facilities and other contractual obligations | 30 | 21 | (23 | ) | 28 | |||||||||||
Total | $ | 80 | $ | 101 | $ | (90 | ) | $ | 91 | |||||||
During the year ended December 31, 2013, in connection with VMware’s business realignment plan, VMware recognized cumulative pre-tax gains of $44 million relating to the disposition of certain lines of business that were no longer aligned with VMware’s core business priorities. The gains recognized in connection with this disposition was recorded to other expense, net on the consolidated income statements for the year ended December 31, 2013. |
Related_Party_Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2014 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions |
In 2014, 2013 and 2012, we leased certain real estate from a company owned by a member of our Board of Directors and such Director’s siblings, for which payments aggregated approximately $3 million, $5 million and $5 million, respectively. Such lease was initially assumed by us as a result of our acquisition of Data General in 1999 and renewed in 2003 for a ten-year term. The lease expired in September 2014 and EMC has vacated the facility. | |
In accordance with its written policy and procedures relating to related person transactions, EMC’s Audit Committee approved the above transaction. | |
EMC is a large global organization which engages in thousands of purchase, sales and other transactions annually. We enter into purchase and sales transactions with other publicly-traded and privately-held companies, universities, hospitals and not-for-profit organizations with which members of our Board of Directors or executive officers are affiliated. We enter into these arrangements in the ordinary course of our business. | |
From time to time, we make strategic investments in publicly-traded and privately-held companies that develop software, hardware and other technologies or provide services supporting our technologies. We may purchase from or make sales to these organizations. | |
We believe that the terms of each of these arrangements described above were fair and not less favorable to us than could have been obtained from unaffiliated parties. |
Segment_Information
Segment Information | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||
Segment Information | Segment Information | |||||||||||||||||||||||
We manage the Company as a federation of businesses: EMC Information Infrastructure, VMware Virtual Infrastructure and Pivotal. EMC Information Infrastructure operates in three segments: Information Storage, Enterprise Content Division, formerly known as Information Intelligence Group, and RSA Information Security while VMware Virtual Infrastructure and Pivotal each operate as single segments. | ||||||||||||||||||||||||
During the first quarter of 2014, the Information Storage segment acquired the Data Computing Appliance and implementation services businesses from the Pivotal segment. The acquisition of these businesses was accounted for as a business combination between entities under common control. We reflected the impact of the transaction on our segments for 2014 and included the financial results of the acquired businesses in the Information Storage segment and excluded these from the Pivotal segment. We recast the segment and goodwill disclosures for the prior financial reporting periods to present the impact of the transaction. None of the segment reclassifications impact EMC’s previously reported consolidated financial statements. | ||||||||||||||||||||||||
Our management measures are designed to assess performance of these reporting segments excluding certain items. As a result, the corporate reconciling items are used to capture the items excluded from the segment operating performance measures, including stock-based compensation expense and acquisition-related intangible asset amortization expense. Additionally, in certain instances, infrequently occurring gains or losses are also excluded from the measures used by management in assessing segment performance. Research and development expenses, selling, general and administrative expenses and restructuring and acquisition -related charges associated with the EMC Information Infrastructure business are not allocated to the segments within the EMC Information Infrastructure business, as they are managed centrally at the EMC Information Infrastructure business level. EMC Information Infrastructure and Pivotal have not been allocated non-operating income (expense), net and income tax provision as these costs are managed centrally at the EMC corporate level. Accordingly, for the three segments within the EMC Information Infrastructure business, gross profit is the segment operating performance measure, while for Pivotal, operating income is the operating performance measure. The VMware Virtual Infrastructure within EMC amounts represent the revenues and expenses of VMware as reflected within EMC’s consolidated financial statements. | ||||||||||||||||||||||||
Our segment information for the years ended 2014, 2013 and 2012 are as follows (tables in millions, except percentages): | ||||||||||||||||||||||||
EMC Information Infrastructure | ||||||||||||||||||||||||
Information | Enterprise Content Division | RSA | EMC | Pivotal | EMC Information Infrastructure plus Pivotal | |||||||||||||||||||
Storage | Information | Information | ||||||||||||||||||||||
Security | Infrastructure | |||||||||||||||||||||||
2014 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Product revenues | $ | 10,785 | $ | 164 | $ | 462 | $ | 11,411 | $ | 65 | $ | 11,476 | ||||||||||||
Services revenues | 5,757 | 476 | 573 | 6,806 | 162 | 6,968 | ||||||||||||||||||
Total consolidated revenues | 16,542 | 640 | 1,035 | 18,217 | 227 | 18,444 | ||||||||||||||||||
Gross profit | $ | 9,180 | $ | 417 | $ | 698 | $ | 10,295 | $ | 106 | $ | 10,401 | ||||||||||||
Gross profit percentage | 55.5 | % | 65.2 | % | 67.4 | % | 56.5 | % | 46.5 | % | 56.4 | % | ||||||||||||
Research and development | 1,489 | 128 | 1,617 | |||||||||||||||||||||
Selling, general and administrative | 4,583 | 183 | 4,766 | |||||||||||||||||||||
Restructuring and acquisition-related charges | — | — | — | |||||||||||||||||||||
Total costs and expenses | 6,072 | 311 | 6,383 | |||||||||||||||||||||
Operating income (loss) | $ | 4,223 | $ | (205 | ) | $ | 4,018 | |||||||||||||||||
EMC | VMware | Corp | Consolidated | |||||||||||||||||||||
Information | Virtual | Reconciling | ||||||||||||||||||||||
Infrastructure plus Pivotal | Infrastructure | Items | ||||||||||||||||||||||
within EMC | ||||||||||||||||||||||||
2014 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Product revenues | $ | 11,476 | $ | 2,575 | $ | — | $ | 14,051 | ||||||||||||||||
Services revenues | 6,968 | 3,421 | — | 10,389 | ||||||||||||||||||||
Total consolidated revenues | 18,444 | 5,996 | — | 24,440 | ||||||||||||||||||||
Gross profit | $ | 10,401 | $ | 5,241 | $ | (393 | ) | $ | 15,249 | |||||||||||||||
Gross profit percentage | 56.4 | % | 87.4 | % | — | 62.4 | % | |||||||||||||||||
Research and development | 1,617 | 987 | 387 | 2,991 | ||||||||||||||||||||
Selling, general and administrative | 4,766 | 2,390 | 826 | 7,982 | ||||||||||||||||||||
Restructuring and acquisition-related charges | — | — | 239 | 239 | ||||||||||||||||||||
Total costs and expenses | 6,383 | 3,377 | 1,452 | 11,212 | ||||||||||||||||||||
Operating income | 4,018 | 1,864 | (1,845 | ) | 4,037 | |||||||||||||||||||
Non-operating income (expense) | (362 | ) | 34 | 53 | (275 | ) | ||||||||||||||||||
Income tax provision | 942 | 385 | (459 | ) | 868 | |||||||||||||||||||
Net income | 2,714 | 1,513 | (1,333 | ) | 2,894 | |||||||||||||||||||
Net income attributable to the non-controlling interest in VMware, Inc. | — | (308 | ) | 128 | (180 | ) | ||||||||||||||||||
Net income attributable to EMC Corporation | $ | 2,714 | $ | 1,205 | $ | (1,205 | ) | $ | 2,714 | |||||||||||||||
EMC Information Infrastructure | ||||||||||||||||||||||||
Information | Enterprise Content Division | RSA | EMC | Pivotal | EMC Information Infrastructure plus Pivotal | |||||||||||||||||||
Storage | Information | Information | ||||||||||||||||||||||
Security | Infrastructure | |||||||||||||||||||||||
2013 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Product revenues | $ | 10,738 | $ | 180 | $ | 453 | $ | 11,371 | $ | 66 | $ | 11,437 | ||||||||||||
Services revenues | 5,524 | 467 | 534 | 6,525 | 113 | 6,638 | ||||||||||||||||||
Total consolidated revenues | 16,262 | 647 | 987 | 17,896 | 179 | 18,075 | ||||||||||||||||||
Gross profit | $ | 9,109 | $ | 419 | $ | 655 | $ | 10,183 | $ | 91 | $ | 10,274 | ||||||||||||
Gross profit percentage | 56 | % | 64.8 | % | 66.4 | % | 56.9 | % | 50.7 | % | 56.8 | % | ||||||||||||
Research and development | 1,461 | 109 | 1,570 | |||||||||||||||||||||
Selling, general and administrative | 4,571 | 161 | 4,732 | |||||||||||||||||||||
Restructuring and acquisition-related charges | — | — | — | |||||||||||||||||||||
Total costs and expenses | 6,032 | 270 | 6,302 | |||||||||||||||||||||
Operating income (loss) | $ | 4,151 | $ | (179 | ) | $ | 3,972 | |||||||||||||||||
EMC | VMware | Corp | Consolidated | |||||||||||||||||||||
Information | Virtual | Reconciling | ||||||||||||||||||||||
Infrastructure plus Pivotal | Infrastructure | Items | ||||||||||||||||||||||
within EMC | ||||||||||||||||||||||||
2013 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Product revenues | $ | 11,437 | $ | 2,253 | $ | — | $ | 13,690 | ||||||||||||||||
Services revenues | 6,638 | 2,894 | — | 9,532 | ||||||||||||||||||||
Total consolidated revenues | 18,075 | 5,147 | — | 23,222 | ||||||||||||||||||||
Gross profit | $ | 10,274 | $ | 4,589 | $ | (390 | ) | $ | 14,473 | |||||||||||||||
Gross profit percentage | 56.8 | % | 89.2 | % | — | 62.3 | % | |||||||||||||||||
Research and development | 1,570 | 826 | 365 | 2,761 | ||||||||||||||||||||
Selling, general and administrative | 4,732 | 2,003 | 603 | 7,338 | ||||||||||||||||||||
Restructuring and acquisition-related charges | — | — | 224 | 224 | ||||||||||||||||||||
Total costs and expenses | 6,302 | 2,829 | 1,192 | 10,323 | ||||||||||||||||||||
Operating income | 3,972 | 1,760 | (1,582 | ) | 4,150 | |||||||||||||||||||
Non-operating income (expense) | (337 | ) | 22 | 30 | (285 | ) | ||||||||||||||||||
Income tax provision | 911 | 317 | (456 | ) | 772 | |||||||||||||||||||
Net income | 2,724 | 1,465 | (1,096 | ) | 3,093 | |||||||||||||||||||
Net income attributable to the non-controlling interest in VMware, Inc. | — | (295 | ) | 91 | (204 | ) | ||||||||||||||||||
Net income attributable to EMC Corporation | $ | 2,724 | $ | 1,170 | $ | (1,005 | ) | $ | 2,889 | |||||||||||||||
EMC Information Infrastructure | ||||||||||||||||||||||||
Information | Enterprise Content Division | RSA | EMC | Pivotal | EMC Information Infrastructure plus Pivotal | |||||||||||||||||||
Storage | Information | Information | ||||||||||||||||||||||
Security | Infrastructure | |||||||||||||||||||||||
2012 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Product revenues | $ | 10,316 | $ | 200 | $ | 414 | $ | 10,930 | $ | 73 | $ | 11,003 | ||||||||||||
Services revenues | 5,257 | 440 | 475 | 6,172 | 64 | 6,236 | ||||||||||||||||||
Total consolidated revenues | 15,573 | 640 | 889 | 17,102 | 137 | 17,239 | ||||||||||||||||||
Gross profit | $ | 8,911 | $ | 432 | $ | 604 | $ | 9,947 | $ | 102 | $ | 10,049 | ||||||||||||
Gross profit percentage | 57.2 | % | 67.5 | % | 68 | % | 58.2 | % | 74.4 | % | 58.3 | % | ||||||||||||
Research and development | 1,410 | 116 | 1,526 | |||||||||||||||||||||
Selling, general and administrative | 4,488 | 151 | 4,639 | |||||||||||||||||||||
Restructuring and acquisition-related charges | — | — | — | |||||||||||||||||||||
Total costs and expenses | 5,898 | 267 | 6,165 | |||||||||||||||||||||
Operating income (loss) | $ | 4,049 | $ | (165 | ) | $ | 3,884 | |||||||||||||||||
EMC | VMware | Corp | Consolidated | |||||||||||||||||||||
Information | Virtual | Reconciling | ||||||||||||||||||||||
Infrastructure plus Pivotal | Infrastructure | Items | ||||||||||||||||||||||
within EMC | ||||||||||||||||||||||||
2012 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Product revenues | $ | 11,003 | $ | 2,058 | $ | — | $ | 13,061 | ||||||||||||||||
Services revenues | 6,236 | 2,417 | — | 8,653 | ||||||||||||||||||||
Total consolidated revenues | 17,239 | 4,475 | — | 21,714 | ||||||||||||||||||||
Gross profit | $ | 10,049 | $ | 3,976 | $ | (387 | ) | $ | 13,638 | |||||||||||||||
Gross profit percentage | 58.3 | % | 88.9 | % | — | 62.8 | % | |||||||||||||||||
Research and development | 1,526 | 700 | 334 | 2,560 | ||||||||||||||||||||
Selling, general and administrative | 4,639 | 1,739 | 626 | 7,004 | ||||||||||||||||||||
Restructuring and acquisition-related charges | — | — | 110 | 110 | ||||||||||||||||||||
Total costs and expenses | 6,165 | 2,439 | 1,070 | 9,674 | ||||||||||||||||||||
Operating income | 3,884 | 1,537 | (1,457 | ) | 3,964 | |||||||||||||||||||
Non-operating income (expense) | (177 | ) | 27 | (10 | ) | (160 | ) | |||||||||||||||||
Income tax provision | 968 | 271 | (321 | ) | 918 | |||||||||||||||||||
Net income | 2,739 | 1,293 | (1,146 | ) | 2,886 | |||||||||||||||||||
Net income attributable to the non-controlling interest in VMware, Inc. | — | (255 | ) | 102 | (153 | ) | ||||||||||||||||||
Net income attributable to EMC Corporation | $ | 2,739 | $ | 1,038 | $ | (1,044 | ) | $ | 2,733 | |||||||||||||||
Our revenues are attributed to the geographic areas according to the location of the customers. Revenues by geographic area are included in the following table (table in millions): | ||||||||||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||||||||
United States | $ | 12,835 | $ | 12,230 | $ | 11,510 | ||||||||||||||||||
Europe, Middle East and Africa | 6,981 | 6,355 | 5,908 | |||||||||||||||||||||
Asia Pacific and Japan | 3,191 | 3,193 | 3,017 | |||||||||||||||||||||
Latin America, Mexico and Canada | 1,433 | 1,444 | 1,279 | |||||||||||||||||||||
Total | $ | 24,440 | $ | 23,222 | $ | 21,714 | ||||||||||||||||||
No country other than the United States accounted for 10% or more of revenues in 2014, 2013 or 2012. | ||||||||||||||||||||||||
Long-lived assets, excluding financial instruments, deferred tax assets, goodwill and intangible assets, in the United States were $4,380 million at December 31, 2014 and $4,433 million at December 31, 2013. Internationally, long-lived assets, excluding financial instruments, deferred tax assets, goodwill and intangible assets, were $1,021 million at December 31, 2014 and $877 million at December 31, 2013. No country other than the United States accounted for 10% or more of total long-lived assets, excluding financial instruments and deferred tax assets, at December 31, 2014 or 2013. |
Selected_Quarterly_Financial_D
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||
Selected Quarterly Financial Data (Unaudited) | Selected Quarterly Financial Data (unaudited) | ||||||||||||||||
Quarterly financial data for 2014 and 2013 is as follows (tables in millions, except per share amounts): | |||||||||||||||||
2014 | Q1 2014 | Q2 2014 | Q3 2014 | Q4 2014 | |||||||||||||
Revenues | $ | 5,479 | $ | 5,880 | $ | 6,032 | $ | 7,048 | |||||||||
Gross profit | 3,347 | 3,654 | 3,743 | 4,505 | |||||||||||||
Net income attributable to EMC Corporation | 392 | 589 | 587 | 1,147 | |||||||||||||
Net income per weighted average share, diluted: common shareholders | $ | 0.19 | $ | 0.28 | $ | 0.28 | $ | 0.56 | |||||||||
2013 | Q1 2013 | Q2 2013 | Q3 2013 | Q4 2013 | |||||||||||||
Revenues | $ | 5,387 | $ | 5,614 | $ | 5,539 | $ | 6,682 | |||||||||
Gross profit | 3,298 | 3,509 | 3,442 | 4,224 | |||||||||||||
Net income attributable to EMC Corporation | 580 | 701 | 586 | 1,022 | |||||||||||||
Net income per weighted average share, diluted: common shareholders | $ | 0.26 | $ | 0.32 | $ | 0.27 | $ | 0.48 | |||||||||
The second and fourth quarters of 2014 includes a gain on previously held interests in strategic investments and joint venture of $45 million, or $0.02 per diluted share and $33 million, or $0.02 per diluted share, respectively. The second quarter of 2014 also includes an impairment of strategic investment of $24 million, or $0.01 per diluted share. The fourth quarter of 2014 includes a tax benefit related to the expected R&D tax credit for 2014 of $62 million, or $0.03 per diluted share. | |||||||||||||||||
The first quarter of 2013 includes the benefit of the R&D tax credit for 2012 of $60 million, or $0.03 per diluted share. The second and third quarters of 2013 each include net gains on VMware's disposition of certain lines of business and other of $10 million and $11 million or $0.01 and $0.01 per diluted share, respectively. The third and fourth quarters of 2013 also include special tax items related to our tax-related reorganizations of $23 million, or $0.01 per diluted share and a tax benefit of $4 million, or $0.00 per diluted share, respectively. |
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events |
On January 28, 2015, EMC management approved a restructuring plan. The plan consists of a reduction in force which will be substantially completed by the end of the first quarter of 2015 and fully completed by the end of 2015. The total charge resulting from this plan is expected to be approximately $130 million to $150 million, with total cash payments associated with the plan expected to be in the range of $120 million to $140 million. | |
On February 27, 2015, we entered into a credit agreement with the lenders named therein, Citibank, N.A., as Administrative Agent, Bank of America, N.A. and JPMorgan Chase Bank, N.A., as Syndication Agents, and Citigroup Global Markets, Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated and J.P. Morgan Securities LLC, as Joint Lead Arrangers and Joint Bookrunners (the “Credit Agreement”). The Credit Agreement provides for a $2.5 billion unsecured revolving credit facility to be used for general corporate purposes that is scheduled to mature on February 27, 2020. At our option, subject to certain conditions, any loan under the Credit Agreement will bear interest at a rate equal to, either (i) the LIBOR Rate or (ii) the Base Rate (defined as the highest of (a) the Federal Funds rate plus 0.50%, (b) Citibank, N.A.’s “prime rate” as announced from time to time, or (c) one-month LIBOR plus 1.00%), plus, in each case the Applicable Margin, as defined in the Credit Agreement. The Credit Agreement contains customary representations and warranties, covenants and events of default. We may also, upon the agreement of the existing lenders and/or additional lenders not currently parties to the agreement, increase the commitments under the credit facility by up to an additional $1.0 billion. In addition, we may request to extend the maturity date of the credit facility, subject to certain conditions, for additional one-year periods. |
Schedule_II_Valuation_and_Qual
Schedule II - Valuation and Qualifying Accounts | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Valuation and Qualifying Accounts [Abstract] | ||||||||||||||||
Schedule II - Valuation and Qualifying Accounts | Accounts and Notes Receivable and Allowance for Credit Losses | |||||||||||||||
Accounts and notes receivable are recorded at cost. The portion of our notes receivable due in one year or less are included in accounts and notes receivable and the long-term portion is included in other assets, net on the consolidated balance sheets. Lease receivables arise from sales-type leases of products. We typically sell, without recourse, the contractual right to the lease payment stream and assets under lease to third parties. For certain customers, we retain the lease. | ||||||||||||||||
The contractual amounts due under the leases we retained as of December 31, 2014 were as follows (table in millions): | ||||||||||||||||
Year | Contractual Amounts | |||||||||||||||
Due Under Leases | ||||||||||||||||
Due within one year | $ | 97 | ||||||||||||||
Due within two years | 73 | |||||||||||||||
Due within three years | 62 | |||||||||||||||
Thereafter | 1 | |||||||||||||||
Total | 233 | |||||||||||||||
Less amounts representing interest | (5 | ) | ||||||||||||||
Present value | 228 | |||||||||||||||
Current portion (included in accounts and notes receivable) | 94 | |||||||||||||||
Long-term portion (included in other assets, net) | $ | 134 | ||||||||||||||
Subsequent to December 31, 2014, we sold $54 million of these notes to third parties without recourse. | ||||||||||||||||
We maintain an allowance for credit losses on our accounts and notes receivable. The allowance is based on the credit worthiness of our customers, including an assessment of the customer’s financial position, operating performance and their ability to meet their contractual obligation. We assess the creditworthiness for our customers each quarter. In addition, we consider our historical experience, the age of the receivable and current market and economic conditions. Uncollectible amounts are charged against the allowance account. | ||||||||||||||||
In the event we determine that a lease may not be paid, we include in our allowance an amount for the outstanding balance related to the lease receivable. As of December 31, 2014, amounts from lease receivables past due for more than 90 days were not significant. | ||||||||||||||||
The following table presents the activity of our allowance for credit losses related to lease receivables for the years ended December 31, 2014 and 2013 (table in millions): | ||||||||||||||||
December 31, | December 31, | |||||||||||||||
2014 | 2013 | |||||||||||||||
Balance, beginning of the period | $ | 9 | $ | 17 | ||||||||||||
Recoveries | (7 | ) | (12 | ) | ||||||||||||
Provisions | 4 | 4 | ||||||||||||||
Balance, end of the period | $ | 6 | $ | 9 | ||||||||||||
Gross lease receivables totaled $233 million and $252 million in 2014 and 2013, respectively, before the allowance. The components of these balances were individually evaluated for impairment and included in our allowance determination as necessary. | ||||||||||||||||
EMC CORPORATION AND SUBSIDIARIES | ||||||||||||||||
SCHEDULE II–VALUATION AND QUALIFYING ACCOUNTS | ||||||||||||||||
(in millions) | ||||||||||||||||
Allowance for Bad Debts | Balance at Beginning of Period | Allowance for Bad Debts Charged to Selling, General and Administrative Expenses | Bad Debts | Balance at | ||||||||||||
Description | Write-Offs | End of Period | ||||||||||||||
Year ended December 31, 2014 allowance for doubtful accounts | $ | 65 | $ | 10 | $ | (1 | ) | $ | 74 | |||||||
Year ended December 31, 2013 allowance for doubtful accounts | 72 | (1 | ) | (6 | ) | 65 | ||||||||||
Year ended December 31, 2012 allowance for doubtful accounts | 65 | 39 | (32 | ) | 72 | |||||||||||
Note: The allowance for doubtful accounts includes both current and non-current portions. | ||||||||||||||||
Allowance for Sales Returns | Balance at Beginning of Period | Allowance for Sales Returns Accounted for as a Reduction in Revenue | Sales Returns | Balance at | ||||||||||||
Description | End of Period | |||||||||||||||
Year ended December 31, 2014 allowance for sales returns | $ | 76 | $ | 89 | $ | (95 | ) | $ | 70 | |||||||
Year ended December 31, 2013 allowance for sales returns | 86 | 55 | (65 | ) | 76 | |||||||||||
Year ended December 31, 2012 allowance for sales returns | 133 | 17 | (64 | ) | 86 | |||||||||||
Tax Valuation Allowance | Balance at Beginning of Period | Tax Valuation Allowance Charged to Income Tax Provision | Tax Valuation Allowance Credited to Income Tax Provision | Balance at | ||||||||||||
Description | End of Period | |||||||||||||||
Year ended December 31, 2014 income tax valuation allowance | $ | 211 | $ | 1 | $ | (86 | ) | $ | 126 | |||||||
Year ended December 31, 2013 income tax valuation allowance | 183 | 32 | (4 | ) | 211 | |||||||||||
Year ended December 31, 2012 income tax valuation allowance | 151 | 33 | (1 | ) | 183 | |||||||||||
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||
Company | Company | ||||||||
EMC Corporation (“EMC”) and its subsidiaries develop, deliver and support the information technology (“IT”) industry’s broadest range of information infrastructure and virtual infrastructure technologies, solutions and services. EMC manages the Company as part of a federation of businesses: EMC Information Infrastructure, VMware Virtual Infrastructure and Pivotal. | |||||||||
EMC’s Information Infrastructure business provides a foundation for organizations to store, manage, protect, analyze and secure ever-increasing quantities of information, while at the same time improving business agility, lowering cost, and enhancing competitive advantage. EMC’s Information Infrastructure business comprises three segments – Information Storage, Enterprise Content Division, formerly known as Information Intelligence Group, and RSA Information Security. | |||||||||
EMC’s VMware Virtual Infrastructure business, which is represented by EMC’s majority equity stake in VMware, Inc. (“VMware”), is the leader in virtualization infrastructure solutions utilized by organizations to help them transform the way they build, deliver and consume IT resources. VMware’s virtualization infrastructure solutions, which include a suite of products and services designed to deliver a software-defined data center, run on industry-standard desktop computers and servers and support a wide range of operating system and application environments, as well as networking and storage infrastructures. | |||||||||
EMC’s Pivotal business (“Pivotal”) unites strategic technology, people and programs from EMC and VMware and has built a new platform comprising of next-generation data, agile development practices and a cloud independent platform-as-a-service (“PaaS”). | |||||||||
Accounting Principles | Accounting Principles | ||||||||
The financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). | |||||||||
Principles of Consolidation | Principles of Consolidation | ||||||||
These consolidated financial statements include the accounts of EMC, its wholly-owned subsidiaries, and Pivotal and VMware, companies which are majority-owned by EMC. All intercompany transactions have been eliminated. | |||||||||
EMC’s interest in VMware was approximately 80% at both December 31, 2014 and 2013. VMware’s financial results have been consolidated with that of EMC for all periods presented as EMC is VMware’s controlling stockholder. The portion of the results of operations of VMware allocable to its other owners is shown as net income attributable to the non-controlling interest in VMware, Inc. on EMC’s consolidated income statements. Additionally, the cumulative portion of the results of operations of VMware allocable to its other owners, along with the interest in the net assets of VMware attributable to those other owners, is shown as a component of non-controlling interests on EMC’s consolidated balance sheets and as a reduction of net income attributable to EMC shareholders. | |||||||||
EMC’s economic interest in Pivotal was approximately 84% at both December 31, 2014 and 2013. Pivotal’s financial results have been consolidated with that of EMC for all periods presented. The non-controlling interests’ share of equity in Pivotal is reflected as a component of the non-controlling interests in EMC’s consolidated balance sheets and as a reduction of net income attributable to EMC shareholders. Because the non-controlling interest in Pivotal is in the form of a preferred equity instrument, there is no net income attributable to non-controlling interest related to Pivotal on EMC’s consolidated income statements. | |||||||||
Use of Accounting Estimates | Use of Accounting Estimates | ||||||||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, the reported amounts of revenues and expenses during the reporting period and the disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates. | |||||||||
Revenue Recognition | Revenue Recognition | ||||||||
We derive revenue from sales of systems, software licenses and services. We recognize revenue when persuasive evidence of an arrangement exists, delivery has occurred, the sales price is fixed or determinable and collectability is reasonably assured. This policy is applicable to all sales, including sales to resellers and end users. Delivery is achieved when our product has been physically shipped or made available for use by electronic delivery and the risk of loss has been transferred which, for most of our product sales, occurs upon shipment. The following summarizes the major terms of our contractual relationships with our customers and the manner in which we account for sales transactions. | |||||||||
• | Product revenue | ||||||||
Product revenue consists of systems and software licenses sales that are delivered, sold as a subscription or sold on a consumption basis. System sales include storage hardware, required system software and other hardware-related devices. Software license sales include optional, stand-alone software applications. Our software applications provide customers with resource management, backup and archiving, information security, information management and intelligence, data analytics and server virtualization capabilities. Depending on the nature of the arrangement, revenue for system and software license sales is generally recognized upon shipment, electronic delivery. For certain arrangements, revenue is recognized based on usage or ratably over the term of the arrangement. License revenue from royalty arrangements is recognized upon either receipt of royalty reports or payments from third parties. | |||||||||
• | Services revenue | ||||||||
Services revenue consists of installation services, professional services, software maintenance, hardware maintenance, training and software sold as a service. | |||||||||
We recognize revenue from fixed-price support or maintenance contracts sold for both hardware and software, including extended warranty contracts, ratably over the contract period and recognize the costs associated with these contracts as incurred. Generally, installation and professional services are not considered essential to the functionality of our products as these services do not alter the product capabilities and may be performed by our customers or other vendors. Installation services revenues are recognized as the services are being performed. Professional services revenues on engagements for which reasonably dependable estimates of progress toward completion are capable of being made are recognized using the proportional performance method, which recognizes revenue based on labor costs incurred in proportion to total expected labor costs to perform the service. Where services are considered essential to the functionality of our products, revenue for the products and services is recorded over the service period. Professional services engagements that are sold on a time and materials basis are recognized based upon the labor costs incurred. Revenues from software sold as a service is recognized based on usage or ratably over the term of the service period depending upon the nature of the arrangement. Revenues on all other professional services engagements are recognized upon completion. | |||||||||
• | Multiple element arrangements | ||||||||
When more than one element, such as hardware, software and services are contained in a single arrangement, we first allocate revenue based upon the relative selling price into two categories: (1) non-software components, such as hardware and any hardware-related items, such as required system software that functions with the hardware to deliver the essential functionality of the hardware and related post-contract customer support, software as a service subscriptions and other services and (2) software components, such as optional software applications and related items, such as post-contract customer support and other services. We then allocate revenue within the non-software category to each element based upon their relative selling price using a hierarchy of vendor-specific objective evidence (“VSOE”), third-party evidence of selling price (“TPE”) or estimated selling prices (“ESP”), if VSOE or TPE does not exist. We allocate revenue within the software category to the undelivered elements based upon their fair value using VSOE with the residual revenue allocated to the delivered elements. If we cannot objectively determine the VSOE of the fair value of any undelivered software element, we defer revenue for all software components until all elements are delivered and services have been performed, until fair value can objectively be determined for any remaining undelivered elements, or until software maintenance is the only undelivered element in which case revenue is recognized over the maintenance term for all software elements. | |||||||||
We allocate the amount of revenue recognition for delivered elements to the amount that is not subject to forfeiture or refund or contingent on the future delivery of products or services. | |||||||||
Customers under software maintenance agreements are entitled to receive updates and upgrades on a when-and-if-available basis, and various types of technical support based on the level of support purchased. In the event specific features, functionality, entitlements, or the release version of an upgrade or new product have been announced but not delivered, and customers will receive that upgrade or new product as part of a current software maintenance contract, a specified upgrade is deemed created and product revenues are deferred on purchases made after the announcement date until delivery of the upgrade or new product. The amount and elements to be deferred are dependent on whether we have established VSOE of fair value for the upgrade or new product. | |||||||||
• | Indirect channel sales | ||||||||
We market and sell our products through our direct sales force and indirect channels such as independent distributors and value-added resellers. For substantially all of our indirect sales, we recognize revenues on products sold to resellers and distributors on a sell through basis. These product sales are evidenced by a master distribution agreement, together with evidence of an end-user arrangement, on a transaction-by-transaction basis. | |||||||||
We offer rebates to certain channel partners. We generally recognize the amount of the rebates as a reduction of revenues when the underlying revenue is recognized. We also offer marketing development funds to certain channel partners. We generally record the amount of the marketing development funds, based on the maximum potential liability, as a marketing expense as the funds are earned by the channel partners. | |||||||||
• | Shipping terms | ||||||||
Our sales contracts generally provide for the customer to accept risk of loss when the product leaves our facilities. When shipping terms or local laws do not allow for passage of risk of loss at shipping point, we defer recognizing revenue until risk of loss transfers to the customer. | |||||||||
• | Leases | ||||||||
Revenue from sales-type leases is recognized at the net present value of future lease payments. Revenue from operating leases is recognized over the lease period. | |||||||||
• | Other | ||||||||
We accrue for the estimated costs of systems’ warranty at the time of sale. We reduce revenue for estimated sales returns at the time of sale. Systems’ warranty costs are estimated based upon our historical experience and specific identification of systems’ requirements. Sales returns are estimated based upon our historical experience and specific identification of probable returns. | |||||||||
Deferred Revenue | Deferred Revenue | ||||||||
Our deferred revenue consists primarily of deferred hardware and software maintenance and unearned license fees, which are recognized ratably over the contract term as either product or services revenue depending on the nature of the item, and deferred professional services, including education and training, which are recognized in services revenue as the services are provided. | |||||||||
Shipping and Handling Costs | Shipping and Handling Costs | ||||||||
Shipping and handling costs are classified in cost of product sales. | |||||||||
Foreign Currency Translation | Foreign Currency Translation | ||||||||
The local currency is the functional currency of the majority of our subsidiaries. Assets and liabilities are translated into U.S. dollars at exchange rates in effect at the balance sheet date. Income and expense items are translated at daily rates. | |||||||||
Gains and losses from foreign currency transactions are included in other expense, net, and consist of net losses of $30 million , $2 million and $16 million in 2014, 2013 and 2012, respectively. Foreign currency translation adjustments are included in other comprehensive income (loss). | |||||||||
Derivatives | Derivatives | ||||||||
We use derivatives to hedge foreign currency exposures related to foreign currency denominated assets and liabilities and forecasted revenue and expense transactions. | |||||||||
We hedge our exposure in foreign currency denominated monetary assets and liabilities with foreign currency forward and option contracts. Since these derivatives hedge existing exposures that are denominated in foreign currencies, the contracts do not qualify for hedge accounting. Accordingly, these outstanding non-designated derivatives are recognized on the consolidated balance sheet at fair value and the changes in fair value from these contracts are recorded in other expense, net, in the consolidated income statements. These derivative contracts mature in less than one year. | |||||||||
We also use foreign currency forward and option contracts to hedge our exposure on a portion of our forecasted revenue and expense transactions. These derivatives are designated as cash flow hedges. We did not have any derivatives designated as fair value hedges as of December 31, 2014. All outstanding cash flow hedges are recognized on the consolidated balance sheets at fair value with changes in their fair value recorded in accumulated other comprehensive income (loss) until the underlying forecasted transactions occur. To achieve hedge accounting, certain criteria must be met, which includes (i) ensuring at the inception of the hedge that formal documentation exists for both the hedging relationship and the entity’s risk management objective and strategy for undertaking the hedge, and (ii) at the inception of the hedge and on an ongoing basis, the hedging relationship is expected to be highly effective in achieving offsetting changes in fair value attributed to the hedged risk during the period that the hedge is designated. Further, an assessment of effectiveness is required at a minimum on a quarterly basis. Absent meeting these criteria, changes in fair value are recognized currently in other expense, net, in the consolidated income statements. Once the underlying forecasted transaction occurs, the gain or loss from the derivative designated as a hedge of the transaction is reclassified from accumulated other comprehensive income (loss) to the consolidated income statements, in the related revenue or expense caption, as appropriate. In the event the underlying forecasted transaction does not occur, the amount recorded in accumulated other comprehensive income (loss) will be reclassified to other income (expense), net, in the consolidated income statements in the then-current period. Any ineffective portion of the derivatives designated as cash flow hedges is recognized in current earnings. The ineffective portion of the derivatives includes gains or losses associated with differences between actual and forecasted amounts. Our cash flow hedges generally mature within six months or less. The notional amount of cash flow hedges outstanding as of December 31, 2014, 2013 and 2012 were $245 million, $384 million and $201 million, respectively. | |||||||||
We do not engage in currency speculation. For purposes of presentation within the consolidated statement of cash flows, derivative gains and losses are presented within net cash provided by operating activities. | |||||||||
Our derivatives and their related activities are not material to our consolidated balance sheets or consolidated income statements. | |||||||||
Cash and Cash Equivalents | Cash and Cash Equivalents | ||||||||
Cash and cash equivalents include highly liquid investments with a maturity of ninety days or less at the time of purchase. Cash equivalents consist primarily of money market securities, U.S. Treasury bills, U.S. Agency discount notes and commercial paper. Cash equivalents are stated at fair value. See Note F. | |||||||||
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts | ||||||||
We maintain an allowance for doubtful accounts for the estimated probable losses on uncollectible accounts and notes receivable. The allowance is based upon the creditworthiness of our customers, our historical experience, the age of the receivable and current market and economic conditions. Uncollectible amounts are charged against the allowance account. The allowance for doubtful accounts is maintained against both our current and non-current accounts and notes receivable balances. The balances in the allowance accounts at December 31, 2014 and 2013 were as follows (table in millions): | |||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Current | $ | 72 | $ | 62 | |||||
Non-current (included in other assets, net) | 2 | 3 | |||||||
$ | 74 | $ | 65 | ||||||
Investments | Investments | ||||||||
Unrealized gains and temporary loss positions on investments classified as available-for-sale are included within accumulated other comprehensive income (loss), net of any related tax effect. Upon realization, those amounts are reclassified from accumulated other comprehensive income (loss) to investment income. Realized gains and losses and other-than-temporary impairments are reflected in the consolidated income statement in investment income. For investments accounted for utilizing the fair value option, changes to fair value are recognized in the consolidated income statement in non-operating income (expense), net. | |||||||||
Inventories | Inventories | ||||||||
Inventories are stated at the lower of cost (first-in, first-out) or market, not in excess of net realizable value. | |||||||||
Property, Plant and Equipment | Property, Plant and Equipment | ||||||||
Property, plant and equipment are recorded at cost. Buildings under development are included in building construction in progress. Depreciation commences upon placing the asset in service and is recognized on a straight-line basis over the estimated useful lives of the assets, as follows: | |||||||||
Furniture and fixtures | 5-10 years | ||||||||
Equipment and software | 2-10 years | ||||||||
Improvements | 5-31 years | ||||||||
Buildings | 15-51 years | ||||||||
Upon retirement or disposition, the asset cost and related accumulated depreciation are removed with any gain or loss recognized in the consolidated income statements. Repair and maintenance costs, including planned maintenance, are expensed as incurred. | |||||||||
Research and Development and Capitalized Software Development Costs | Research and Development and Capitalized Software Development Costs | ||||||||
Research and development (“R&D”) costs are expensed as incurred. R&D costs include salaries and benefits, stock-based compensation, consultants, facilities related costs, material costs, depreciation and travel. Material software development costs incurred subsequent to establishing technological feasibility through the general release of the software products are capitalized. Technological feasibility is demonstrated by the completion of a detailed program design or working model, if no program design is completed. GAAP requires that annual amortization expense of the capitalized software development costs be the greater of the amounts computed using the ratio of gross revenue to a products’ total current and anticipated revenues, or the straight-line method over the products’ remaining estimated economic life. Capitalized costs are amortized over periods ranging from eighteen months to two years which represents the products’ estimated economic life. | |||||||||
Unamortized software development costs were $829 million and $762 million at December 31, 2014 and 2013, respectively, and are included in other assets, net. Amortization expense was $482 million, $427 million and $398 million in 2014, 2013 and 2012, respectively. Amounts capitalized were $549 million, $487 million and $432 million in 2014, 2013 and 2012, respectively. The amounts capitalized include stock-based compensation which is not reflected in the consolidated statements of cash flows as it is a non-cash item. | |||||||||
Long-lived Assets | Long-lived Assets | ||||||||
Purchased intangible assets, other than goodwill, are amortized over their estimated useful lives which range from one to eighteen years. Intangible assets include goodwill, purchased technology, trademarks and tradenames, customer relationships and customer lists, software licenses, patents, leasehold interest and other intangible assets, which include backlog, non-competition agreements and non-solicitation agreements. Most of our intangible assets are amortized based upon the pattern in which the economic benefits of the intangible assets are being utilized; the remainder are amortized on a straight-line basis. Goodwill is not amortized and is carried at its historical cost. | |||||||||
We periodically review our long-lived assets for impairment. We initiate reviews for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. Each impairment test, other than goodwill, is based on a comparison of the un-discounted cash flows to the recorded value of the asset. If an impairment is indicated, the asset is written down to its estimated fair value. | |||||||||
We test goodwill for impairment in the fourth quarter of each year or more frequently if events or changes in circumstances indicate that the asset might be impaired. The test is based on a comparison of the reporting unit’s book value to its estimated fair market value. We perform both qualitative and quantitative tests of our goodwill. | |||||||||
Investments in Joint Ventures | Investments in Joint Ventures | ||||||||
We make investments in joint ventures. For each joint venture investment we consider the facts and circumstances in order to determine whether it qualifies for cost, equity or fair value method accounting or whether it should be consolidated. | |||||||||
In 2009, Cisco and EMC formed VCE Company LLC (“VCE”), with investments from VMware and Intel. VCE, through Vblock infrastructure platforms, delivers an integrated IT offering that combines network, computing, storage, management, security and virtualization technologies for converged infrastructures and cloud based computing models. | |||||||||
In December 2014, EMC acquired the controlling interest in VCE. Prior to the acquisition of the controlling interest in VCE, we considered VCE a variable interest entity. Authoritative guidance related to variable interest entities states that the primary beneficiary of a variable interest entity must have both of the following characteristics: (a) the power to direct the activities of a variable interest entity that most significantly will impact the entity’s economic performance; and (b) the obligation to absorb losses that could be potentially significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity. Since the power to direct the activities of VCE which most significantly impact its economic performance was determined by its board of directors, which was comprised of equal representation of EMC and Cisco, and all significant decisions required the approval of the minority shareholders, we determined that prior to acquiring the controlling interest, we were not the primary beneficiary, and as such we accounted for the investment under the equity method with our portion of the gains and losses recognized in other expense, net in the consolidated income statements for the majority of 2014, and all of 2013 and 2012. Since the date of acquiring the controlling interest in VCE, we have consolidated VCE’s financial position and results as part of EMC’s consolidated financial statements. | |||||||||
Advertising | Advertising | ||||||||
Advertising costs are expensed as incurred. Advertising expense was $25 million, $23 million and $30 million in 2014, 2013 and 2012, respectively. | |||||||||
Legal Costs | Legal Costs | ||||||||
Legal costs incurred in connection with loss contingencies are recognized when the costs are probable of occurrence and can be reasonably estimated. | |||||||||
Income Taxes | Income Taxes | ||||||||
Deferred tax liabilities and assets are recognized for the expected future tax consequences of events that have been included in the financial statements or tax returns. Deferred tax liabilities and assets are determined based on the difference between the tax basis of assets and liabilities and their reported amounts using enacted tax rates in effect for the year in which the differences are expected to reverse. Tax credits are generally recognized as reductions of income tax provisions in the year in which the credits arise. The measurement of deferred tax assets is reduced by a valuation allowance if, based upon available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. | |||||||||
Accounting for uncertainty in income taxes recognized in the financial statements is in accordance with accounting authoritative guidance, which prescribes a two-step process to determine the amount of tax benefit to be recognized. First, the tax position must be evaluated to determine the likelihood that it will be sustained upon external examination. If the tax position is deemed “more-likely-than-not” to be sustained, the tax position is then assessed to determine the amount of benefit to recognize in the financial statements. The amount of the benefit that may be recognized is the largest amount that has a greater than 50 percent likelihood of being realized upon ultimate settlement. | |||||||||
We do not provide for a U.S. income tax liability on undistributed earnings of our foreign subsidiaries. The earnings of non-U.S. subsidiaries, which reflect full provision for non-U.S. income taxes, are currently indefinitely reinvested in non-U.S. operations or are expected to be remitted substantially free of additional tax. | |||||||||
Sales Taxes | Sales Taxes | ||||||||
Sales and other taxes collected from customers and subsequently remitted to government authorities are recorded as cash or accounts receivable with a corresponding offset recorded to sales taxes payable. These balances are removed from the consolidated balance sheet as cash is collected from the customers and remitted to the tax authority. | |||||||||
Earnings Per Share | Earnings Per Share | ||||||||
Basic net income per share is computed using the weighted-average number of shares of our common stock outstanding during the period. Diluted net income per share is computed using the weighted-average number of common and dilutive common equivalent shares outstanding during the period. Common equivalent shares consist of stock options, unvested restricted stock and restricted stock units, the shares issuable under our $1.725 billion 1.75% convertible senior notes due 2013 (the “2013 Notes”) and the associated warrants. See Note E for further information regarding the 2013 Notes and the associated warrants and Note O for further information regarding the calculation of diluted net income per weighted-average share. Additionally, for purposes of calculating diluted net income per common share, net income is adjusted for the difference between VMware’s reported diluted and basic earnings per share, if any, multiplied by the number of shares of VMware held by EMC. | |||||||||
Retirement Benefits | Retirement Benefits | ||||||||
Pension cost for our domestic defined benefit pension plan is funded to the extent that the current pension cost is deductible for U.S. Federal tax purposes and to comply with the Employee Retirement Income Security Act and the General Agreement on Tariff and Trade Bureau additional minimum funding requirements. Net pension cost for our international defined benefit pension plans are generally funded as accrued. | |||||||||
Concentration of Risks | Concentrations of Risks | ||||||||
Financial instruments that potentially subject us to concentration of credit risk consist principally of bank deposits, money market investments, short- and long-term investments, accounts and notes receivable, and foreign currency exchange contracts. Deposits held with banks in the United States may exceed the amount of FDIC insurance provided on such deposits. Deposits held with banks outside the United States generally do not benefit from FDIC insurance. The majority of our day-to-day banking operations globally are maintained with Citibank. We believe that Citibank’s position as a primary clearing bank, coupled with the substantial monitoring of their daily liquidity, both by their internal processes and by the Federal Reserve and the FDIC, mitigate some of our risk. | |||||||||
Our money market investments are placed with money market funds that are 2a-7 qualified. Rule 2a-7, adopted by the United States Securities and Exchange Commission (the “SEC”) under the Investment Company Act of 1940, establishes strict standards for quality, diversity and maturity, the objective of which is to maintain a constant net asset value of a dollar. We limit our investments in money market funds to those that are primarily associated with large, money center financial institutions and limit our exposure to Prime funds. Our short- and long-term investments are invested primarily in investment grade securities, and we limit the amount of our investment in any single issuer. | |||||||||
We provide credit to customers in the normal course of business. Credit is extended to new customers based on checks of credit references, credit scores and industry reputation. Credit is extended to existing customers based on prior payment history and demonstrated financial stability. The credit risk associated with accounts and notes receivables is generally limited due to the large number of customers and their broad dispersion over many different industries and geographic areas. We establish an allowance for the estimated uncollectible portion of our accounts and notes receivable. We customarily sell the notes receivable we derive from our leasing activity. Generally, we do not retain any recourse on the sale of these notes. Our sales are generally dispersed among a large number of customers, minimizing the reliance on any particular customer or group of customers. | |||||||||
The counterparties to our foreign currency exchange contracts consist of a number of major financial institutions. In addition to limiting the amount of contracts we enter into with any one party, we monitor the credit quality of the counterparties on an ongoing basis. | |||||||||
We purchase or license many sophisticated components and products from one or a limited number of qualified suppliers. If any of our suppliers were to cancel or materially change contracts or commitments with us or fail to meet the quality or delivery requirements needed to satisfy customer orders for our products, we could lose customer orders. We attempt to minimize this risk by finding alternative suppliers or maintaining adequate inventory levels to meet our forecasted needs. | |||||||||
Accounting for Stock-Based Compensation | Accounting for Stock-Based Compensation | ||||||||
We have selected the Black-Scholes option-pricing model to determine the fair value of our stock option awards. For stock options, restricted stock and restricted stock units, we recognize compensation cost on a straight-line basis over the awards’ vesting periods for those awards which contain only a service vesting feature. For awards with a performance condition vesting feature, when achievement of the performance condition is deemed probable, we recognize compensation cost on a graded-vesting basis over the awards’ expected vesting periods. | |||||||||
Reclassifications | Reclassifications | ||||||||
Certain prior year amounts have been reclassified to conform with the current year’s presentation. During the first quarter of 2014, the Information Storage segment acquired the Data Computing Appliance and implementation services businesses from the Pivotal segment. The acquisition of these businesses was accounted for as a business combination between entities under common control. We reflected the impact of the transaction in our segment disclosures and included the financial results of the acquired businesses in the Information Storage segment and excluded these from the Pivotal segment for the years ended December 31, 2014 and 2013. None of the segment reclassifications impact EMC’s previously reported consolidated financial statements. See Note S for further discussion of the segment reclassifications. | |||||||||
Recent Accounting Pronouncements | Recent Accounting Pronouncements | ||||||||
In May 2014, the Financial Accounting Standards Board (“FASB”) issued a standard on revenue recognition providing a single, comprehensive revenue recognition model for all contracts with customers. The revenue standard is based on the principle that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard is effective beginning January 1, 2017, with no early adoption permitted. The principles may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of initial application. We are currently evaluating the adoption method options and the impact of the new guidance on our consolidated financial statements. | |||||||||
New Accounting Guidance Recently Adopted | |||||||||
In April 2014, the FASB issued new accounting guidance on reporting discontinued operations and disclosures of disposals of components of an entity which clarifies the scope of what should be reported as discontinued operations and expands required disclosures. | |||||||||
In July 2013, the FASB issued new accounting guidance on the presentation of unrecognized tax benefits. This new guidance requires an entity to present an unrecognized tax benefit, or a portion of an unrecognized tax benefit, as a reduction to a deferred tax asset when a net operating loss carryforward, a similar tax loss or a tax credit carryforward exists, with limited exceptions. | |||||||||
In March 2013, the FASB issued new accounting guidance that requires a parent company to release any related cumulative translation adjustment into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. | |||||||||
The adoption of the new accounting guidance discussed above during 2014 did not have a material impact on our consolidated financial statements. |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2014 | |||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||
Balances in the Allowance Accounts | The balances in the allowance accounts at December 31, 2014 and 2013 were as follows (table in millions): | ||||||||
December 31, | |||||||||
2014 | 2013 | ||||||||
Current | $ | 72 | $ | 62 | |||||
Non-current (included in other assets, net) | 2 | 3 | |||||||
$ | 74 | $ | 65 | ||||||
Estimated Useful Lives of the Assets | Depreciation commences upon placing the asset in service and is recognized on a straight-line basis over the estimated useful lives of the assets, as follows: | ||||||||
Furniture and fixtures | 5-10 years | ||||||||
Equipment and software | 2-10 years | ||||||||
Improvements | 5-31 years | ||||||||
Buildings | 15-51 years | ||||||||
Property, plant and equipment consist of (table in millions): | |||||||||
December 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Furniture and fixtures | $ | 255 | $ | 229 | |||||
Equipment and software | 6,684 | 5,973 | |||||||
Buildings and improvements | 2,308 | 2,089 | |||||||
Land | 162 | 132 | |||||||
Building construction in progress | 134 | 215 | |||||||
9,543 | 8,638 | ||||||||
Accumulated depreciation | (5,777 | ) | (5,160 | ) | |||||
$ | 3,766 | $ | 3,478 | ||||||
Noncontrolling_Interests_Table
Non-controlling Interests (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Noncontrolling Interest [Abstract] | ||||||||
Effect of Changes in Ownership Interest in VMware on Equity | The effect of changes in our ownership interest in VMware on our equity was as follows (table in millions): | |||||||
For the Year Ended | ||||||||
December 31, | December 31, | |||||||
2014 | 2013 | |||||||
Net income attributable to EMC Corporation | $ | 2,714 | $ | 2,889 | ||||
Transfers (to) from the non-controlling interest in VMware, Inc.: | ||||||||
Increase in EMC Corporation’s additional paid-in-capital for VMware’s equity issuances | 87 | 92 | ||||||
Decrease in EMC Corporation’s additional paid-in-capital for VMware’s other equity activity | (741 | ) | (565 | ) | ||||
Net transfers (to) from non-controlling interest | (654 | ) | (473 | ) | ||||
Change from net income attributable to EMC Corporation and transfers from the non-controlling interest in VMware, Inc. | $ | 2,060 | $ | 2,416 | ||||
Acquisitions_Tables
Acquisitions (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | ||||||||||
All 2013 Acquisitions | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Fair Value of Stock Options for Acquisitions, Weighted-Average Assumptions | The fair value of our stock options for all of the aforementioned acquisitions in 2013 was estimated using the following weighted-average assumptions: | |||||||||||
Expected term (in years) | 1.8 | |||||||||||
Expected volatility | 26.4 | % | ||||||||||
Risk-free interest rate | 0.3 | % | ||||||||||
Dividend yield | 1.5 | % | ||||||||||
Allocation of Purchase Price to Intangible Assets | The following represents the aggregate allocation of the purchase price for all of the aforementioned acquisitions to intangible assets (table in millions): | |||||||||||
Developed technology (weighted-average useful life of 5 years) | $ | 138 | ||||||||||
Customer relationships (weighted-average useful life of 4 years) | 34 | |||||||||||
In-process research and development | 10 | |||||||||||
Total intangible assets | $ | 182 | ||||||||||
2012 Acquisitions, excluding Nicira | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Fair Value of Stock Options for Acquisitions, Weighted-Average Assumptions | The fair value of our stock options for all of the aforementioned acquisitions, excluding Nicira, in 2012 was estimated assuming no expected dividends and the following weighted-average assumptions: | |||||||||||
Expected term (in years) | 1.9 | |||||||||||
Expected volatility | 31.6 | % | ||||||||||
Risk-free interest rate | 0.3 | % | ||||||||||
Allocation of Purchase Price to Intangible Assets | The following represents the aggregate allocation of the purchase price for all of the aforementioned acquisitions, excluding Nicira, to intangible assets (table in millions): | |||||||||||
Developed technology (weighted-average useful life of 5 years) | $ | 255 | ||||||||||
Customer relationships (weighted-average useful life of 6 years) | 54 | |||||||||||
Trademarks and tradenames (weighted-average useful life of 3 years) | 2 | |||||||||||
Total intangible assets | $ | 311 | ||||||||||
All 2014 Acquisitions, excluding Airwatch | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Fair Value of Stock Options for Acquisitions, Weighted-Average Assumptions | The fair value of our stock options for all of the aforementioned acquisitions, excluding AirWatch, in 2014 was estimated using the following weighted-average assumptions: | |||||||||||
Expected term (in years) | 2.6 | |||||||||||
Expected volatility | 27.3 | % | ||||||||||
Risk-free interest rate | 0.7 | % | ||||||||||
Dividend yield | 1.7 | % | ||||||||||
Allocation of Purchase Price to Intangible Assets | The following represents the aggregate allocation of the purchase price for all of the aforementioned acquisitions, excluding AirWatch, to intangible assets (table in millions): | |||||||||||
Purchased technology (weighted-average useful life of 6 years) | $ | 460 | ||||||||||
Customer relationships (weighted-average useful life of 5 years) | 10 | |||||||||||
Trademarks and tradenames (weighted-average useful life of 4 years) | 14 | |||||||||||
Total intangible assets | $ | 484 | ||||||||||
VMware | AirWatch | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Allocation of Purchase Price | The following table summarizes the allocation of the consideration to the fair value of the assets acquired and net liabilities assumed, net of cash acquired (table in millions): | |||||||||||
Other current assets | $ | 61 | ||||||||||
Intangible assets: | ||||||||||||
Purchased technology (weighted-average useful life of 6 years) | 118 | |||||||||||
Customer relationships and customer lists (weighted-average useful life of 8 years) | 78 | |||||||||||
Trademarks and tradenames (weighted-average useful life of 8 years) | 40 | |||||||||||
Other (weighted-average useful life of 3 years) | 14 | |||||||||||
Total intangible assets, net, excluding goodwill | 250 | |||||||||||
Goodwill | 868 | |||||||||||
Other assets | 30 | |||||||||||
Total assets acquired | 1,209 | |||||||||||
Unearned revenue | (45 | ) | ||||||||||
Other assumed liabilities, net of acquired assets | (72 | ) | ||||||||||
Total net liabilities assumed | (117 | ) | ||||||||||
Fair value of assets acquired and net liabilities assumed | $ | 1,092 | ||||||||||
VMware | Nicira | ||||||||||||
Business Acquisition [Line Items] | ||||||||||||
Fair Value of Stock Options for Acquisitions, Weighted-Average Assumptions | The fair value of VMware’s stock options for the acquisition of Nicira was estimated using the following weighted-average assumptions: | |||||||||||
Expected term (in years) | 2.7 | |||||||||||
Expected volatility | 35.7 | % | ||||||||||
Risk-free interest rate | 0.3 | % | ||||||||||
Allocation of Purchase Price | The following table summarizes the allocation of the Nicira purchase price (table in millions): | |||||||||||
Intangible assets: | ||||||||||||
Purchased technology (weighted-average useful life of 7 years) | $ | 266 | ||||||||||
Trademarks and tradenames (weighted-average useful life of 10 years) | 20 | |||||||||||
In-process research and development | 49 | |||||||||||
Total intangible assets | 335 | |||||||||||
Goodwill | 893 | |||||||||||
Deferred tax liabilities, net | (77 | ) | ||||||||||
Income tax payable | (50 | ) | ||||||||||
Other assumed liabilities, net of acquired assets | (1 | ) | ||||||||||
Total purchase price | $ | 1,100 | ||||||||||
Intangibles_and_Goodwill_Table
Intangibles and Goodwill (Tables) | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||
Intangible Assets, Excluding Goodwill | Intangible assets, excluding goodwill, as of December 31, 2014 and 2013 consist of (tables in millions): | |||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||
Gross Carrying | Accumulated | Net Book Value | ||||||||||||||||||||||
Amount | Amortization | |||||||||||||||||||||||
Purchased technology | $ | 2,935 | $ | (1,668 | ) | $ | 1,267 | |||||||||||||||||
Patents | 225 | (117 | ) | 108 | ||||||||||||||||||||
Software licenses | 108 | (93 | ) | 15 | ||||||||||||||||||||
Trademarks and tradenames | 226 | (136 | ) | 90 | ||||||||||||||||||||
Customer relationships and customer lists | 1,473 | (974 | ) | 499 | ||||||||||||||||||||
Leasehold interest | 152 | (16 | ) | 136 | ||||||||||||||||||||
Other | 44 | (34 | ) | 10 | ||||||||||||||||||||
Total intangible assets, excluding goodwill | $ | 5,163 | $ | (3,038 | ) | $ | 2,125 | |||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||
Gross Carrying | Accumulated | Net Book Value | ||||||||||||||||||||||
Amount | Amortization | |||||||||||||||||||||||
Purchased technology | $ | 2,356 | $ | (1,429 | ) | $ | 927 | |||||||||||||||||
Patents | 225 | (102 | ) | 123 | ||||||||||||||||||||
Software licenses | 101 | (90 | ) | 11 | ||||||||||||||||||||
Trademarks and tradenames | 171 | (118 | ) | 53 | ||||||||||||||||||||
Customer relationships and customer lists | 1,386 | (855 | ) | 531 | ||||||||||||||||||||
Leasehold interest | 145 | (11 | ) | 134 | ||||||||||||||||||||
Other | 28 | (27 | ) | 1 | ||||||||||||||||||||
Total intangible assets, excluding goodwill | $ | 4,412 | $ | (2,632 | ) | $ | 1,780 | |||||||||||||||||
Amortization Expense on Intangible Assets for the Next Five Years | As of December 31, 2014, amortization expense on intangible assets for the next five years is expected to be as follows (table in millions): | |||||||||||||||||||||||
2015 | $ | 390 | ||||||||||||||||||||||
2016 | 336 | |||||||||||||||||||||||
2017 | 309 | |||||||||||||||||||||||
2018 | 290 | |||||||||||||||||||||||
2019 | 241 | |||||||||||||||||||||||
Total | $ | 1,566 | ||||||||||||||||||||||
Changes in Carrying Amount of Goodwill | Changes in the carrying amount of goodwill, net, on a consolidated basis and by segment, for the year ended December 31, 2014 consists of the following (table in millions): | |||||||||||||||||||||||
Year Ended December 31, 2014 | ||||||||||||||||||||||||
Information | Enterprise | RSA | Pivotal | VMware | Total | |||||||||||||||||||
Storage | Content | Information | Virtual | |||||||||||||||||||||
Division | Security | Infrastructure | ||||||||||||||||||||||
Balance, beginning of the year | $ | 7,486 | $ | 1,487 | $ | 2,203 | $ | 177 | $ | 3,071 | $ | 14,424 | ||||||||||||
Goodwill resulting from acquisitions | 774 | — | — | — | 941 | 1,715 | ||||||||||||||||||
Finalization of purchase price allocations and other, net | — | (1 | ) | — | — | (4 | ) | (5 | ) | |||||||||||||||
Goodwill transferred in acquisition of Pivotal businesses | 6 | — | — | (6 | ) | — | — | |||||||||||||||||
Balance, end of the year | $ | 8,266 | $ | 1,486 | $ | 2,203 | $ | 171 | $ | 4,008 | $ | 16,134 | ||||||||||||
The transfer of goodwill pursuant to the Information Storage segment acquisition of the Data Computing Appliance and implementation services businesses from the Pivotal segment is shown above for the year ended December 31, 2014. The amount of transferred goodwill was determined using the relative fair value method. See Note S for further discussion of the segment disclosures. | ||||||||||||||||||||||||
Changes in the carrying amount of goodwill, net, on a consolidated basis and by segment, for the year ended December 31, 2013 consists of the following (table in millions): | ||||||||||||||||||||||||
Year Ended December 31, 2013 | ||||||||||||||||||||||||
Information | Enterprise | RSA | Pivotal | VMware | Total | |||||||||||||||||||
Storage | Content | Information | Virtual | |||||||||||||||||||||
Division | Security | Infrastructure | ||||||||||||||||||||||
Balance, beginning of the year | $ | 7,442 | $ | 1,484 | $ | 2,022 | $ | — | $ | 2,892 | $ | 13,840 | ||||||||||||
Goodwill resulting from acquisitions | 145 | 1 | 181 | 37 | 233 | 597 | ||||||||||||||||||
Finalization of purchase price allocations and other, net | 11 | 2 | — | — | (26 | ) | (13 | ) | ||||||||||||||||
Goodwill transferred in formation of Pivotal | (112 | ) | — | — | 140 | (28 | ) | — | ||||||||||||||||
Balance, end of the year | $ | 7,486 | $ | 1,487 | $ | 2,203 | $ | 177 | $ | 3,071 | $ | 14,424 | ||||||||||||
Debt_Tables
Debt (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Debt Disclosure [Abstract] | ||||||||
Key Components of Convertible Debt | Our long-term debt as of December 31, 2014 was as follows (dollars in millions): | |||||||
Senior Notes | Issued at Discount | Carrying | ||||||
to Par | Value | |||||||
$2.5 billion 1.875% Notes due 2018 | 99.943 | % | $ | 2,499 | ||||
$2.0 billion 2.650% Notes due 2020 | 99.76 | % | 1,996 | |||||
$1.0 billion 3.375% Notes due 2023 | 99.925 | % | 1,000 | |||||
$ | 5,495 | |||||||
The following table represents the key components of our interest expense on convertible debt (table in millions): | ||||||||
For the year ended | ||||||||
2013 | 2012 | |||||||
Contractual interest expense on the coupon | $ | 27 | $ | 30 | ||||
Amortization of the discount component recognized as interest expense | 58 | 61 | ||||||
Total interest expense on the convertible debt | $ | 85 | $ | 91 | ||||
Fair_Value_of_Financial_Assets1
Fair Value of Financial Assets and Liabilities (Tables) | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||
Composition of Investments | The following tables summarize the composition of our short- and long-term investments at December 31, 2014 and 2013 (tables in millions): | |||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Aggregate | |||||||||||||||||||||
Cost | Gains | (Losses) | Fair Value | |||||||||||||||||||||
U.S. government and agency obligations | $ | 1,951 | $ | 2 | $ | (2 | ) | $ | 1,951 | |||||||||||||||
U.S. corporate debt securities | 1,998 | 1 | (4 | ) | 1,995 | |||||||||||||||||||
High yield corporate debt securities | 570 | 9 | (16 | ) | 563 | |||||||||||||||||||
Asset-backed securities | 53 | — | — | 53 | ||||||||||||||||||||
Municipal obligations | 948 | 2 | — | 950 | ||||||||||||||||||||
Auction rate securities | 29 | — | (2 | ) | 27 | |||||||||||||||||||
Foreign debt securities | 2,566 | 2 | (4 | ) | 2,564 | |||||||||||||||||||
Total fixed income securities | 8,115 | 16 | (28 | ) | 8,103 | |||||||||||||||||||
Publicly traded equity securities | 117 | 103 | (11 | ) | 209 | |||||||||||||||||||
Total | $ | 8,232 | $ | 119 | $ | (39 | ) | $ | 8,312 | |||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Aggregate | |||||||||||||||||||||
Cost | Gains | (Losses) | Fair Value | |||||||||||||||||||||
U.S. government and agency obligations | $ | 3,726 | $ | 4 | $ | (3 | ) | $ | 3,727 | |||||||||||||||
U.S. corporate debt securities | 2,260 | 8 | (2 | ) | 2,266 | |||||||||||||||||||
High yield corporate debt securities | 515 | 19 | (3 | ) | 531 | |||||||||||||||||||
Municipal obligations | 860 | 3 | — | 863 | ||||||||||||||||||||
Auction rate securities | 63 | — | (3 | ) | 60 | |||||||||||||||||||
Foreign debt securities | 2,152 | 6 | (3 | ) | 2,155 | |||||||||||||||||||
Total fixed income securities | 9,576 | 40 | (14 | ) | 9,602 | |||||||||||||||||||
Publicly traded equity securities | 72 | 24 | (1 | ) | 95 | |||||||||||||||||||
Total | $ | 9,648 | $ | 64 | $ | (15 | ) | $ | 9,697 | |||||||||||||||
Fair Value Hierarchy For Financial Assets and Liabilities Measured at Fair Value | The following tables represent our fair value hierarchy for our financial assets and liabilities measured at fair value as of December 31, 2014 and 2013 (in millions): | |||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||
Cash | $ | 2,022 | $ | — | $ | — | $ | 2,022 | ||||||||||||||||
Cash equivalents | 3,710 | 611 | — | 4,321 | ||||||||||||||||||||
U.S. government and agency obligations | 1,141 | 810 | — | 1,951 | ||||||||||||||||||||
U.S. corporate debt securities | — | 1,995 | — | 1,995 | ||||||||||||||||||||
High yield corporate debt securities | — | 563 | — | 563 | ||||||||||||||||||||
Asset-backed securities | — | 53 | — | 53 | ||||||||||||||||||||
Municipal obligations | — | 950 | — | 950 | ||||||||||||||||||||
Auction rate securities | — | — | 27 | 27 | ||||||||||||||||||||
Foreign debt securities | — | 2,564 | — | 2,564 | ||||||||||||||||||||
Publicly traded equity securities | 209 | — | — | 209 | ||||||||||||||||||||
Total cash and investments | $ | 7,082 | $ | 7,546 | $ | 27 | $ | 14,655 | ||||||||||||||||
Other items: | ||||||||||||||||||||||||
Strategic investments carried at cost | $ | — | $ | — | $ | 333 | $ | 333 | ||||||||||||||||
Investment in joint venture | — | — | 37 | 37 | ||||||||||||||||||||
Long-term debt carried at discounted issuance cost | — | (5,544 | ) | — | (5,544 | ) | ||||||||||||||||||
Foreign exchange derivative assets | — | 44 | — | 44 | ||||||||||||||||||||
Foreign exchange derivative liabilities | — | (71 | ) | — | (71 | ) | ||||||||||||||||||
Commodity derivative assets | — | 12 | — | 12 | ||||||||||||||||||||
December 31, 2013 | ||||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||
Cash | $ | 1,725 | $ | — | $ | — | $ | 1,725 | ||||||||||||||||
Cash equivalents | 5,674 | 492 | — | 6,166 | ||||||||||||||||||||
U.S. government and agency obligations | 1,797 | 1,930 | — | 3,727 | ||||||||||||||||||||
U.S. corporate debt securities | — | 2,266 | — | 2,266 | ||||||||||||||||||||
High yield corporate debt securities | — | 531 | — | 531 | ||||||||||||||||||||
Municipal obligations | — | 863 | — | 863 | ||||||||||||||||||||
Auction rate securities | — | — | 60 | 60 | ||||||||||||||||||||
Foreign debt securities | — | 2,155 | — | 2,155 | ||||||||||||||||||||
Publicly traded equity securities | 95 | — | — | 95 | ||||||||||||||||||||
Total cash and investments | $ | 9,291 | $ | 8,237 | $ | 60 | $ | 17,588 | ||||||||||||||||
Other items: | ||||||||||||||||||||||||
Strategic investments carried at cost | $ | — | $ | — | $ | 379 | $ | 379 | ||||||||||||||||
Investment in joint venture | — | — | 35 | 35 | ||||||||||||||||||||
Long-term debt carried at discounted issuance cost | — | (5,419 | ) | — | (5,419 | ) | ||||||||||||||||||
Foreign exchange derivative assets | — | 31 | — | 31 | ||||||||||||||||||||
Foreign exchange derivative liabilities | — | (20 | ) | — | (20 | ) | ||||||||||||||||||
Commodity derivative assets | — | 4 | — | 4 | ||||||||||||||||||||
Unrealized Losses on Investments by Investment Category and Length of Time in Continuous Unrealized Loss Position | Unrealized losses on investments at December 31, 2014 and 2013 by investment category and length of time the investment has been in a continuous unrealized loss position are as follows (table in millions): | |||||||||||||||||||||||
December 31, 2014 | Less Than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||
Fair | Gross | Fair | Gross | Fair | Gross | |||||||||||||||||||
Value | Unrealized | Value | Unrealized | Value | Unrealized | |||||||||||||||||||
Losses | Losses | Losses | ||||||||||||||||||||||
U.S. government and agency obligations | $ | 1,168 | $ | (2 | ) | $ | — | $ | — | $ | 1,168 | $ | (2 | ) | ||||||||||
U.S. corporate debt securities | 1,383 | (4 | ) | — | — | 1,383 | (4 | ) | ||||||||||||||||
High yield corporate debt securities | 244 | (16 | ) | — | — | 244 | (16 | ) | ||||||||||||||||
Auction rate securities | — | — | 27 | (2 | ) | 27 | (2 | ) | ||||||||||||||||
Foreign debt securities | 1,563 | (4 | ) | — | — | 1,563 | (4 | ) | ||||||||||||||||
Publicly traded equity securities | 17 | (9 | ) | 3 | (2 | ) | 20 | (11 | ) | |||||||||||||||
Total | $ | 4,375 | $ | (35 | ) | $ | 30 | $ | (4 | ) | $ | 4,405 | $ | (39 | ) | |||||||||
December 31, 2013 | Less Than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||
Fair | Gross | Fair | Gross | Fair | Gross | |||||||||||||||||||
Value | Unrealized | Value | Unrealized | Value | Unrealized | |||||||||||||||||||
Losses | Losses | Losses | ||||||||||||||||||||||
U.S. government and agency obligations | $ | 1,161 | $ | (3 | ) | $ | 20 | $ | — | $ | 1,181 | $ | (3 | ) | ||||||||||
U.S. corporate debt securities | 532 | (2 | ) | 17 | — | 549 | (2 | ) | ||||||||||||||||
High yield corporate debt securities | 120 | (3 | ) | — | — | 120 | (3 | ) | ||||||||||||||||
Municipal obligations | 51 | — | — | — | 51 | — | ||||||||||||||||||
Auction rate securities | — | — | 60 | (3 | ) | 60 | (3 | ) | ||||||||||||||||
Foreign debt securities | 695 | (3 | ) | 6 | — | 701 | (3 | ) | ||||||||||||||||
Publicly traded equity securities | — | — | 25 | (1 | ) | 25 | (1 | ) | ||||||||||||||||
Total | $ | 2,559 | $ | (11 | ) | $ | 128 | $ | (4 | ) | $ | 2,687 | $ | (15 | ) | |||||||||
Contractual Maturities of Investments | The contractual maturities of fixed income securities held at December 31, 2014 are as follows (table in millions): | |||||||||||||||||||||||
December 31, 2014 | ||||||||||||||||||||||||
Amortized | Aggregate | |||||||||||||||||||||||
Cost Basis | Fair Value | |||||||||||||||||||||||
Due within one year | $ | 1,946 | $ | 1,946 | ||||||||||||||||||||
Due after 1 year through 5 years | 5,332 | 5,330 | ||||||||||||||||||||||
Due after 5 years through 10 years | 548 | 540 | ||||||||||||||||||||||
Due after 10 years | 289 | 287 | ||||||||||||||||||||||
Total | $ | 8,115 | $ | 8,103 | ||||||||||||||||||||
Inventories_Tables
Inventories (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Inventory Disclosure [Abstract] | ||||||||
Components of Inventories | Inventories consist of (table in millions): | |||||||
December 31, | December 31, | |||||||
2014 | 2013 | |||||||
Work-in-process | $ | 627 | $ | 696 | ||||
Finished goods | 649 | 638 | ||||||
$ | 1,276 | $ | 1,334 | |||||
Accounts_and_Notes_Receivable_1
Accounts and Notes Receivable and Allowance for Credit Losses (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Receivables [Abstract] | ||||||||
Contractual Amounts Due Under Leases | The contractual amounts due under the leases we retained as of December 31, 2014 were as follows (table in millions): | |||||||
Year | Contractual Amounts | |||||||
Due Under Leases | ||||||||
Due within one year | $ | 97 | ||||||
Due within two years | 73 | |||||||
Due within three years | 62 | |||||||
Thereafter | 1 | |||||||
Total | 233 | |||||||
Less amounts representing interest | (5 | ) | ||||||
Present value | 228 | |||||||
Current portion (included in accounts and notes receivable) | 94 | |||||||
Long-term portion (included in other assets, net) | $ | 134 | ||||||
Allowance for Credit Losses | The following table presents the activity of our allowance for credit losses related to lease receivables for the years ended December 31, 2014 and 2013 (table in millions): | |||||||
December 31, | December 31, | |||||||
2014 | 2013 | |||||||
Balance, beginning of the period | $ | 9 | $ | 17 | ||||
Recoveries | (7 | ) | (12 | ) | ||||
Provisions | 4 | 4 | ||||||
Balance, end of the period | $ | 6 | $ | 9 | ||||
Property_Plant_and_Equipment_T
Property, Plant and Equipment (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Property, Plant and Equipment [Abstract] | ||||||||
Components of Property, Plant and Equipment | Depreciation commences upon placing the asset in service and is recognized on a straight-line basis over the estimated useful lives of the assets, as follows: | |||||||
Furniture and fixtures | 5-10 years | |||||||
Equipment and software | 2-10 years | |||||||
Improvements | 5-31 years | |||||||
Buildings | 15-51 years | |||||||
Property, plant and equipment consist of (table in millions): | ||||||||
December 31, | December 31, | |||||||
2014 | 2013 | |||||||
Furniture and fixtures | $ | 255 | $ | 229 | ||||
Equipment and software | 6,684 | 5,973 | ||||||
Buildings and improvements | 2,308 | 2,089 | ||||||
Land | 162 | 132 | ||||||
Building construction in progress | 134 | 215 | ||||||
9,543 | 8,638 | |||||||
Accumulated depreciation | (5,777 | ) | (5,160 | ) | ||||
$ | 3,766 | $ | 3,478 | |||||
Accrued_Expenses_Tables
Accrued Expenses (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Payables and Accruals [Abstract] | ||||||||||||
Components of Accrued Expenses | Accrued expenses consist of (table in millions): | |||||||||||
December 31, | December 31, | |||||||||||
2014 | 2013 | |||||||||||
Salaries and benefits | $ | 1,260 | $ | 1,078 | ||||||||
Product warranties | 210 | 289 | ||||||||||
Dividends payable (see Note O) | 237 | 205 | ||||||||||
Partner rebates | 235 | 214 | ||||||||||
Restructuring, current (See Note Q) | 115 | 84 | ||||||||||
Derivatives | 75 | 23 | ||||||||||
Other | 1,009 | 890 | ||||||||||
$ | 3,141 | $ | 2,783 | |||||||||
Activity in Warranty Accrual for Product Warranty | The following represents the activity in our warranty accrual for the years ended December 31, 2014, 2013 and 2012 (table in millions): | |||||||||||
Year Ended December 31, | ||||||||||||
2014 | 2013 | 2012 | ||||||||||
Balance, beginning of the period | $ | 289 | $ | 278 | $ | 255 | ||||||
Provision | 150 | 198 | 182 | |||||||||
Amounts charged to the accrual | (229 | ) | (187 | ) | (159 | ) | ||||||
Balance, end of the period | $ | 210 | $ | 289 | $ | 278 | ||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||
Provision for Income Taxes | Our provision (benefit) for income taxes consists of (table in millions): | ||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Federal: | |||||||||||||||||
Current | $ | 955 | $ | 698 | $ | 792 | |||||||||||
Deferred | (308 | ) | (163 | ) | (80 | ) | |||||||||||
647 | 535 | 712 | |||||||||||||||
State: | |||||||||||||||||
Current | 81 | 84 | 74 | ||||||||||||||
Deferred | (70 | ) | (23 | ) | (12 | ) | |||||||||||
11 | 61 | 62 | |||||||||||||||
Foreign: | |||||||||||||||||
Current | 228 | 192 | 169 | ||||||||||||||
Deferred | (18 | ) | (16 | ) | (25 | ) | |||||||||||
210 | 176 | 144 | |||||||||||||||
Total provision for income taxes | $ | 868 | $ | 772 | $ | 918 | |||||||||||
Reconciliation of Income Tax Provision to Statutory Federal Tax Rate | A reconciliation of our income tax provision to the statutory federal tax rate is as follows: | ||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Statutory federal tax rate | 35 | % | 35 | % | 35 | % | |||||||||||
State taxes, net of federal taxes | 2.6 | 0.7 | 0.5 | ||||||||||||||
Resolution of uncertain tax positions | (0.9 | ) | (0.9 | ) | (0.5 | ) | |||||||||||
Tax rate differential for international jurisdictions and other international related tax items | (11.3 | ) | (15.0 | ) | (13.6 | ) | |||||||||||
U.S. tax credits | (1.9 | ) | (3.8 | ) | (0.2 | ) | |||||||||||
Change in valuation allowance | (2.3 | ) | 0.7 | 0.8 | |||||||||||||
U.S. domestic production activities deduction | (1.8 | ) | (1.5 | ) | (1.3 | ) | |||||||||||
International reorganization of acquired companies | — | 0.6 | 0.3 | ||||||||||||||
Permanent items | 3.9 | 3.8 | 2.8 | ||||||||||||||
Other | (0.2 | ) | 0.4 | 0.3 | |||||||||||||
23.1 | % | 20 | % | 24.1 | % | ||||||||||||
Components of Current and Noncurrent Deferred Tax Assets and Liabilities | The components of the current and non-current deferred tax assets and liabilities are as follows (table in millions): | ||||||||||||||||
31-Dec-14 | December 31, 2013 | ||||||||||||||||
Deferred | Deferred | Deferred | Deferred | ||||||||||||||
Tax | Tax | Tax | Tax | ||||||||||||||
Asset | Liability | Asset | Liability | ||||||||||||||
Current: | |||||||||||||||||
Accounts and notes receivable | $ | 59 | $ | — | $ | 96 | $ | — | |||||||||
Inventory | 73 | — | 73 | — | |||||||||||||
Accrued expenses | 305 | — | 311 | — | |||||||||||||
Deferred revenue | 472 | — | 365 | — | |||||||||||||
Equity | 148 | — | 83 | — | |||||||||||||
Credit carryforwards | 21 | — | 4 | — | |||||||||||||
Net operating losses | 23 | — | 28 | — | |||||||||||||
Total current | 1,101 | — | 960 | — | |||||||||||||
Property, plant and equipment, net | — | (323 | ) | — | (291 | ) | |||||||||||
Intangible and other assets, net | — | (605 | ) | — | (680 | ) | |||||||||||
Equity | 106 | — | 139 | — | |||||||||||||
Deferred revenue | 346 | — | 253 | — | |||||||||||||
Other non-current liabilities | 23 | — | — | (13 | ) | ||||||||||||
Credit carryforward | 234 | — | 280 | — | |||||||||||||
Net operating losses | 93 | — | 78 | — | |||||||||||||
Other comprehensive loss | 103 | — | 109 | — | |||||||||||||
Total non-current | 905 | (928 | ) | 859 | (984 | ) | |||||||||||
Gross deferred tax assets and liabilities | 2,006 | (928 | ) | 1,819 | (984 | ) | |||||||||||
Valuation allowance | (126 | ) | — | (211 | ) | — | |||||||||||
Total deferred tax assets and liabilities | $ | 1,880 | $ | (928 | ) | $ | 1,608 | $ | (984 | ) | |||||||
Rollforward of Gross Consolidated Liability for Unrecognized Income Tax Benefits | The following is a rollforward of our gross consolidated liability for unrecognized income tax benefits for the three years ended December 31 (table in millions): | ||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Unrecognized tax benefits, beginning of year | $ | 266 | $ | 270 | $ | 197 | |||||||||||
Tax positions related to current year: | |||||||||||||||||
Additions | 63 | 37 | 25 | ||||||||||||||
Reductions | — | — | (1 | ) | |||||||||||||
Tax positions related to prior years: | |||||||||||||||||
Additions | 91 | 10 | 64 | ||||||||||||||
Reductions | (31 | ) | (33 | ) | (4 | ) | |||||||||||
Settlements | (1 | ) | (5 | ) | — | ||||||||||||
Lapses in statutes of limitations | (5 | ) | (13 | ) | (11 | ) | |||||||||||
Unrecognized tax benefits, end of year | $ | 383 | $ | 266 | $ | 270 | |||||||||||
Retirement_Plan_Benefits_Table
Retirement Plan Benefits (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Compensation and Retirement Disclosure [Abstract] | |||||||||||||||||
Components of Change in Benefit Obligation of Pension Plans | The components of the change in benefit obligation of the Pension Plan is as follows (table in millions): | ||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Benefit obligation, at beginning of year | $ | 495 | $ | 539 | |||||||||||||
Interest cost | 22 | 20 | |||||||||||||||
Benefits paid | (19 | ) | (18 | ) | |||||||||||||
Actuarial loss (gain) | 56 | (46 | ) | ||||||||||||||
Benefit obligation, at end of year | $ | 554 | $ | 495 | |||||||||||||
Reconciliation of Beginning and Ending Balances of Fair Value of Assets of Pension Plans | The reconciliation of the beginning and ending balances of the fair value of the assets of the Pension Plan is as follows (table in millions): | ||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Fair value of plan assets, at beginning of year | $ | 449 | $ | 431 | |||||||||||||
Actual return on plan assets | 56 | 35 | |||||||||||||||
Employer contributions to plan | — | 1 | |||||||||||||||
Benefits paid | (19 | ) | (18 | ) | |||||||||||||
Fair value of plan assets, at end of year | $ | 486 | $ | 449 | |||||||||||||
Components of Net Periodic Expense of Pension Plans | The components of net periodic expense of the Pension Plan are as follows (table in millions): | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Interest cost | $ | 22 | $ | 20 | |||||||||||||
Expected return on plan assets | (29 | ) | (28 | ) | |||||||||||||
Recognized actuarial loss | 9 | 15 | |||||||||||||||
Net periodic expense | $ | 2 | $ | 7 | |||||||||||||
Weighted Average Assumptions Used in Pension Plans to Determine Benefit Obligations | The weighted-average assumptions used in the Pension Plan to determine benefit obligations at December 31 are as follows: | ||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Discount rate | 3.9 | % | 4.7 | % | 3.7 | % | |||||||||||
Rate of compensation increase | N/A | N/A | N/A | ||||||||||||||
The weighted-average assumptions used in the Pension Plan to determine periodic benefit cost for the years ended December 31 are as follows: | |||||||||||||||||
December 31, | December 31, | December 31, | |||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||
Discount rate | 4.7 | % | 3.7 | % | 4.6 | % | |||||||||||
Expected long-term rate of return on plan assets | 6.75 | % | 6.75 | % | 6.75 | % | |||||||||||
Rate of compensation increase | N/A | N/A | N/A | ||||||||||||||
Weighted Average Assumptions Used in Pension Plans to Determine Periodic Benefit Cost | The benefit payments are expected to be paid in the following years (table in millions): | ||||||||||||||||
2015 | $ | 21 | |||||||||||||||
2016 | 22 | ||||||||||||||||
2017 | 23 | ||||||||||||||||
2018 | 25 | ||||||||||||||||
2019 | 27 | ||||||||||||||||
2020-2024 | 159 | ||||||||||||||||
Pension Plan Assets at Fair Value | The following table sets forth, by level within the fair value hierarchy, the Pension Plan’s assets at fair value as of December 31, 2014 and 2013 (table in millions): | ||||||||||||||||
December 31, 2014 | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Common collective trusts | $ | — | $ | 350 | $ | — | $ | 350 | |||||||||
U.S. Treasury securities | 2 | — | — | 2 | |||||||||||||
Corporate debt securities | — | 132 | — | 132 | |||||||||||||
Total | $ | 2 | $ | 482 | $ | — | 484 | ||||||||||
Plan payables, net of accrued interest and dividends | 2 | ||||||||||||||||
Total | $ | 486 | |||||||||||||||
December 31, 2013 | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Common collective trusts | $ | — | $ | 330 | $ | — | $ | 330 | |||||||||
U.S. Treasury securities | 2 | — | — | 2 | |||||||||||||
Corporate debt securities | — | 114 | — | 114 | |||||||||||||
Total | $ | 2 | $ | 444 | $ | — | 446 | ||||||||||
Plan payables, net of accrued interest and dividends | 3 | ||||||||||||||||
Total | $ | 449 | |||||||||||||||
Pension Plan Investments at Fair Value Represented 5% or More of Pension Plan Net Assets | Pension Plan investments at fair value as of December 31, 2014 and 2013 which represented 5% or more of the Pension Plan’s net assets were as follows (table in millions): | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
EB Daily Valued Small Cap Stock Index Fund | $ | 30 | $ | 30 | |||||||||||||
EB Daily Valued Stock Index Fund | 103 | 104 | |||||||||||||||
EB Daily Valued International Stock Index Fund | 27 | 30 | |||||||||||||||
EB Long Term Government Bond Index | 50 | 40 | |||||||||||||||
EB Long Term Credit Bond Index | 74 | 63 | |||||||||||||||
Corporate Debt Securities | — | 118 | |||||||||||||||
Custom Long Duration Fixed Income | 137 | — | |||||||||||||||
$ | 421 | $ | 385 | ||||||||||||||
Weighted Average Target Asset Allocations | The long-term weighted average target asset allocations are as follows: | ||||||||||||||||
December 31, 2014 | |||||||||||||||||
U.S. large capitalization equities | 17 | % | |||||||||||||||
U.S. small capitalization equities | 4 | ||||||||||||||||
International equities | 4 | ||||||||||||||||
U.S. long-duration fixed income | 75 | ||||||||||||||||
Total | 100 | % | |||||||||||||||
Actual Allocation of the Assets in the Pension Plans | The actual allocation of the assets in the Pension Plan at December 31, 2014 and 2013 were as follows: | ||||||||||||||||
December 31, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
U.S. large capitalization equities | 30 | % | 33 | % | |||||||||||||
U.S. small capitalization equities | 6 | 7 | |||||||||||||||
International equities | 7 | 8 | |||||||||||||||
U.S. long-duration fixed income | 54 | 49 | |||||||||||||||
High yield fixed income | — | 3 | |||||||||||||||
Below Investment Grade Corporate Fixed Income | 3 | — | |||||||||||||||
Total | 100 | % | 100 | % |
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||
Rent Expense on Operating Leases | Rent expense was as follows (table in millions): | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
Rent expense | $ | 361 | $ | 328 | $ | 312 | |||||||
Sublease proceeds | (2 | ) | (2 | ) | (4 | ) | |||||||
Net rent expense | $ | 359 | $ | 326 | $ | 308 | |||||||
Future Operating Lease Commitments | Our future operating lease commitments as of December 31, 2014 are as follows (table in millions): | ||||||||||||
2015 | $ | 328 | |||||||||||
2016 | 281 | ||||||||||||
2017 | 224 | ||||||||||||
2018 | 162 | ||||||||||||
2019 | 117 | ||||||||||||
Thereafter | 826 | ||||||||||||
Total minimum lease payments | $ | 1,938 | |||||||||||
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||
Stockholders' Equity Note [Abstract] | ||||||||||||||||||||||||
Reconciliation from Basic to Diluted Earnings Per Share | The reconciliation from basic to diluted earnings per share for both the numerators and denominators is as follows (table in millions): | |||||||||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||||||||
Numerator: | ||||||||||||||||||||||||
Net income attributable to EMC Corporation | $ | 2,714 | $ | 2,889 | $ | 2,733 | ||||||||||||||||||
Incremental dilution from VMware | (7 | ) | (8 | ) | (10 | ) | ||||||||||||||||||
Net income – dilution attributable to EMC Corporation | $ | 2,707 | $ | 2,881 | $ | 2,723 | ||||||||||||||||||
Denominator: | ||||||||||||||||||||||||
Weighted average shares, basic | 2,028 | 2,074 | 2,093 | |||||||||||||||||||||
Weighted average common stock equivalents | 26 | 28 | 40 | |||||||||||||||||||||
Assumed conversion of the 2013 Notes and associated warrants | 5 | 58 | 73 | |||||||||||||||||||||
Weighted average shares, diluted | 2,059 | 2,160 | 2,206 | |||||||||||||||||||||
Dividends Declared | Our Board of Directors declared the following dividends during the periods presented: | |||||||||||||||||||||||
Declaration Date | Dividend Per Share | Record Date | Total Amount (in millions) | Payment Date | ||||||||||||||||||||
Fiscal Year 2014: | ||||||||||||||||||||||||
February 6, 2014 | $ | 0.1 | April 1, 2014 | $ | 209 | April 23, 2014 | ||||||||||||||||||
April 17, 2014 | $ | 0.115 | July 1, 2014 | $ | 237 | July 23, 2014 | ||||||||||||||||||
July 30, 2014 | $ | 0.115 | October 1, 2014 | $ | 239 | October 23, 2014 | ||||||||||||||||||
9-Dec-14 | $ | 0.115 | January 2, 2015 | $ | 234 | January 23, 2015 | ||||||||||||||||||
Fiscal Year 2013: | ||||||||||||||||||||||||
May 30, 2013 | $ | 0.1 | July 1, 2013 | $ | 212 | July 23, 2013 | ||||||||||||||||||
August 1, 2013 | $ | 0.1 | October 1, 2013 | $ | 210 | October 23, 2013 | ||||||||||||||||||
December 12, 2013 | $ | 0.1 | January 8, 2014 | $ | 206 | January 23, 2014 | ||||||||||||||||||
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive Income (Loss) | |||||||||||||||||||||||
Changes in accumulated other comprehensive income (loss), which is presented net of tax, for the years ended December 31, 2014 and 2013 consist of the following (table in millions): | ||||||||||||||||||||||||
Foreign Currency Translation Adjustments | Unrealized Net Gains on Investments | Unrealized Net Losses on Derivatives | Recognition of Actuarial Net Loss from Pension and Other Postretirement Plans | Accumulated Other Comprehensive Income Attributable to the Non-controlling Interest in VMware, Inc. | Total | |||||||||||||||||||
Balance as of January 1, 2013(a) | $ | (9 | ) | $ | 64 | $ | (109 | ) | $ | (153 | ) | $ | (1 | ) | $ | (208 | ) | |||||||
Other comprehensive income (loss) before reclassifications | (44 | ) | (22 | ) | 13 | 34 | — | (19 | ) | |||||||||||||||
Net losses (gains) reclassified from accumulated other comprehensive income | — | (11 | ) | (10 | ) | 9 | — | (12 | ) | |||||||||||||||
Net current period other comprehensive income (loss) | (44 | ) | (33 | ) | 3 | 43 | — | (31 | ) | |||||||||||||||
Balance as of December 31, 2013(b) | (53 | ) | 31 | (106 | ) | (110 | ) | (1 | ) | (239 | ) | |||||||||||||
Other comprehensive income (loss) before reclassifications | (135 | ) | 57 | 24 | (22 | ) | — | (76 | ) | |||||||||||||||
Net losses (gains) reclassified from accumulated other comprehensive income | — | (39 | ) | (18 | ) | 6 | — | (51 | ) | |||||||||||||||
Net current period other comprehensive income (loss) | (135 | ) | 18 | 6 | (16 | ) | — | (127 | ) | |||||||||||||||
Balance as of December 31, 2014(c) | $ | (188 | ) | $ | 49 | $ | (100 | ) | $ | (126 | ) | $ | (1 | ) | $ | (366 | ) | |||||||
(a) | Net of taxes (benefits) of $37 million for unrealized net gains on investments, $(67) million for unrealized net losses on derivatives and $(87) million for actuarial net loss on pension plans. | |||||||||||||||||||||||
(b) | Net of taxes (benefits) of $18 million for unrealized net gains on investments, $(66) million for unrealized net losses on derivatives and $(61) million for actuarial net loss on pension plans. | |||||||||||||||||||||||
(c) | Net of taxes (benefits) of $31 million for unrealized net gains on investments, $(64) million for unrealized net losses on derivatives and $(70) million for actuarial net loss on pension plans. | |||||||||||||||||||||||
The amounts reclassified out of accumulated other comprehensive income (loss) for the years ended December 31, 2014 and 2013 is as follows (table in millions): | ||||||||||||||||||||||||
For the Year Ended | ||||||||||||||||||||||||
Accumulated Other Comprehensive Income Components | 31-Dec-14 | 31-Dec-13 | Impacted Line Item on | |||||||||||||||||||||
Consolidated Income Statements | ||||||||||||||||||||||||
Net gain on investments: | $ | 62 | $ | 17 | Investment income | |||||||||||||||||||
(23 | ) | (6 | ) | Provision for income tax | ||||||||||||||||||||
Net of tax | $ | 39 | $ | 11 | ||||||||||||||||||||
Net gain on derivatives: | ||||||||||||||||||||||||
Foreign exchange contracts | $ | 39 | $ | 12 | Product sales revenue | |||||||||||||||||||
Foreign exchange contracts | (10 | ) | — | Cost of product sales | ||||||||||||||||||||
Interest rate swap | (11 | ) | — | Other interest expense | ||||||||||||||||||||
Total net gain on derivatives before tax | 18 | 12 | ||||||||||||||||||||||
— | (2 | ) | Provision for income tax | |||||||||||||||||||||
Net of tax | $ | 18 | $ | 10 | ||||||||||||||||||||
Net loss from pension and other postretirement plans | $ | (9 | ) | $ | (15 | ) | Selling, general and administrative expense | |||||||||||||||||
3 | 6 | Benefit for income tax | ||||||||||||||||||||||
Net of tax | $ | (6 | ) | $ | (9 | ) | ||||||||||||||||||
VMware | ||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||||||||||||
Schedule of Stock Repurchase Activity | The following table summarizes stock repurchase activity in the years ended December 31, 2014, 2013 and 2012 (table in millions, except per share amounts): | |||||||||||||||||||||||
For the Year Ended December 31, | ||||||||||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||||||||
Aggregate purchase price | $ | 700 | $ | 508 | $ | 468 | ||||||||||||||||||
Class A common shares repurchased | 8 | 7 | 5 | |||||||||||||||||||||
Weighted-average price per share | $ | 91.61 | $ | 76.58 | $ | 91.1 | ||||||||||||||||||
Schedule of Repurchase Agreements | The following table summarizes stock repurchase authorizations in the years ended December 31, 2014, 2013 and 2012 (amounts in table in millions): | |||||||||||||||||||||||
Month Authorized | Amount Authorized | Expiration Date | Status | |||||||||||||||||||||
Aug-14 | $ | 1,000 | End of 2016 | Open | ||||||||||||||||||||
Aug-13 | 700 | End of 2015 | Completed in Q4’14 | |||||||||||||||||||||
Nov-12 | 250 | End of 2014 | Completed in Q4’13 | |||||||||||||||||||||
Feb-12 | 600 | End of 2013 | Completed in Q2’13 | |||||||||||||||||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||
Components of Stock-Based Compensation Expense | The following tables summarize the components of total stock-based compensation expense included in our consolidated income statements in 2014, 2013 and 2012 (in millions): | ||||||||||||
Year Ended December 31, 2014 | |||||||||||||
Stock Options | Restricted | Total Stock-Based | |||||||||||
Stock | Compensation | ||||||||||||
Cost of product sales | $ | 16 | $ | 38 | $ | 54 | |||||||
Cost of services | 20 | 72 | 92 | ||||||||||
Research and development | 79 | 303 | 382 | ||||||||||
Selling, general and administrative | 78 | 415 | 493 | ||||||||||
Stock-based compensation expense before income taxes | 193 | 828 | 1,021 | ||||||||||
Income tax benefit | 45 | 179 | 224 | ||||||||||
Total stock-based compensation, net of tax | $ | 148 | $ | 649 | $ | 797 | |||||||
Year Ended December 31, 2013 | |||||||||||||
Stock Options | Restricted | Total Stock-Based | |||||||||||
Stock | Compensation | ||||||||||||
Cost of product sales | $ | 19 | $ | 29 | $ | 48 | |||||||
Cost of services | 15 | 61 | 76 | ||||||||||
Research and development | 75 | 282 | 357 | ||||||||||
Selling, general and administrative | 82 | 372 | 454 | ||||||||||
Stock-based compensation expense before income taxes | 191 | 744 | 935 | ||||||||||
Income tax benefit | 56 | 170 | 226 | ||||||||||
Total stock-based compensation, net of tax | $ | 135 | $ | 574 | $ | 709 | |||||||
Year Ended December 31, 2012 | |||||||||||||
Stock Options | Restricted | Total Stock-Based | |||||||||||
Stock | Compensation | ||||||||||||
Cost of product sales | $ | 22 | $ | 30 | $ | 52 | |||||||
Cost of services | 21 | 53 | 74 | ||||||||||
Research and development | 88 | 236 | 324 | ||||||||||
Selling, general and administrative | 131 | 339 | 470 | ||||||||||
Stock-based compensation expense before income taxes | 262 | 658 | 920 | ||||||||||
Income tax benefit | 68 | 162 | 230 | ||||||||||
Total stock-based compensation, net of tax | $ | 194 | $ | 496 | $ | 690 | |||||||
Net Change in Amounts Capitalized or Accrued | The table below presents the net change in amounts capitalized or accrued in 2014 and 2013 for the following items (in millions): | ||||||||||||
Increased (decreased) | Increased (decreased) | ||||||||||||
during the year ended | during the year ended | ||||||||||||
December 31, 2014 | December 31, 2013 | ||||||||||||
Accrued expenses (accrued warranty expenses) | $ | — | $ | (1 | ) | ||||||||
Other assets | (19 | ) | 2 | ||||||||||
EMC Employee Stock Purchase - 1989 Plan | |||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||
Employee Stock Purchase Plan Activity | The following table summarizes the 1989 Plan activity in the years ended December 31, 2014, 2013 and 2012 (table in millions, except per share amounts): | ||||||||||||
For the Year Ended | |||||||||||||
December 31, 2014 | December 31, 2013 | December 31, 2012 | |||||||||||
Cash proceeds | $ | 186 | $ | 82 | $ | 154 | |||||||
Common shares purchased | 8 | 4 | 7 | ||||||||||
Weighted-average price per share | $ | 22.44 | $ | 20.08 | $ | 21.65 | |||||||
EMC | |||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||
Stock Option Activity | The following table summarizes our option activity under all equity plans since January 1, 2012 (shares in millions): | ||||||||||||
Number of | Weighted Average | ||||||||||||
Shares | Exercise Price | ||||||||||||
(per share) | |||||||||||||
Outstanding, January 1, 2012 | 112 | $ | 13.69 | ||||||||||
Options granted relating to business acquisitions | 2 | 1.54 | |||||||||||
Granted | 1 | 26.8 | |||||||||||
Forfeited | (2 | ) | 13.75 | ||||||||||
Expired | (1 | ) | 14.19 | ||||||||||
Exercised | (35 | ) | 11.65 | ||||||||||
Outstanding, December 31, 2012 | 77 | 14.39 | |||||||||||
Options granted relating to business acquisitions | 1 | 3.29 | |||||||||||
Granted | — | — | |||||||||||
Forfeited | (1 | ) | 13.36 | ||||||||||
Expired | — | — | |||||||||||
Exercised | (20 | ) | 13.1 | ||||||||||
Outstanding, December 31, 2013 | 57 | 14.56 | |||||||||||
Options granted relating to business acquisitions | 8 | 0.62 | |||||||||||
Granted | — | — | |||||||||||
Forfeited | (1 | ) | 13.55 | ||||||||||
Expired | — | — | |||||||||||
Exercised | (24 | ) | 13.19 | ||||||||||
Outstanding, December 31, 2014 | 40 | 12.68 | |||||||||||
Exercisable, December 31, 2014 | 31 | 15.27 | |||||||||||
Vested and expected to vest, December 31, 2014 | 39 | $ | 13.06 | ||||||||||
Restricted Stock and Restricted Stock Unit Activity | The following table summarizes our restricted stock and restricted stock unit activity since January 1, 2012 (shares in millions): | ||||||||||||
Number of | Weighted Average | ||||||||||||
Shares | Grant Date | ||||||||||||
Fair Value | |||||||||||||
Restricted stock and restricted stock units at January 1, 2012 | 46 | $ | 21.1 | ||||||||||
Granted | 21 | 26.57 | |||||||||||
Vested | (16 | ) | 18.92 | ||||||||||
Forfeited | (4 | ) | 23.09 | ||||||||||
Outstanding, December 31, 2012 | 47 | 24.39 | |||||||||||
Granted | 20 | 25.55 | |||||||||||
Vested | (15 | ) | 22.61 | ||||||||||
Forfeited | (4 | ) | 24.8 | ||||||||||
Outstanding, December 31, 2013 | 48 | 25.43 | |||||||||||
Granted | 23 | 27.65 | |||||||||||
Vested | (14 | ) | 24.89 | ||||||||||
Forfeited | (4 | ) | 25.63 | ||||||||||
Restricted stock and restricted stock units at December 31, 2014 | 53 | $ | 26.5 | ||||||||||
Weighted Average Assumptions Used to Estimate Fair Value of Awards | The fair value of each option granted during the year ended December 31, 2012 was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions: | ||||||||||||
EMC Stock Options | For the Year Ended December 31, 2012 | ||||||||||||
Dividend yield | None | ||||||||||||
Expected volatility | 34.3 | % | |||||||||||
Risk-free interest rate | 0.8 | % | |||||||||||
Expected term (in years) | 5.2 | ||||||||||||
Weighted-average fair value at grant date | $ | 8.56 | |||||||||||
VMware | |||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||||
Employee Stock Purchase Plan Activity | The following table summarizes ESPP activity in the years ended December 31, 2014, 2013 and 2012 (table in millions, except per share amounts): | ||||||||||||
For the Year Ended | |||||||||||||
December 31, 2014 | December 31, 2013 | December 31, 2012 | |||||||||||
Cash proceeds | $ | 80 | $ | 76 | $ | 69 | |||||||
Class A common shares purchased | 1 | 1 | 1 | ||||||||||
Weighted-average price per share | $ | 73.21 | $ | 65.97 | $ | 77.34 | |||||||
Stock Option Activity | The following table summarizes activity since January 1, 2012 for VMware employees in VMware stock options (shares in millions): | ||||||||||||
Number of | Weighted Average | ||||||||||||
Shares | Exercise Price | ||||||||||||
(per share) | |||||||||||||
Outstanding, January 1, 2012 | 16 | $ | 35.27 | ||||||||||
Granted | 1 | 4.67 | |||||||||||
Forfeited | (1 | ) | 42.07 | ||||||||||
Exercised | (6 | ) | 30.44 | ||||||||||
Outstanding, December 31, 2012 | 10 | 34.36 | |||||||||||
Granted | 1 | 71.53 | |||||||||||
Exercised | (5 | ) | 28.12 | ||||||||||
Outstanding, December 31, 2013 | 6 | 44.12 | |||||||||||
Granted | 2 | 50.91 | |||||||||||
Exercised | (2 | ) | 35.58 | ||||||||||
Outstanding, December 31, 2014 | 6 | 50.54 | |||||||||||
Exercisable, December 31, 2014 | 3 | 37.4 | |||||||||||
Vested and expected to vest | 6 | $ | 48.57 | ||||||||||
Restricted Stock and Restricted Stock Unit Activity | The following table summarizes restricted stock activity since January 1, 2012 (units in millions): | ||||||||||||
Number of | Weighted Average | ||||||||||||
Units | Grant Date | ||||||||||||
Fair Value | |||||||||||||
(per unit) | |||||||||||||
Restricted stock at January 1, 2012 | 10 | $ | 72.74 | ||||||||||
Granted | 8 | 101.73 | |||||||||||
Vested | (4 | ) | 69.01 | ||||||||||
Forfeited | (2 | ) | 81.53 | ||||||||||
Outstanding, December 31, 2012 | 12 | 91.93 | |||||||||||
Granted | 7 | 76.2 | |||||||||||
Vested | (4 | ) | 83.21 | ||||||||||
Forfeited | (2 | ) | 90.55 | ||||||||||
Outstanding, December 31, 2013 | 13 | 85.85 | |||||||||||
Granted | 6 | 92.82 | |||||||||||
Vested | (5 | ) | 86.27 | ||||||||||
Forfeited | (1 | ) | 88.03 | ||||||||||
Outstanding, December 31, 2014 | 13 | $ | 88.88 | ||||||||||
Weighted Average Assumptions Used to Estimate Fair Value of Awards | The fair value of each option to acquire VMware Class A common stock granted during the years ended December 31, 2014, 2013 and 2012 was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions: | ||||||||||||
For the Year Ended | |||||||||||||
December 31, | |||||||||||||
VMware Stock Options | 2014 | 2013 | 2012 | ||||||||||
Dividend yield | None | None | None | ||||||||||
Expected volatility | 36.2 | % | 38.5 | % | 35.8 | % | |||||||
Risk-free interest rate | 0.9 | % | 0.9 | % | 0.3 | % | |||||||
Expected term (in years) | 3.2 | 3.6 | 2.6 | ||||||||||
Weighted-average fair value at grant date | $ | 48.47 | $ | 29.47 | $ | 80.45 | |||||||
For the Year Ended | |||||||||||||
December 31, | |||||||||||||
VMware Employee Stock Purchase Plan | 2014 | 2013 | 2012 | ||||||||||
Dividend yield | None | None | None | ||||||||||
Expected volatility | 32.3 | % | 32.9 | % | 37.8 | % | |||||||
Risk-free interest rate | 0.1 | % | 0.1 | % | 0.1 | % | |||||||
Expected term (in years) | 0.5 | 0.5 | 0.5 | ||||||||||
Weighted-average fair value at grant date | $ | 20.71 | $ | 20.45 | $ | 23.36 | |||||||
Restructuring_and_AcquisitionR1
Restructuring and Acquisition-Related Charges (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2014 | ||||||||||||||||
Restructuring and Related Activities [Abstract] | ||||||||||||||||
Activity for the Restructuring Programs | The activity for the restructuring programs is presented below (tables in millions): | |||||||||||||||
Year Ended, December 31, 2014: | ||||||||||||||||
2014 EMC Program | ||||||||||||||||
Category | Balance as of December 31, 2013 | 2014 Charges | Utilization | Balance as of December 31, 2014 | ||||||||||||
Workforce reductions | $ | — | $ | 212 | $ | (115 | ) | $ | 97 | |||||||
Consolidation of excess facilities and other contractual obligations | — | 18 | (12 | ) | 6 | |||||||||||
Total | $ | — | $ | 230 | $ | (127 | ) | $ | 103 | |||||||
2014 VMware Program | ||||||||||||||||
Category | Balance as of December 31, 2013 | 2014 Charges | Utilization | Balance as of December 31, 2014 | ||||||||||||
Workforce reductions | $ | — | $ | 18 | $ | (10 | ) | $ | 8 | |||||||
Consolidation of excess facilities and other contractual obligations | — | — | — | — | ||||||||||||
Total | $ | — | $ | 18 | $ | (10 | ) | $ | 8 | |||||||
Other EMC Programs | ||||||||||||||||
Category | Balance as of December 31, 2013 | Adjustments to the Provision | Utilization | Balance as of December 31, 2014 | ||||||||||||
Workforce reductions | $ | 66 | $ | (20 | ) | $ | (41 | ) | $ | 5 | ||||||
Consolidation of excess facilities and other contractual obligations | 24 | — | (11 | ) | 13 | |||||||||||
Total | $ | 90 | $ | (20 | ) | $ | (52 | ) | $ | 18 | ||||||
Year Ended, December 31, 2013: | ||||||||||||||||
EMC Programs | ||||||||||||||||
Category | Balance as of December 31, 2012 | 2013 | Utilization | Balance as of December 31, 2013 | ||||||||||||
Charges | ||||||||||||||||
Workforce reductions | $ | 63 | $ | 121 | $ | (118 | ) | $ | 66 | |||||||
Consolidation of excess facilities and other contractual obligations | 28 | 18 | (22 | ) | 24 | |||||||||||
Total | $ | 91 | $ | 139 | $ | (140 | ) | $ | 90 | |||||||
VMware Programs | ||||||||||||||||
Category | Balance as of December 31, 2012 | 2013 | Utilization | Balance as of December 31, 2013 | ||||||||||||
Charges | ||||||||||||||||
Workforce reductions | $ | — | $ | 54 | $ | (54 | ) | $ | — | |||||||
Consolidation of excess facilities and other contractual obligations | — | — | — | — | ||||||||||||
Total | $ | — | $ | 54 | $ | (54 | ) | $ | — | |||||||
Year Ended, December 31, 2012: | ||||||||||||||||
EMC Programs | ||||||||||||||||
Category | Balance as of | 2012 | Utilization | Balance as of December 31, 2012 | ||||||||||||
31-Dec-11 | Charges | |||||||||||||||
Workforce reductions | $ | 50 | $ | 80 | $ | (67 | ) | $ | 63 | |||||||
Consolidation of excess facilities and other contractual obligations | 30 | 21 | (23 | ) | 28 | |||||||||||
Total | $ | 80 | $ | 101 | $ | (90 | ) | $ | 91 | |||||||
Segment_Information_Tables
Segment Information (Tables) | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2014 | ||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||
Segment Information | Our segment information for the years ended 2014, 2013 and 2012 are as follows (tables in millions, except percentages): | |||||||||||||||||||||||
EMC Information Infrastructure | ||||||||||||||||||||||||
Information | Enterprise Content Division | RSA | EMC | Pivotal | EMC Information Infrastructure plus Pivotal | |||||||||||||||||||
Storage | Information | Information | ||||||||||||||||||||||
Security | Infrastructure | |||||||||||||||||||||||
2014 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Product revenues | $ | 10,785 | $ | 164 | $ | 462 | $ | 11,411 | $ | 65 | $ | 11,476 | ||||||||||||
Services revenues | 5,757 | 476 | 573 | 6,806 | 162 | 6,968 | ||||||||||||||||||
Total consolidated revenues | 16,542 | 640 | 1,035 | 18,217 | 227 | 18,444 | ||||||||||||||||||
Gross profit | $ | 9,180 | $ | 417 | $ | 698 | $ | 10,295 | $ | 106 | $ | 10,401 | ||||||||||||
Gross profit percentage | 55.5 | % | 65.2 | % | 67.4 | % | 56.5 | % | 46.5 | % | 56.4 | % | ||||||||||||
Research and development | 1,489 | 128 | 1,617 | |||||||||||||||||||||
Selling, general and administrative | 4,583 | 183 | 4,766 | |||||||||||||||||||||
Restructuring and acquisition-related charges | — | — | — | |||||||||||||||||||||
Total costs and expenses | 6,072 | 311 | 6,383 | |||||||||||||||||||||
Operating income (loss) | $ | 4,223 | $ | (205 | ) | $ | 4,018 | |||||||||||||||||
EMC | VMware | Corp | Consolidated | |||||||||||||||||||||
Information | Virtual | Reconciling | ||||||||||||||||||||||
Infrastructure plus Pivotal | Infrastructure | Items | ||||||||||||||||||||||
within EMC | ||||||||||||||||||||||||
2014 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Product revenues | $ | 11,476 | $ | 2,575 | $ | — | $ | 14,051 | ||||||||||||||||
Services revenues | 6,968 | 3,421 | — | 10,389 | ||||||||||||||||||||
Total consolidated revenues | 18,444 | 5,996 | — | 24,440 | ||||||||||||||||||||
Gross profit | $ | 10,401 | $ | 5,241 | $ | (393 | ) | $ | 15,249 | |||||||||||||||
Gross profit percentage | 56.4 | % | 87.4 | % | — | 62.4 | % | |||||||||||||||||
Research and development | 1,617 | 987 | 387 | 2,991 | ||||||||||||||||||||
Selling, general and administrative | 4,766 | 2,390 | 826 | 7,982 | ||||||||||||||||||||
Restructuring and acquisition-related charges | — | — | 239 | 239 | ||||||||||||||||||||
Total costs and expenses | 6,383 | 3,377 | 1,452 | 11,212 | ||||||||||||||||||||
Operating income | 4,018 | 1,864 | (1,845 | ) | 4,037 | |||||||||||||||||||
Non-operating income (expense) | (362 | ) | 34 | 53 | (275 | ) | ||||||||||||||||||
Income tax provision | 942 | 385 | (459 | ) | 868 | |||||||||||||||||||
Net income | 2,714 | 1,513 | (1,333 | ) | 2,894 | |||||||||||||||||||
Net income attributable to the non-controlling interest in VMware, Inc. | — | (308 | ) | 128 | (180 | ) | ||||||||||||||||||
Net income attributable to EMC Corporation | $ | 2,714 | $ | 1,205 | $ | (1,205 | ) | $ | 2,714 | |||||||||||||||
EMC Information Infrastructure | ||||||||||||||||||||||||
Information | Enterprise Content Division | RSA | EMC | Pivotal | EMC Information Infrastructure plus Pivotal | |||||||||||||||||||
Storage | Information | Information | ||||||||||||||||||||||
Security | Infrastructure | |||||||||||||||||||||||
2013 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Product revenues | $ | 10,738 | $ | 180 | $ | 453 | $ | 11,371 | $ | 66 | $ | 11,437 | ||||||||||||
Services revenues | 5,524 | 467 | 534 | 6,525 | 113 | 6,638 | ||||||||||||||||||
Total consolidated revenues | 16,262 | 647 | 987 | 17,896 | 179 | 18,075 | ||||||||||||||||||
Gross profit | $ | 9,109 | $ | 419 | $ | 655 | $ | 10,183 | $ | 91 | $ | 10,274 | ||||||||||||
Gross profit percentage | 56 | % | 64.8 | % | 66.4 | % | 56.9 | % | 50.7 | % | 56.8 | % | ||||||||||||
Research and development | 1,461 | 109 | 1,570 | |||||||||||||||||||||
Selling, general and administrative | 4,571 | 161 | 4,732 | |||||||||||||||||||||
Restructuring and acquisition-related charges | — | — | — | |||||||||||||||||||||
Total costs and expenses | 6,032 | 270 | 6,302 | |||||||||||||||||||||
Operating income (loss) | $ | 4,151 | $ | (179 | ) | $ | 3,972 | |||||||||||||||||
EMC | VMware | Corp | Consolidated | |||||||||||||||||||||
Information | Virtual | Reconciling | ||||||||||||||||||||||
Infrastructure plus Pivotal | Infrastructure | Items | ||||||||||||||||||||||
within EMC | ||||||||||||||||||||||||
2013 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Product revenues | $ | 11,437 | $ | 2,253 | $ | — | $ | 13,690 | ||||||||||||||||
Services revenues | 6,638 | 2,894 | — | 9,532 | ||||||||||||||||||||
Total consolidated revenues | 18,075 | 5,147 | — | 23,222 | ||||||||||||||||||||
Gross profit | $ | 10,274 | $ | 4,589 | $ | (390 | ) | $ | 14,473 | |||||||||||||||
Gross profit percentage | 56.8 | % | 89.2 | % | — | 62.3 | % | |||||||||||||||||
Research and development | 1,570 | 826 | 365 | 2,761 | ||||||||||||||||||||
Selling, general and administrative | 4,732 | 2,003 | 603 | 7,338 | ||||||||||||||||||||
Restructuring and acquisition-related charges | — | — | 224 | 224 | ||||||||||||||||||||
Total costs and expenses | 6,302 | 2,829 | 1,192 | 10,323 | ||||||||||||||||||||
Operating income | 3,972 | 1,760 | (1,582 | ) | 4,150 | |||||||||||||||||||
Non-operating income (expense) | (337 | ) | 22 | 30 | (285 | ) | ||||||||||||||||||
Income tax provision | 911 | 317 | (456 | ) | 772 | |||||||||||||||||||
Net income | 2,724 | 1,465 | (1,096 | ) | 3,093 | |||||||||||||||||||
Net income attributable to the non-controlling interest in VMware, Inc. | — | (295 | ) | 91 | (204 | ) | ||||||||||||||||||
Net income attributable to EMC Corporation | $ | 2,724 | $ | 1,170 | $ | (1,005 | ) | $ | 2,889 | |||||||||||||||
EMC Information Infrastructure | ||||||||||||||||||||||||
Information | Enterprise Content Division | RSA | EMC | Pivotal | EMC Information Infrastructure plus Pivotal | |||||||||||||||||||
Storage | Information | Information | ||||||||||||||||||||||
Security | Infrastructure | |||||||||||||||||||||||
2012 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Product revenues | $ | 10,316 | $ | 200 | $ | 414 | $ | 10,930 | $ | 73 | $ | 11,003 | ||||||||||||
Services revenues | 5,257 | 440 | 475 | 6,172 | 64 | 6,236 | ||||||||||||||||||
Total consolidated revenues | 15,573 | 640 | 889 | 17,102 | 137 | 17,239 | ||||||||||||||||||
Gross profit | $ | 8,911 | $ | 432 | $ | 604 | $ | 9,947 | $ | 102 | $ | 10,049 | ||||||||||||
Gross profit percentage | 57.2 | % | 67.5 | % | 68 | % | 58.2 | % | 74.4 | % | 58.3 | % | ||||||||||||
Research and development | 1,410 | 116 | 1,526 | |||||||||||||||||||||
Selling, general and administrative | 4,488 | 151 | 4,639 | |||||||||||||||||||||
Restructuring and acquisition-related charges | — | — | — | |||||||||||||||||||||
Total costs and expenses | 5,898 | 267 | 6,165 | |||||||||||||||||||||
Operating income (loss) | $ | 4,049 | $ | (165 | ) | $ | 3,884 | |||||||||||||||||
EMC | VMware | Corp | Consolidated | |||||||||||||||||||||
Information | Virtual | Reconciling | ||||||||||||||||||||||
Infrastructure plus Pivotal | Infrastructure | Items | ||||||||||||||||||||||
within EMC | ||||||||||||||||||||||||
2012 | ||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Product revenues | $ | 11,003 | $ | 2,058 | $ | — | $ | 13,061 | ||||||||||||||||
Services revenues | 6,236 | 2,417 | — | 8,653 | ||||||||||||||||||||
Total consolidated revenues | 17,239 | 4,475 | — | 21,714 | ||||||||||||||||||||
Gross profit | $ | 10,049 | $ | 3,976 | $ | (387 | ) | $ | 13,638 | |||||||||||||||
Gross profit percentage | 58.3 | % | 88.9 | % | — | 62.8 | % | |||||||||||||||||
Research and development | 1,526 | 700 | 334 | 2,560 | ||||||||||||||||||||
Selling, general and administrative | 4,639 | 1,739 | 626 | 7,004 | ||||||||||||||||||||
Restructuring and acquisition-related charges | — | — | 110 | 110 | ||||||||||||||||||||
Total costs and expenses | 6,165 | 2,439 | 1,070 | 9,674 | ||||||||||||||||||||
Operating income | 3,884 | 1,537 | (1,457 | ) | 3,964 | |||||||||||||||||||
Non-operating income (expense) | (177 | ) | 27 | (10 | ) | (160 | ) | |||||||||||||||||
Income tax provision | 968 | 271 | (321 | ) | 918 | |||||||||||||||||||
Net income | 2,739 | 1,293 | (1,146 | ) | 2,886 | |||||||||||||||||||
Net income attributable to the non-controlling interest in VMware, Inc. | — | (255 | ) | 102 | (153 | ) | ||||||||||||||||||
Net income attributable to EMC Corporation | $ | 2,739 | $ | 1,038 | $ | (1,044 | ) | $ | 2,733 | |||||||||||||||
Revenues By Geographic Area | Our revenues are attributed to the geographic areas according to the location of the customers. Revenues by geographic area are included in the following table (table in millions): | |||||||||||||||||||||||
2014 | 2013 | 2012 | ||||||||||||||||||||||
United States | $ | 12,835 | $ | 12,230 | $ | 11,510 | ||||||||||||||||||
Europe, Middle East and Africa | 6,981 | 6,355 | 5,908 | |||||||||||||||||||||
Asia Pacific and Japan | 3,191 | 3,193 | 3,017 | |||||||||||||||||||||
Latin America, Mexico and Canada | 1,433 | 1,444 | 1,279 | |||||||||||||||||||||
Total | $ | 24,440 | $ | 23,222 | $ | 21,714 | ||||||||||||||||||
Selected_Quarterly_Financial_D1
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||
Quarterly Financial Data | Quarterly financial data for 2014 and 2013 is as follows (tables in millions, except per share amounts): | ||||||||||||||||
2014 | Q1 2014 | Q2 2014 | Q3 2014 | Q4 2014 | |||||||||||||
Revenues | $ | 5,479 | $ | 5,880 | $ | 6,032 | $ | 7,048 | |||||||||
Gross profit | 3,347 | 3,654 | 3,743 | 4,505 | |||||||||||||
Net income attributable to EMC Corporation | 392 | 589 | 587 | 1,147 | |||||||||||||
Net income per weighted average share, diluted: common shareholders | $ | 0.19 | $ | 0.28 | $ | 0.28 | $ | 0.56 | |||||||||
2013 | Q1 2013 | Q2 2013 | Q3 2013 | Q4 2013 | |||||||||||||
Revenues | $ | 5,387 | $ | 5,614 | $ | 5,539 | $ | 6,682 | |||||||||
Gross profit | 3,298 | 3,509 | 3,442 | 4,224 | |||||||||||||
Net income attributable to EMC Corporation | 580 | 701 | 586 | 1,022 | |||||||||||||
Net income per weighted average share, diluted: common shareholders | $ | 0.26 | $ | 0.32 | $ | 0.27 | $ | 0.48 | |||||||||
Summary_of_Significant_Account3
Summary of Significant Accounting Policies (Detail) (USD $) | 12 Months Ended | 1 Months Ended | |||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 30, 2012 | Dec. 31, 2010 |
Foreign currency translation | |||||
Net losses from foreign currency transactions | $30 | $2 | $16 | ||
Allowance for doubtful accounts receivable | |||||
Current | 72 | 62 | |||
Non-current (included in other assets, net) | 2 | 3 | |||
Allowance for doubtful accounts receivable, total | 74 | 65 | |||
Software development costs | |||||
Unamortized software development costs | 829 | 762 | |||
Amortization expense for software development costs | 482 | 427 | 398 | ||
Capitalized amounts for software development costs | 549 | 487 | 432 | ||
Advertising | |||||
Advertising costs | 25 | 23 | 30 | ||
Cash Flow Hedging | |||||
Derivatives | |||||
Derivative, Notional Amount | 245 | 384 | 201 | ||
Interest rate swap contract | |||||
Derivatives | |||||
Derivative, Notional Amount | 900 | ||||
Accumulated realized losses in other comprehensive income related to previously-anticipated interest payments reclassified from other comprehensive income and recognized in the consolidated income statements | 40 | ||||
Accumulated Other Comprehensive Income (Loss), Cumulative Changes in Net Gain (Loss) from Cash Flow Hedges, Effect Net of Tax | -176 | ||||
Advertising | |||||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | ($11) | ||||
Maximum | |||||
Significant Accounting Policies [Line Items] | |||||
Cash and cash equivalent, General Contract Maturity | 90 days | ||||
Maximum | Foreign Exchange Contract | |||||
Derivatives | |||||
Contract maturity | 1 year | ||||
Maximum | Cash Flow Hedging | |||||
Derivatives | |||||
Contract maturity | 6 months | ||||
Furniture and fixtures | Minimum | |||||
Property, plant and equipment | |||||
Useful life (in years) | 5 years | ||||
Furniture and fixtures | Maximum | |||||
Property, plant and equipment | |||||
Useful life (in years) | 10 years | ||||
Equipment and software | Minimum | |||||
Property, plant and equipment | |||||
Useful life (in years) | 2 years | ||||
Equipment and software | Maximum | |||||
Property, plant and equipment | |||||
Useful life (in years) | 10 years | ||||
Improvements | Minimum | |||||
Property, plant and equipment | |||||
Useful life (in years) | 5 years | ||||
Improvements | Maximum | |||||
Property, plant and equipment | |||||
Useful life (in years) | 31 years | ||||
Buildings | Minimum | |||||
Property, plant and equipment | |||||
Useful life (in years) | 15 years | ||||
Buildings | Maximum | |||||
Property, plant and equipment | |||||
Useful life (in years) | 51 years | ||||
Pivotal | |||||
Principles of consolidation | |||||
Noncontrolling Interest, Ownership Percentage by Parent | 84.00% | 84.00% | |||
VMware | |||||
Principles of consolidation | |||||
Noncontrolling Interest, Ownership Percentage by Parent | 80.00% | 80.00% |
Noncontrolling_Interests_Addit
Non-controlling Interests - Additional Information (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Noncontrolling Interest [Line Items] | ||
Non-controlling interests | $1,629 | $1,485 |
VMware | ||
Noncontrolling Interest [Line Items] | ||
Noncontrolling Interest, Ownership Percentage by Parent | 80.00% | 80.00% |
Voting power of outstanding common stock | 97.00% | |
Non-controlling interests | 1,524 | 1,380 |
Pivotal | ||
Noncontrolling Interest [Line Items] | ||
Noncontrolling Interest, Ownership Percentage by Parent | 84.00% | 84.00% |
Non-controlling interests | $105 | $105 |
Noncontrolling_Interests_Effec
Non-controlling Interests - Effect of Changes in Ownership Interest in VMware on Equity (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Noncontrolling Interest [Line Items] | |||||||||||
Net income attributable to EMC Corporation | $1,147 | $587 | $589 | $392 | $1,022 | $586 | $701 | $580 | $2,714 | $2,889 | $2,733 |
Net transfers (to) from non-controlling interest | -690 | -333 | -350 | ||||||||
VMware | |||||||||||
Noncontrolling Interest [Line Items] | |||||||||||
Net income attributable to EMC Corporation | 2,714 | 2,889 | |||||||||
Increase in EMC Corporation’s additional paid-in-capital for VMware’s equity issuances | 87 | 92 | |||||||||
Decrease in EMC Corporation’s additional paid-in-capital for VMware’s other equity activity | -741 | -565 | |||||||||
Net transfers (to) from non-controlling interest | -654 | -473 | |||||||||
Change from net income attributable to EMC Corporation and transfers from the non-controlling interest in VMware, Inc. | $2,060 | $2,416 |
Acquisitions_Allocation_of_Pur
Acquisitions - Allocation of Purchase Price (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2012 | Dec. 31, 2014 | Dec. 31, 2013 |
Intangible assets: | |||
Goodwill | $13,840 | $16,134 | $14,424 |
VMware | AirWatch | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets | 61 | ||
Intangible assets: | |||
Intangible assets | 250 | ||
Other current liabilities, net of current assets | -72 | ||
Total purchase price | 1,092 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Business Acquisition, Goodwill, Expected Tax Deductible Amount | 868 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets | 30 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | 1,209 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Deferred Revenue | -45 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | -117 | ||
VMware | Nicira | |||
Intangible assets: | |||
Intangible assets | 335 | ||
Goodwill | 893 | ||
Deferred tax liabilities, net | -77 | ||
Income tax payable | -50 | ||
Other current liabilities, net of current assets | -1 | ||
Total purchase price | 1,100 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Risk-free interest rate | 0.30% | ||
Purchased / Developed technology | VMware | AirWatch | |||
Intangible assets: | |||
Intangible assets | 118 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 6 years | ||
Purchased / Developed technology | VMware | Nicira | |||
Intangible assets: | |||
Intangible assets | 266 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 7 years | ||
Tradename and trademark | VMware | AirWatch | |||
Intangible assets: | |||
Intangible assets | 40 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 8 years | ||
Tradename and trademark | VMware | Nicira | |||
Intangible assets: | |||
Intangible assets | 20 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 10 years | ||
In-process research and development | VMware | Nicira | |||
Intangible assets: | |||
Intangible assets | 49 | ||
Customer relationships and customer lists | VMware | AirWatch | |||
Intangible assets: | |||
Intangible assets | 78 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 8 years | ||
Other | VMware | AirWatch | |||
Intangible assets: | |||
Intangible assets | $14 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 3 years |
Acquisitions_WeightedAverage_A
Acquisitions - Weighted-Average Assumptions Used to Calculate Fair Value of Stock Options Issued (Details) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2012 | Dec. 31, 2013 | |
All 2014 Acquisitions, excluding Airwatch | |||
Business Acquisition [Line Items] | |||
Expected term (in years) | 2 years 6 months 20 days | ||
Expected volatility | 27.30% | ||
Risk-free interest rate | 0.70% | ||
Dividend yield | 1.70% | ||
2012 Acquisitions, excluding Nicira | |||
Business Acquisition [Line Items] | |||
Expected term (in years) | 1 year 9 months 44 days | ||
Expected volatility | 31.60% | ||
Risk-free interest rate | 0.30% | ||
All 2013 Acquisitions | |||
Business Acquisition [Line Items] | |||
Expected term (in years) | 1 year 8 months 44 days | ||
Expected volatility | 26.40% | ||
Risk-free interest rate | 0.30% | ||
Dividend yield | 1.50% | ||
VMware | Nicira | |||
Business Acquisition [Line Items] | |||
Fair Value Assumptions, Expected Term | 2 years 7 months 30 days | ||
Expected volatility | 35.70% | ||
Risk-free interest rate | 0.30% |
Acquisitions_Aggregate_Allocat
Acquisitions - Aggregate Allocation of the Purchase Price of Acquisitions to Intangible Assets (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2012 | Dec. 31, 2013 |
All 2014 Acquisitions, excluding Airwatch | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $484 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 6 years | ||
2012 Acquisitions, excluding Nicira | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 311 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 5 years | ||
All 2013 Acquisitions | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 182 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 4 years | ||
Purchased / Developed technology | All 2014 Acquisitions, excluding Airwatch | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 460 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 6 years | ||
Purchased / Developed technology | 2012 Acquisitions, excluding Nicira | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 255 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 5 years | ||
Purchased / Developed technology | All 2013 Acquisitions | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 138 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 5 years | ||
Customer relationships | All 2014 Acquisitions, excluding Airwatch | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 10 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 5 years | ||
Customer relationships | 2012 Acquisitions, excluding Nicira | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 54 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 6 years | ||
Customer relationships | All 2013 Acquisitions | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 34 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 4 years | ||
Tradename and trademark | All 2014 Acquisitions, excluding Airwatch | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 14 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 4 years | ||
Tradename and trademark | 2012 Acquisitions, excluding Nicira | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 2 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 3 years | ||
In-process research and development | All 2013 Acquisitions | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 10 | ||
VMware | Nicira | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 335 | ||
VMware | AirWatch | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 250 | ||
VMware | Purchased / Developed technology | Nicira | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 266 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 7 years | ||
VMware | Purchased / Developed technology | AirWatch | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 118 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 6 years | ||
VMware | Customer relationships and customer lists | AirWatch | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 78 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 8 years | ||
VMware | Tradename and trademark | Nicira | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 20 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 10 years | ||
VMware | Tradename and trademark | AirWatch | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 40 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 8 years | ||
VMware | In-process research and development | Nicira | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 49 | ||
VMware | Other | AirWatch | |||
Business Acquisition [Line Items] | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $14 | ||
Finite-Lived Intangible Assets, Net [Abstract] | |||
Weighted-average useful life | 3 years |
Acquisitions_Additional_Inform
Acquisitions - Additional Information (Details) (USD $) | 12 Months Ended | 0 Months Ended | |||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Feb. 24, 2014 | Aug. 24, 2012 |
Business Acquisition [Line Items] | |||||
Payments to Acquire Businesses, Net of Cash Acquired | $1,973 | $770 | $2,136 | ||
Business acquisition, adjustment to fair value of previously held interests, recognized in other income | 101 | ||||
Consideration of acquisitions allocated to goodwill | 16,134 | 14,424 | 13,840 | ||
All 2014 Acquisitions, excluding Airwatch | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, aggregate consideration for businesses | 1,515 | ||||
Cash consideration for acquisition of business, net of cash acquired | 1,404 | ||||
Business acquisition, fair value of stock options issued | 10 | ||||
Stock options issued in acquisition, risk-free interest rate | 0.70% | ||||
Stock options issued in acquisition, annualized volatility | 27.30% | ||||
Dividend yield | 1.70% | ||||
Number of Businesses Acquired | 10 | ||||
Consideration of acquisitions allocated to goodwill | 847 | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 484 | ||||
Consideration of acquisitions allocated to net assets (liabilities) | 184 | ||||
Weighted-average useful life | 6 years | ||||
Business Acquisition, Gain From Change In Fair Value Subsequent To Acquisition | -101 | ||||
All 2013 Acquisitions | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, aggregate consideration for businesses | 771 | ||||
Cash consideration for acquisition of business, net of cash acquired | 770 | ||||
Business acquisition, fair value of stock options issued | 1 | ||||
Stock options issued in acquisition, risk-free interest rate | 0.30% | ||||
Stock options issued in acquisition, annualized volatility | 26.40% | ||||
Dividend yield | 1.50% | ||||
Number of Businesses Acquired | 8 | ||||
Consideration of acquisitions allocated to goodwill | 596 | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 182 | ||||
Consideration of acquisitions allocated to net assets (liabilities) | -8 | ||||
Weighted-average useful life | 4 years | ||||
XtremIO | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, adjustment to fair value of previously held interests, recognized in other income | 32 | ||||
2012 Acquisitions, excluding Nicira | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, aggregate consideration for businesses | 1,060 | ||||
Cash consideration for acquisition of business, net of cash acquired | 1,053 | ||||
Business acquisition, fair value of stock options issued | 7 | ||||
Stock options issued in acquisition, risk-free interest rate | 0.30% | ||||
Stock options issued in acquisition, annualized volatility | 31.60% | ||||
Number of Businesses Acquired | 16 | ||||
Consideration of acquisitions allocated to goodwill | 819 | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 311 | ||||
Consideration of acquisitions allocated to net assets (liabilities) | -70 | ||||
Weighted-average useful life | 5 years | ||||
EMC | |||||
Business Acquisition [Line Items] | |||||
Number of Businesses Acquired | 7 | ||||
EMC | All 2013 Acquisitions | |||||
Business Acquisition [Line Items] | |||||
Number of Businesses Acquired | 5 | ||||
EMC | 2012 Acquisitions, excluding Nicira | |||||
Business Acquisition [Line Items] | |||||
Number of Businesses Acquired | 11 | ||||
VMware | AirWatch | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, aggregate consideration for businesses | 1,128 | ||||
Payments to Acquire Businesses, Net of Cash Acquired | 1,104 | ||||
Business acquisition, fair value of stock options issued | 24 | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 250 | ||||
Business Combination, Contingent Compensation | 300 | ||||
Business Combination, Retention Bonus | 141 | ||||
VMware | All 2013 Acquisitions | |||||
Business Acquisition [Line Items] | |||||
Number of Businesses Acquired | 2 | ||||
VMware | Nicira | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, aggregate consideration for businesses | 1,100 | ||||
Cash consideration for acquisition of business, net of cash acquired | 1,083 | ||||
Business acquisition, fair value of stock options issued | 17 | ||||
Number of stock options issued in acquisition | 1 | ||||
Number of shares of stock issued in acquisition | 1 | ||||
Acquisition-date closing share price | $92.21 | ||||
Fair Value Assumptions, Expected Term | 2 years 7 months 30 days | ||||
Stock options issued in acquisition, risk-free interest rate | 0.30% | ||||
Stock options issued in acquisition, annualized volatility | 35.70% | ||||
Consideration of acquisitions allocated to goodwill | 893 | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 335 | ||||
VMware | 2012 Acquisitions, excluding Nicira | |||||
Business Acquisition [Line Items] | |||||
Number of Businesses Acquired | 5 | ||||
Developed Technology Rights | All 2014 Acquisitions, excluding Airwatch | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 460 | ||||
Weighted-average useful life | 6 years | ||||
Developed Technology Rights | All 2013 Acquisitions | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 138 | ||||
Weighted-average useful life | 5 years | ||||
Developed Technology Rights | 2012 Acquisitions, excluding Nicira | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 255 | ||||
Weighted-average useful life | 5 years | ||||
Developed Technology Rights | VMware | AirWatch | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 118 | ||||
Weighted-average useful life | 6 years | ||||
Developed Technology Rights | VMware | Nicira | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 266 | ||||
Weighted-average useful life | 7 years | ||||
In-process research and development | All 2013 Acquisitions | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 10 | ||||
In-process research and development | VMware | Nicira | |||||
Business Acquisition [Line Items] | |||||
Finite-Lived Intangible Asset, Useful Life | 8 years | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 49 | ||||
Customer relationships | All 2014 Acquisitions, excluding Airwatch | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 10 | ||||
Weighted-average useful life | 5 years | ||||
Customer relationships | All 2013 Acquisitions | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | 34 | ||||
Weighted-average useful life | 4 years | ||||
Customer relationships | 2012 Acquisitions, excluding Nicira | |||||
Business Acquisition [Line Items] | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $54 | ||||
Weighted-average useful life | 6 years |
Intangibles_and_Goodwill_Intan
Intangibles and Goodwill - Intangible Assets, Excluding Goodwill (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount | $5,163 | $4,412 |
Accumulated Amortization | -3,038 | -2,632 |
Net Book Value | 2,125 | 1,780 |
Purchased / Developed technology | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount | 2,935 | 2,356 |
Accumulated Amortization | -1,668 | -1,429 |
Net Book Value | 1,267 | 927 |
Patents | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount | 225 | 225 |
Accumulated Amortization | -117 | -102 |
Net Book Value | 108 | 123 |
Software licenses | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount | 108 | 101 |
Accumulated Amortization | -93 | -90 |
Net Book Value | 15 | 11 |
Trademarks and tradenames | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount | 226 | 171 |
Accumulated Amortization | -136 | -118 |
Net Book Value | 90 | 53 |
Customer relationships and customer lists | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,473 | 1,386 |
Accumulated Amortization | -974 | -855 |
Net Book Value | 499 | 531 |
Leasehold interest | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount | 152 | 145 |
Accumulated Amortization | -16 | -11 |
Net Book Value | 136 | 134 |
Other | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount | 44 | 28 |
Accumulated Amortization | -34 | -27 |
Net Book Value | $10 | $1 |
Intangibles_and_Goodwill_Amort
Intangibles and Goodwill - Amortization Expense on Intangible Assets for the Next Five Years (Details) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2015 | $390 |
2016 | 336 |
2017 | 309 |
2018 | 290 |
2019 | 241 |
Total | $1,566 |
Intangibles_and_Goodwill_Chang
Intangibles and Goodwill - Changes in Carrying Amount of Goodwill (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Goodwill [Roll Forward] | ||
Balance, beginning of the year | $14,424 | $13,840 |
Goodwill resulting from acquisitions | 1,715 | 597 |
Finalization of purchase price allocations and other, net | -5 | -13 |
Goodwill transferred in formation of Pivotal | 0 | 0 |
Balance, end of the year | 16,134 | 14,424 |
Information Storage | ||
Goodwill [Roll Forward] | ||
Balance, beginning of the year | 7,486 | 7,442 |
Goodwill resulting from acquisitions | 774 | 145 |
Finalization of purchase price allocations and other, net | 0 | 11 |
Goodwill transferred in formation of Pivotal | 6 | 112 |
Balance, end of the year | 8,266 | 7,486 |
Enterprise Content Division | ||
Goodwill [Roll Forward] | ||
Balance, beginning of the year | 1,487 | 1,484 |
Goodwill resulting from acquisitions | 0 | 1 |
Finalization of purchase price allocations and other, net | -1 | 2 |
Goodwill transferred in formation of Pivotal | 0 | 0 |
Balance, end of the year | 1,486 | 1,487 |
RSA Information Security | ||
Goodwill [Roll Forward] | ||
Balance, beginning of the year | 2,203 | 2,022 |
Goodwill resulting from acquisitions | 0 | 181 |
Finalization of purchase price allocations and other, net | 0 | 0 |
Goodwill transferred in formation of Pivotal | 0 | 0 |
Balance, end of the year | 2,203 | 2,203 |
Pivotal | ||
Goodwill [Roll Forward] | ||
Balance, beginning of the year | 177 | 0 |
Goodwill resulting from acquisitions | 0 | 37 |
Finalization of purchase price allocations and other, net | 0 | 0 |
Goodwill transferred in formation of Pivotal | -6 | -140 |
Balance, end of the year | 171 | 177 |
VMware Virtual Infrastructure Within EMC Corp | ||
Goodwill [Roll Forward] | ||
Balance, beginning of the year | 3,071 | 2,892 |
Goodwill resulting from acquisitions | 941 | 233 |
Finalization of purchase price allocations and other, net | -4 | -26 |
Goodwill transferred in formation of Pivotal | 0 | 28 |
Balance, end of the year | $4,008 | $3,071 |
Intangibles_and_Goodwill_Addit
Intangibles and Goodwill - Additional Information (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Goodwill [Line Items] | |||
Amortization expense on intangible assets | $402 | $389 | $365 |
Debt_Key_Components_of_Longter
Debt Key Components of Long-term Debt (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Debt Instrument [Line Items] | ||
Fair Value Inputs, Discount Rate | 1.00% | |
Long-term debt | $5,495 | $5,494 |
Long-term Debt | ||
Debt Instrument [Line Items] | ||
Debt Instrument, Unamortized Discount | 5 | |
Debt Instrument, Interest Rate During Period | 2.54% | |
Long-term Notes $2.5B | ||
Debt Instrument [Line Items] | ||
Fair Value Inputs, Discount Rate | 99.94% | |
Long-term debt | 2,499 | |
Long-term Notes $2.0B | ||
Debt Instrument [Line Items] | ||
Fair Value Inputs, Discount Rate | 99.76% | |
Long-term debt | 1,996 | |
Long-term Notes $1.0B | ||
Debt Instrument [Line Items] | ||
Fair Value Inputs, Discount Rate | 99.93% | |
Long-term debt | $1,000 |
Debt_Key_Components_of_Convert
Debt - Key Components of Convertible Debt (Detail) (Convertible Senior Notes 2011 and 2013, USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Convertible Senior Notes 2011 and 2013 | ||
Debt Instrument [Line Items] | ||
Contractual interest expense on the coupon | $27 | $30 |
Amortization of the discount component recognized as interest expense | 58 | 61 |
Total interest expense on the convertible debt | $85 | $91 |
Debt_Additional_Information_De
Debt - Additional Information (Detail) (USD $) | 12 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | 0 Months Ended | 1 Months Ended | ||||||
Share data in Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 30, 2012 | Jan. 07, 2014 | Nov. 30, 2006 | Jan. 09, 2012 | Mar. 17, 2014 | Dec. 31, 2010 | Jan. 07, 2013 | Nov. 13, 2006 | Jun. 30, 2013 |
Aggregate amount paid for purchased options | $0 | $0 | $70,000,000 | |||||||||
Interest rate swap contract | ||||||||||||
Aggregate notional amount of interest rate swap contracts designated as cash flow hedges | 900,000,000 | |||||||||||
Accumulated realized losses in other comprehensive income related to previously-anticipated interest payments reclassified from other comprehensive income and recognized in the consolidated income statements | 40,000,000 | |||||||||||
Unrealized gain on derivatives | 176,000,000 | |||||||||||
Derivative Instruments, Gain (Loss) Reclassified from Accumulated OCI into Income, Effective Portion, Net | -11,000,000 | |||||||||||
Convertible Senior Notes 2013 | ||||||||||||
Senior Notes | 1,725,000,000 | |||||||||||
Cash payment to noteholders for outstanding principal of converted Notes | 1,700,000,000 | |||||||||||
Shares issued to noteholders for the excess of the conversion value over the principal amount of converted Notes | 35 | |||||||||||
Value of the conversion value over the principal amount of converted Notes | 858,000,000 | |||||||||||
Observation period | 20 days | |||||||||||
Conversion rate for the 2013 Notes will be 62.1978 shares of our common stock per one thousand dollars of principal amount of 2013 Notes | 62.6978 | |||||||||||
Conversion premium | 26.50% | |||||||||||
Conversion price | $15.95 | |||||||||||
Semi-annual interest rate | 1.75% | |||||||||||
Debt Instrument, frequency of periodic payment | semi-annually | |||||||||||
Convertible Senior Notes 2011 | ||||||||||||
Cash payment to noteholders for outstanding principal of converted Notes | 1,700,000,000 | |||||||||||
Shares issued to noteholders for the excess of the conversion value over the principal amount of converted Notes | 30 | |||||||||||
Value of the conversion value over the principal amount of converted Notes | 661,000,000 | |||||||||||
Convertible Senior Notes 2011 and 2013 | ||||||||||||
Proceeds from issuance of senior unsecured obligations | 3,500,000,000 | |||||||||||
Effective interest rate | 5.60% | 5.60% | ||||||||||
Purchased Options | ||||||||||||
Incremental common shares attributable to call options and warrants | 215 | |||||||||||
Aggregate amount paid for purchased options | 669,000,000 | |||||||||||
Purchased options shares received | 35 | |||||||||||
Purchased options remaining | 108 | |||||||||||
Sold Warrants | ||||||||||||
Incremental common shares attributable to call options and warrants | 215 | |||||||||||
Common stock at an exercise price | 19.55 | $19.31 | ||||||||||
Proceeds from issuance of warrants | 391,000,000 | |||||||||||
Conversion premium based on the closing price | 53.20% | |||||||||||
Closing price per share | $12.61 | |||||||||||
Exercised Warrants | ||||||||||||
Shares issues for exercised warrants | 29 | |||||||||||
Warrant | ||||||||||||
Warrants and Rights Outstanding | 109,000,000 | |||||||||||
Long-term Debt | ||||||||||||
Debt Instrument, Fair Value Disclosure | $5,500,000,000 |
Fair_Value_of_Financial_Assets2
Fair Value of Financial Assets and Liabilities - Composition of Investments (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | $0 | |
U.S. government and agency obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 1,951 | 3,726 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 2 | 4 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | -2 | -3 |
Available-for-sale securities | 1,951 | 3,727 |
U.S. corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 1,998 | 2,260 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 1 | 8 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | -4 | -2 |
Available-for-sale securities | 1,995 | 2,266 |
High yield corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 570 | 515 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 9 | 19 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | -16 | -3 |
Available-for-sale securities | 563 | 531 |
Asset-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 53 | |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 0 | |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | 0 | |
Available-for-sale securities | 53 | |
Municipal obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 948 | 860 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 2 | 3 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | 0 | 0 |
Available-for-sale securities | 950 | 863 |
Auction rate securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 29 | 63 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 0 | |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | -2 | -3 |
Available-for-sale securities | 27 | 60 |
Foreign debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 2,566 | 2,152 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 2 | 6 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | -4 | -3 |
Available-for-sale securities | 2,564 | 2,155 |
Total fixed income securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 8,115 | 9,576 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 16 | 40 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | -28 | -14 |
Available-for-sale securities | 8,103 | 9,602 |
Publicly traded equity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 117 | 72 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 103 | 24 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | -11 | -1 |
Available-for-sale securities | 209 | 95 |
Total | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 8,232 | 9,648 |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 119 | 64 |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | -39 | -15 |
Available-for-sale securities | $8,312 | $9,697 |
Fair_Value_of_Financial_Assets3
Fair Value of Financial Assets and Liabilities - Fair Value Hierarchy For Financial Assets And Liabilities Measured At Fair Value (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | $14,655,000,000 | $17,588,000,000 |
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures | -37,000,000 | -35,000,000 |
Cash | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 2,022,000,000 | 1,725,000,000 |
Cash equivalents | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 4,321,000,000 | 6,166,000,000 |
U.S. government and agency obligations | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 1,951,000,000 | 3,727,000,000 |
U.S. corporate debt securities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 1,995,000,000 | 2,266,000,000 |
High yield corporate debt securities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 563,000,000 | 531,000,000 |
Asset-backed securities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 53,000,000 | |
Municipal obligations | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 950,000,000 | 863,000,000 |
Commodity derivative assets | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Commodity derivative assets | -12,000,000 | |
Derivative Asset | 4,000,000 | |
Auction rate securities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 27,000,000 | 60,000,000 |
Foreign debt securities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 2,564,000,000 | 2,155,000,000 |
Publicly traded equity securities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 209,000,000 | 95,000,000 |
Strategic investments carried at cost | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 333,000,000 | 379,000,000 |
Long-term Debt | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Debt Instrument, Fair Value Disclosure | -5,544,000,000 | -5,419,000,000 |
Foreign exchange derivative assets/liabilities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Derivative Asset, Fair Value, Gross Asset | 44,000,000 | 31,000,000 |
Commodity derivative assets | -71,000,000 | -20,000,000 |
Level 1 | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 7,082,000,000 | 9,291,000,000 |
Level 1 | Cash | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 2,022,000,000 | 1,725,000,000 |
Level 1 | Cash equivalents | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 3,710,000,000 | 5,674,000,000 |
Level 1 | U.S. government and agency obligations | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 1,141,000,000 | 1,797,000,000 |
Level 1 | Publicly traded equity securities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 209,000,000 | 95,000,000 |
Level 1 | Long-term Debt | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Debt Instrument, Fair Value Disclosure | 0 | 0 |
Level 2 | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 7,546,000,000 | 8,237,000,000 |
Level 2 | Cash equivalents | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 611,000,000 | 492,000,000 |
Level 2 | U.S. government and agency obligations | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 810,000,000 | 1,930,000,000 |
Level 2 | U.S. corporate debt securities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 1,995,000,000 | 2,266,000,000 |
Level 2 | High yield corporate debt securities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 563,000,000 | 531,000,000 |
Level 2 | Asset-backed securities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 53,000,000 | |
Level 2 | Municipal obligations | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 950,000,000 | 863,000,000 |
Level 2 | Commodity derivative assets | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Derivative Asset | 12,000,000 | 4,000,000 |
Level 2 | Foreign debt securities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 2,564,000,000 | 2,155,000,000 |
Level 2 | Long-term Debt | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Debt Instrument, Fair Value Disclosure | -5,544,000,000 | -5,419,000,000 |
Level 2 | Foreign exchange derivative assets/liabilities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Derivative Asset, Fair Value, Gross Asset | 44,000,000 | 31,000,000 |
Commodity derivative assets | -71,000,000 | -20,000,000 |
Level 3 | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 27,000,000 | 60,000,000 |
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures | -37,000,000 | -35,000,000 |
Level 3 | Auction rate securities | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 27,000,000 | 60,000,000 |
Level 3 | Strategic investments carried at cost | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Total cash and investments | 333,000,000 | 379,000,000 |
Level 3 | Long-term Debt | ||
Fair Value of Financial Assets and Liabilities [Line Items] | ||
Debt Instrument, Fair Value Disclosure | $0 | $0 |
Fair_Value_of_Financial_Assets4
Fair Value of Financial Assets and Liabilities - Changes In Fair Value of Level 3 Financial Assets (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Millions, unless otherwise specified | Jun. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Other-than-temporary impairment loss | ($24) | ($33) | $0 | $0 |
Auction rate securities | ||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Sales | ($34) | ($8) |
Fair_Value_of_Financial_Assets5
Fair Value of Financial Assets and Liabilities - Unrealized Losses on Investments by Investment Category and Length of Time in Continuous Unrealized Loss Position (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | $4,375 | $2,559 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 35 | 11 |
12 Months or Greater, Fair Value | 30 | 128 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 4 | 4 |
Total, Fair Value | 4,405 | 2,687 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss | 39 | 15 |
U.S. government and agency obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | 1,168 | 1,161 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 2 | 3 |
12 Months or Greater, Fair Value | 0 | 20 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 0 | 0 |
Total, Fair Value | 1,168 | 1,181 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss | 2 | 3 |
U.S. corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | 1,383 | 532 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 4 | 2 |
12 Months or Greater, Fair Value | 0 | 17 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 0 | 0 |
Total, Fair Value | 1,383 | 549 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss | 4 | 2 |
High yield corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | 244 | 120 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 16 | 3 |
12 Months or Greater, Fair Value | 0 | 0 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 0 | 0 |
Total, Fair Value | 244 | 120 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss | 16 | 3 |
Municipal obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | 51 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 0 | |
12 Months or Greater, Fair Value | 0 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 0 | |
Total, Fair Value | 51 | |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss | 0 | |
Auction rate securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | 0 | 0 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 0 | 0 |
12 Months or Greater, Fair Value | 27 | 60 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 2 | 3 |
Total, Fair Value | 27 | 60 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss | 2 | 3 |
Foreign debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | 1,563 | 695 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 4 | 3 |
12 Months or Greater, Fair Value | 0 | 6 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 0 | 0 |
Total, Fair Value | 1,563 | 701 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss | 4 | 3 |
Publicly traded equity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less Than 12 Months, Fair Value | 17 | 0 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Accumulated Loss | 9 | 0 |
12 Months or Greater, Fair Value | 3 | 25 |
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss | 2 | 1 |
Total, Fair Value | 20 | 25 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Accumulated Loss | $11 | $1 |
Fair_Value_of_Financial_Assets6
Fair Value of Financial Assets and Liabilities - Contractual Maturities of Investments (Detail) (Total fixed income securities, USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Total fixed income securities | ||
Amortized Cost Basis | ||
Due within one year | $1,946 | |
Due after 1 year through 5 years | 5,332 | |
Due after 5 years through 10 years | 548 | |
Due after 10 years | 289 | |
Amortized Cost Basis | 8,115 | 9,576 |
Aggregate Fair Value | ||
Due within one year | 1,946 | |
Due after 1 year through 5 years | 5,330 | |
Due after 5 years through 10 years | 540 | |
Due after 10 years | 287 | |
Aggregate Fair Value | $8,103 | $9,602 |
Fair_Value_of_Financial_Assets7
Fair Value of Financial Assets and Liabilities - Additional Information (Detail) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Security | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Number of Auction Rate Securities With Underlying Loans Which Have No Guarantees | 1 | |
Gain on sale of investment | $101 | |
Auction rate securities that have partial guarantees by the U.S. government, market value | 7 | |
Percentage of loans which collateralize auction rate securities guaranteed by FFELP | 95.00% | |
Discount rate used to estimate fair value of investments | 1.00% | |
Investment holding period | 5 years | |
The rate used for the discount margin to determine the estimated fair value of investment in auction rate securities | 1.00% | 1.00% |
Short term investment, not classified in investments due within one year | 1,978 | 2,773 |
Minimum | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Coupon rate used to estimate fair value of invesments - low end of range | 0.00% | |
Maximum | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Coupon rate used to estimate fair value of invesments - high end of range | 3.00% | |
Municipal obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities | 950 | 863 |
Publicly traded equity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities | 209 | 95 |
High yield corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities | 563 | 531 |
Asset-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities | 53 | |
Securities (Assets) | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities | 8,312 | 9,697 |
Foreign debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities | 2,564 | 2,155 |
Average credit rating | A+ | |
Foreign Sovereign Debt Securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Average credit rating | AA+ | |
Percentage of securities deemed soverign debt | 5.00% | |
Auction rate securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale securities | 27 | 60 |
Average credit rating | AA | |
Variable Rate Demand Note | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Short term investment, not classified in investments due within one year | 32 | |
Contractual maturity date | 31-Dec-15 | |
XtremIO | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Gain on sale of investment | $32 | |
LenovoEMC | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Joint Venture, Ownership Interest Percentage | 49.00% | |
Discount rate used to estimate fair value of investments | 6.00% |
Inventories_Components_of_Inve
Inventories - Components of Inventories (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ||
Work-in-process | $627 | $696 |
Finished goods | 649 | 638 |
Inventory, Net, Total | $1,276 | $1,334 |
Accounts_and_Notes_Receivable_2
Accounts and Notes Receivable and Allowance for Credit Losses - Contractual Amounts Due under Leases (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Receivables [Abstract] | ||
Due within one year | $97 | |
Due within two years | 73 | |
Due within three years | 62 | |
Thereafter | 1 | |
Total | 233 | 252 |
Less amounts representing interest | -5 | |
Present value | 228 | |
Current portion (included in accounts and notes receivable) | 94 | |
Long-term portion (included in other assets, net) | $134 |
Accounts_and_Notes_Receivable_3
Accounts and Notes Receivable and Allowance for Credit Losses - Allowance for Credit Losses (Detail) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Financing Receivable, Allowance for Credit Losses [Roll Forward] | ||
Balance, beginning of the period | $9 | $17 |
Recoveries | -7 | -12 |
Provisions | 4 | 4 |
Balance, end of the period | $6 | $9 |
Accounts_and_Notes_Receivable_4
Accounts and Notes Receivable and Allowance for Credit Losses - Additional Information (Detail) (USD $) | 2 Months Ended | ||
In Millions, unless otherwise specified | Feb. 17, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Gross lease receivables | $233 | $252 | |
Subsequent Event | |||
Financing Receivable, Recorded Investment, Past Due [Line Items] | |||
Sales of leases to third parties without recourse | $54 |
Property_Plant_and_Equipment_C
Property, Plant and Equipment - Components of Property, Plant and Equipment (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | $9,543 | $8,638 | |
Accumulated depreciation | -5,777 | -5,160 | |
Property, plant and equipment, net | 3,766 | 3,478 | |
Depreciation | 998 | 867 | 780 |
Furniture and fixtures | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 255 | 229 | |
Equipment and software | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 6,684 | 5,973 | |
Buildings and improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 2,308 | 2,089 | |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 162 | 132 | |
Building construction in progress | |||
Property, Plant and Equipment [Line Items] | |||
Property, plant and equipment, gross | 134 | 215 | |
Assets held for future use | |||
Property, Plant and Equipment [Line Items] | |||
Construction in progress on facilities held for future use | $76 |
Joint_Ventures_Detail
Joint Ventures (Detail) (USD $) | 12 Months Ended | 84 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 |
Schedule of Equity Method Investments [Line Items] | ||||
Capital contribution | $360 | $411 | $228 | |
VCE Company LLC | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Capital contribution | 1,555 | |||
Accumulated stock-based compensation contributed to joint venture | 17 | |||
Consolidated share of losses | 64.00% | 63.00% | 63.00% | |
Loss From VCE | 357 | 298 | 245 | 1,153 |
Revenue recognized from sales to VCE | $803 | $439 | $286 |
Accrued_Expenses_Components_of
Accrued Expenses - Components of Accrued Expenses (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Millions, unless otherwise specified | ||||
Payables and Accruals [Abstract] | ||||
Salaries and benefits | $1,260 | $1,078 | ||
Product warranties | 210 | 289 | 278 | 255 |
Dividends Payable | 237 | 205 | ||
Partner rebates | 235 | 214 | ||
Restructuring, current (See Note Q) | 115 | 84 | ||
Derivatives | 75 | 23 | ||
Other | 1,009 | 890 | ||
Accrued expenses | $3,141 | $2,783 |
Accrued_Expenses_Activity_in_W
Accrued Expenses - Activity in Warranty Accrual for Product Warranty (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Movement in Standard Product Warranty Accrual [Roll Forward] | |||
Balance, beginning of the period | $289 | $278 | $255 |
Provision | 150 | 198 | 182 |
Amounts charged to the accrual | -229 | -187 | -159 |
Balance, end of the period | $210 | $289 | $278 |
Income_Taxes_Provision_for_Inc
Income Taxes - Provision for Income Taxes (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Federal: | |||
Current | $955 | $698 | $792 |
Deferred | -308 | -163 | -80 |
Federal, total | 647 | 535 | 712 |
State: | |||
Current | 81 | 84 | 74 |
Deferred | -70 | -23 | -12 |
State, total | 11 | 61 | 62 |
Foreign: | |||
Current | 228 | 192 | 169 |
Deferred | -18 | -16 | -25 |
Foreign, total | 210 | 176 | 144 |
Total provision for income taxes | $868 | $772 | $918 |
Income_Taxes_Reconciliation_of
Income Taxes - Reconciliation of Income Tax Provision to Statutory Federal Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Income Tax Disclosure [Abstract] | |||
Statutory federal tax rate | 35.00% | 35.00% | 35.00% |
State taxes, net of federal taxes | 2.60% | 0.70% | 0.50% |
Resolution of uncertain tax positions | -0.90% | -0.90% | -0.50% |
Tax rate differential for international jurisdictions and other international related tax items | -11.30% | -15.00% | -13.60% |
U.S. tax credits | -1.90% | -3.80% | -0.20% |
Effective Income Tax Rate Reconciliation, Change in Deferred Tax Assets Valuation Allowance, Percent | -2.30% | 0.70% | 0.80% |
Effective Income Tax Rate Reconciliation, Deduction, Qualified Production Activity, Percent | -1.80% | -1.50% | -1.30% |
International reorganization of acquired companies | 0.00% | 0.60% | 0.30% |
Permanent items | 3.90% | 3.80% | 2.80% |
Other | -0.20% | 0.40% | 0.30% |
Effective income tax rate | 23.10% | 20.00% | 24.10% |
Income_Taxes_Components_of_Cur
Income Taxes - Components of Current and Noncurrent Deferred Tax Assets and Liabilities (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Current: | ||
Gross deferred tax assets | $2,006 | $1,819 |
Gross deferred tax liabilities | -928 | -984 |
Valuation allowance | -126 | -211 |
Total deferred tax assets | 1,880 | 1,608 |
Total deferred tax liabilities | -928 | -984 |
Current assets | ||
Current: | ||
Accounts and notes receivable | 59 | 96 |
Inventory | 73 | 73 |
Accrued expenses | 305 | 311 |
Deferred revenue | 472 | 365 |
Equity | 148 | 83 |
Net operating losses | 23 | 28 |
Total current | 1,101 | 960 |
Deferred Tax Assets, Tax Credit Carryforwards | 21 | 4 |
Noncurrent assets | ||
Current: | ||
Deferred revenue | 346 | 253 |
Net operating losses | 93 | 78 |
Deferred Tax Assets, Other | 23 | 0 |
Deferred Tax Liabilities, Equity Adjustments | -106 | -139 |
Deferred Tax Assets, Tax Credit Carryforwards | 234 | 280 |
Other comprehensive loss | 103 | 109 |
Deferred Tax Assets, Gross, Noncurrent | 905 | 859 |
Noncurrent liabilities | ||
Current: | ||
Property, plant and equipment, net | -323 | -291 |
Intangible and other assets, net | -605 | -680 |
Other non-current liabilities | 0 | -13 |
Deferred Tax Liability, Total noncurrent | ($928) | ($984) |
Income_Taxes_Rollforward_of_Gr
Income Taxes - Rollforward of Gross Consolidated Liability for Unrecognized Income Tax Benefits (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Unrecognized tax benefits, beginning of year | $266 | $270 | $197 |
Tax positions related to current year: | |||
Additions | 63 | 37 | 25 |
Reductions | 0 | 0 | -1 |
Tax positions related to prior years: | |||
Additions | 91 | 10 | 64 |
Reductions | -31 | -33 | -4 |
Settlements | -1 | -5 | 0 |
Lapses in statutes of limitations | -5 | -13 | -11 |
Unrecognized tax benefits, end of year | $383 | $266 | $270 |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Operating Loss Carryforwards [Line Items] | |||
Effective Income Tax Rate Reconciliation, Tax Credit, Research, Percent | 3.50% | ||
Net operating loss carryforwards and tax credit carryforwards | $34,000,000 | $54,000,000 | $59,000,000 |
International reorganization of acquired companies | 0.00% | 0.60% | 0.30% |
Effective income tax rate | 23.10% | 20.00% | 24.10% |
Net operating loss carryforward, federal | 264,000,000 | ||
Net operating loss carryforward, state | 298,000,000 | ||
Net operating loss carryforward, foreign | 24,000,000 | ||
Valuation Allowances and Reserves, Balance | 4,000,000 | ||
Valuation allowance | 126,000,000 | 211,000,000 | |
Basis differences related to investments in foreign subsidiaries consisted of undistributed earnings | 11,800,000,000 | 10,200,000,000 | |
Total cash, cash equivalents, and short-term and long-term investments | 14,700,000,000 | ||
Income before income taxes from foreign operations | 1,800,000,000 | 2,300,000,000 | 1,900,000,000 |
Income before income taxes from domestic operations | 2,000,000,000 | 1,600,000,000 | 1,900,000,000 |
Unrecognized tax benefits, if recognized, would have been recorded as a reduction to income tax expense | 316,000,000 | 261,000,000 | 255,000,000 |
Recognition (reversal) of previously recorded interest expense resulting from third party settlement | 9,000,000 | 9,000,000 | 4,000,000 |
Unrecognized tax benefits, accrued interest and penalties | 51,000,000 | 42,000,000 | 35,000,000 |
Federal | |||
Operating Loss Carryforwards [Line Items] | |||
Tax credit carryforwards | 4,000,000 | ||
Foreign | |||
Operating Loss Carryforwards [Line Items] | |||
Operating Loss Carryforwards, Valuation Allowance | 1,000,000 | ||
Tax credit carryforwards | 468,000,000 | ||
State and Local Jurisdiction [Member] | |||
Operating Loss Carryforwards [Line Items] | |||
Operating Loss Carryforwards, Valuation Allowance | 4,000,000 | ||
Tax Credit Carryforward, Valuation Allowance | 121,000,000 | ||
VMware | |||
Operating Loss Carryforwards [Line Items] | |||
Total cash, cash equivalents, and short-term and long-term investments | 7,100,000,000 | ||
VMware | International Entities | |||
Operating Loss Carryforwards [Line Items] | |||
Total cash, cash equivalents, and short-term and long-term investments | 5,000,000,000 | ||
EMC | International Entities | |||
Operating Loss Carryforwards [Line Items] | |||
Total cash, cash equivalents, and short-term and long-term investments | 5,300,000,000 | ||
Other non-current assets | |||
Operating Loss Carryforwards [Line Items] | |||
Net non-current state and foreign deferred tax assets | $157,000,000 | $133,000,000 |
Retirement_Plan_Benefits_Compo
Retirement Plan Benefits - Components of Change in Benefit Obligation of Pension Plans (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | ||
Benefit obligation, at beginning of year | $495 | $539 |
Interest cost | 22 | 20 |
Benefits paid | -19 | -18 |
Actuarial loss (gain) | 56 | -46 |
Benefit obligation, at end of year | $554 | $495 |
Retirement_Plan_Benefits_Recon
Retirement Plan Benefits - Reconciliation of Beginning and Ending Balances of Fair Value of Assets of Pension Plans (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Compensation and Retirement Disclosure [Abstract] | ||
Fair value of plan assets, at beginning of year | $449 | $431 |
Actual return on plan assets | 56 | 35 |
Defined Benefit Plan, Contributions by Employer | 0 | 1 |
Benefits paid | -19 | -18 |
Fair value of plan assets, at end of year | $486 | $449 |
Retirement_Plan_Benefits_Compo1
Retirement Plan Benefits - Components of Net Periodic Expense of Pension Plans (Details) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Compensation and Retirement Disclosure [Abstract] | ||
Interest cost | $22 | $20 |
Expected return on plan assets | -29 | -28 |
Recognized actuarial loss | 9 | 15 |
Net periodic expense | $2 | $7 |
Retirement_Plan_Benefits_Weigh
Retirement Plan Benefits - Weighted Average Assumptions Used in Pension Plans to Determine Benefit Obligations (Details) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Compensation and Retirement Disclosure [Abstract] | |||
Discount rate | 3.86% | 4.66% | 3.70% |
Retirement_Plan_Benefits_Weigh1
Retirement Plan Benefits - Weighted Average Assumptions Used in Pension Plans to Determine Periodic Benefit Cost (Details) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Compensation and Retirement Disclosure [Abstract] | |||
Discount rate | 4.66% | 3.71% | 4.55% |
Expected long-term rate of return on plan assets | 6.75% | 6.75% | 6.75% |
Retirement_Plan_Benefits_Benef
Retirement Plan Benefits - Benefit Payments (Details) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Compensation and Retirement Disclosure [Abstract] | |
2015 | $21 |
2016 | 22 |
2017 | 23 |
2018 | 25 |
2019 | 27 |
2020-2024 | $159 |
Retirement_Plan_Benefits_Pensi
Retirement Plan Benefits - Pension Plan Assets at Fair Value (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | $486 | $449 | $431 |
Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 2 | 2 | |
Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 482 | 444 | |
Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Common collective trusts | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 350 | 330 | |
Common collective trusts | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Common collective trusts | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 350 | 330 | |
Common collective trusts | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
U.S. Treasury securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 2 | 2 | |
U.S. Treasury securities | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 2 | 2 | |
U.S. Treasury securities | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
U.S. Treasury securities | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Corporate debt securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 132 | 114 | |
Corporate debt securities | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Corporate debt securities | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 132 | 114 | |
Corporate debt securities | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 0 | 0 | |
Plan payables, net of accrued interest and dividends | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | 2 | 3 | |
Total fixed income securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Defined Benefit Plan, Fair Value of Plan Assets | $484 | $446 |
Retirement_Plan_Benefits_Pensi1
Retirement Plan Benefits - Pension Plan Investments at Fair Value Represented 5% or More of Pension Plan Net Assets (Details) (Pension Plan Net Assets, Credit Concentration Risk, USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Pension plan investments, at fair value | $421 | $385 |
EB Daily Valued Small Cap Stock Index Fund | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Pension plan investments, at fair value | 30 | 30 |
EB Daily Valued Stock Index Fund | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Pension plan investments, at fair value | 103 | 104 |
EB Daily Valued International Stock Index Fund | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Pension plan investments, at fair value | 27 | 30 |
EB Long Term Government Bond Index | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Pension plan investments, at fair value | 50 | 40 |
EB Long Term Credit Bond Index | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Pension plan investments, at fair value | 74 | 63 |
Corporate Debt Securities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Pension plan investments, at fair value | 0 | 118 |
Custom Long Duration Fixed Income [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Pension plan investments, at fair value | $137 | $0 |
Retirement_Plan_Benefits_Weigh2
Retirement Plan Benefits - Weighted Average Target Asset Allocations (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Defined Benefit Plan Disclosure [Line Items] | |
Weighted average target asset allocation | 100.00% |
U.S. large capitalization equities | |
Defined Benefit Plan Disclosure [Line Items] | |
Weighted average target asset allocation | 17.00% |
U.S. small capitalization equities | |
Defined Benefit Plan Disclosure [Line Items] | |
Weighted average target asset allocation | 4.00% |
International equities | |
Defined Benefit Plan Disclosure [Line Items] | |
Weighted average target asset allocation | 4.00% |
U.S. long-duration fixed income | |
Defined Benefit Plan Disclosure [Line Items] | |
Weighted average target asset allocation | 75.00% |
Retirement_Plan_Benefits_Actua
Retirement Plan Benefits - Actual Allocation of the Assets in the Pension Plan (Details) | Dec. 31, 2014 | Dec. 31, 2013 |
Defined Benefit Plan Disclosure [Line Items] | ||
Actual allocation of the Pension Plan assets | 100.00% | 100.00% |
U.S. large capitalization equities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual allocation of the Pension Plan assets | 30.00% | 33.00% |
U.S. small capitalization equities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual allocation of the Pension Plan assets | 6.00% | 7.00% |
International equities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual allocation of the Pension Plan assets | 7.00% | 8.00% |
U.S. long-duration fixed income | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual allocation of the Pension Plan assets | 54.00% | 49.00% |
Below Investment Grade Corporate Fixed Income | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual allocation of the Pension Plan assets | 0.00% | 3.00% |
Below Investment Grade Corporate Fixed Income [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Actual allocation of the Pension Plan assets | 3.00% | 0.00% |
Retirement_Plan_Benefits_Addit
Retirement Plan Benefits - Additional Information (Details) (USD $) | 12 Months Ended | 84 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Defined Contribution Plan, Employer Discretionary Contribution Amount | $105,000,000 | $91,000,000 | $88,000,000 | |
Fair value of company stock fund held by Pension Plan | 486,000,000 | 449,000,000 | 431,000,000 | 486,000,000 |
Under-funded status of Pension Plan | 68,000,000 | 46,000,000 | 68,000,000 | |
Accumulated actuarial loss and prior services cost reclassified from accumulated comprehensive loss to a component of net periodic benefit cost | 9,000,000 | |||
Pension Plans net losses, primarily the result of a decrease in the discount rate at the end of 2011 | 30,000,000 | 30,000,000 | ||
Total balance included in accumulated other comprehensive loss that will be recognized as a component of net periodic benefit cost in 2013 | 12,000,000 | |||
Concentration risk, percentage of Pension Plan net assets | 5.00% | 5.00% | ||
Maximum | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Employer matching contribution percentage | 6.00% | |||
Employer matching contribution, amount per quarter | 750 | |||
EMC | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Fair value of company stock fund held by Pension Plan | $0 | 0 | ||
EMC | Maximum | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Deferred compensation program limit for employee's investment allocation in the company stock fund | 30.00% |
Commitments_and_Contingencies_1
Commitments and Contingencies - Rent Expense on Operating Leases (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Commitments and Contingencies Disclosure [Abstract] | |||
Rent expense | $361 | $328 | $312 |
Sublease proceeds | -2 | -2 | -4 |
Net rent expense | $359 | $326 | $308 |
Commitments_and_Contingencies_2
Commitments and Contingencies - Future Operating Lease Commitments (Details) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Commitments and Contingencies Disclosure [Abstract] | |
2015 | $328 |
2016 | 281 |
2017 | 224 |
2018 | 162 |
2019 | 117 |
Thereafter | 826 |
Total minimum lease payments | $1,938 |
Commitments_and_Contingencies_3
Commitments and Contingencies - Additional Information (Detail) (USD $) | Dec. 31, 2014 |
Other Commitments [Line Items] | |
Guarantees of subsidiaries | $125,000,000 |
Outstanding purchase orders | 2,900,000,000 |
Future Minimum Sublease Rentals, Operating Leases, Due Total | 9,000,000 |
Minimum | |
Other Commitments [Line Items] | |
Future Minimum Sublease Rentals, Operating Leases, Due Per Year | 1,000,000 |
Maximum | |
Other Commitments [Line Items] | |
Future Minimum Sublease Rentals, Operating Leases, Due Per Year | $3,000,000 |
Stockholders_Equity_Reconcilia
Stockholders' Equity - Reconciliation from Basic To Diluted Earnings Per Share for both Numerators and Denominators (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Numerator: | |||||||||||
Net income attributable to EMC Corporation | $1,147 | $587 | $589 | $392 | $1,022 | $586 | $701 | $580 | $2,714 | $2,889 | $2,733 |
Incremental dilution from VMware | 7 | 8 | 10 | ||||||||
Net income – dilution attributable to EMC Corporation | $2,707 | $2,881 | $2,723 | ||||||||
Denominator: | |||||||||||
Weighted average shares, basic | 2,028 | 2,074 | 2,093 | ||||||||
Weighted common stock equivalents (in shares) | 26 | 28 | 40 | ||||||||
Assumed conversion of the 2013 Notes and associated warrants (in shares) | 5 | 58 | 73 | ||||||||
Weighted average shares, diluted (in shares) | 2,059 | 2,160 | 2,206 |
Stockholders_Equity_Accumulate
Stockholders' Equity - Accumulated Other Comprehensive Loss, Net of Tax (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Other Comprehensive Income Before Reclassifications | ($76) | ($19) | |
Income tax provision | 868 | 772 | 918 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | -51 | -12 | |
Accumulated other comprehensive income (loss), net | -366 | -239 | -208 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | -127 | -31 | |
Accumulated Translation Adjustment | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Other Comprehensive Income Before Reclassifications | -135 | -44 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | 0 | |
Accumulated other comprehensive income (loss), net | -188 | -53 | -9 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | -135 | -44 | |
Accumulated Net Unrealized Investment Gain (Loss) | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Other Comprehensive Income Before Reclassifications | 57 | -22 | |
Income tax provision | 31 | 18 | 37 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | -39 | -11 | |
Accumulated other comprehensive income (loss), net | 49 | 31 | 64 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 18 | -33 | |
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Other Comprehensive Income Before Reclassifications | 24 | 13 | |
Income tax provision | -64 | -66 | -67 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | -18 | -10 | |
Accumulated other comprehensive income (loss), net | -100 | -106 | -109 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 6 | 3 | |
Accumulated Defined Benefit Plans Adjustment | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Other Comprehensive Income Before Reclassifications | -22 | 34 | |
Income tax provision | -70 | -61 | -87 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 6 | 9 | |
Accumulated other comprehensive income (loss), net | -126 | -110 | -153 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | -16 | 43 | |
Non-controlling Interest in VMware | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Other Comprehensive Income Before Reclassifications | 0 | 0 | |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | 0 | |
Accumulated other comprehensive income (loss), net | -1 | -1 | -1 |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | $0 | $0 |
Stockholders_Equity_Reclassifi
Stockholders' Equity Reclassification Out of Accumulated Other Comprehensive Income (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||
Investment income | $123 | $128 | $115 |
Income tax provision | -868 | -772 | -918 |
Product revenues | 14,051 | 13,690 | 13,061 |
Cost of product sales | -5,738 | -5,650 | -5,259 |
Net income | 2,894 | 3,093 | 2,886 |
Interest expense | -147 | -156 | -79 |
Income before provision for income taxes | 3,762 | 3,865 | 3,804 |
Accumulated Net Unrealized Investment Gain (Loss) | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||
Income tax provision | -31 | -18 | -37 |
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||
Income tax provision | 64 | 66 | 67 |
Accumulated Defined Benefit Plans Adjustment | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||
Income tax provision | 70 | 61 | 87 |
Reclassification out of Accumulated Other Comprehensive Income | Accumulated Defined Benefit Plans Adjustment | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||
Income tax provision | 3 | 6 | |
Net income | -6 | -9 | |
Other Cost and Expense, Operating | -9 | -15 | |
Foreign Exchange Contract | Reclassification out of Accumulated Other Comprehensive Income | Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||
Income tax provision | 0 | -2 | |
Product revenues | 39 | 12 | |
Cost of product sales | -10 | 0 | |
Net income | 18 | 10 | |
Income before provision for income taxes | 18 | 12 | |
Interest rate swap contract | Reclassification out of Accumulated Other Comprehensive Income | Accumulated Net Gain Loss Interest Rate Swap | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||
Interest expense | -11 | 0 | |
Unrealized Gain on Investments [Member] | Reclassification out of Accumulated Other Comprehensive Income | Accumulated Net Unrealized Investment Gain (Loss) | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||
Investment income | 62 | 17 | |
Income tax provision | -23 | -6 | |
Net income | $39 | $11 |
Stockholders_Equity_Additional
Stockholders' Equity - Additional Information (Detail) (USD $) | 12 Months Ended | 22 Months Ended | 1 Months Ended | |||||||||||||||||
Share data in Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Nov. 30, 2006 | Mar. 17, 2014 | Dec. 09, 2014 | Dec. 01, 2014 | Jul. 30, 2014 | Apr. 17, 2014 | Feb. 06, 2014 | Dec. 12, 2013 | Aug. 01, 2013 | 30-May-13 | Feb. 28, 2013 | Jan. 01, 2015 | Aug. 31, 2014 | Aug. 31, 2013 | Nov. 30, 2012 | Feb. 29, 2012 |
Sold warrants to acquire shares of our common stock, exercise price per share | 19.55 | |||||||||||||||||||
Common stock excluded from calculation of diluted earnings per share | 2 | 4 | 4 | |||||||||||||||||
Stock Repurchase Program, Number of Shares Authorized to be Repurchased | 500 | 500 | 250 | 250 | ||||||||||||||||
Total Repurchases of Common Stock, shares | 107 | 201 | ||||||||||||||||||
Total Repurchases of Common Stock | $3,000,000,000 | $3,000,000,000 | $5,400,000,000 | |||||||||||||||||
Stock repurchase program, remaining number of shares authorized to be repurchased | 299 | 299 | ||||||||||||||||||
Cash dividends declared per common share | $0.45 | $0.30 | $0 | |||||||||||||||||
Dividends Payable, Amount Per Share | $0.12 | $0.12 | $0.12 | $0.10 | $0.10 | $0.10 | $0.10 | |||||||||||||
Sold Warrants | ||||||||||||||||||||
Sold warrants to acquire shares of our common stock | 215 | |||||||||||||||||||
Warrant | ||||||||||||||||||||
Warrants and Rights Outstanding | 109,000,000 | |||||||||||||||||||
Exercised Warrants | ||||||||||||||||||||
Conversion of Stock, Shares Issued | 29 | |||||||||||||||||||
VMware Stock Repurchase Plan | VMware Class A common stock | ||||||||||||||||||||
Stock Repurchase Program, Authorized Amount | 1,000,000,000 | 1,000,000,000 | 700,000,000 | 250,000,000 | 600,000,000 | |||||||||||||||
Total Repurchases of Common Stock, shares | 8 | 7 | 5 | |||||||||||||||||
Total Repurchases of Common Stock | $700,000,000 | $500,000,000 | $500,000,000 | |||||||||||||||||
Stock Repurchased During Period, Amount Per Share | $91.61 | $76.58 | $91.10 |
Stockholders_Equity_Dividends_
Stockholders' Equity Dividends Declared (Details) (USD $) | 0 Months Ended | |||||||||||||
In Millions, except Per Share data, unless otherwise specified | Dec. 09, 2014 | Jul. 30, 2014 | Apr. 17, 2014 | Feb. 06, 2014 | Dec. 12, 2013 | Aug. 01, 2013 | 30-May-13 | Dec. 09, 2014 | Jul. 30, 2014 | Apr. 17, 2014 | Feb. 06, 2014 | Dec. 12, 2013 | Aug. 01, 2013 | 30-May-13 |
Statement of Stockholders' Equity [Abstract] | ||||||||||||||
Dividends Payable, Date Declared | 9-Dec-14 | 30-Jul-14 | 17-Apr-14 | 6-Feb-14 | 12-Dec-13 | 1-Aug-13 | 30-May-13 | |||||||
Dividends Payable, Amount Per Share | $0.12 | $0.12 | $0.12 | $0.10 | $0.10 | $0.10 | $0.10 | |||||||
Dividends Payable, Date of Record | 2-Jan-15 | 1-Oct-14 | 1-Jul-14 | 1-Apr-14 | 8-Jan-14 | 1-Oct-13 | 1-Jul-13 | |||||||
Dividends, Common Stock, Cash | $234 | $239 | $237 | $209 | $206 | $210 | $212 | |||||||
Dividends Payable, Date to be Paid | 23-Jan-15 | 23-Oct-14 | 23-Jul-14 | 23-Apr-14 | 23-Jan-14 | 23-Oct-13 | 23-Jul-13 |
StockBased_Compensation_Employ
Stock-Based Compensation - Employee Stock Purchase Plan Activity (Details) (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
EMC Employee Stock Purchase - 1989 Plan | Common Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Cash proceeds | $186 | $82 | $154 |
Common shares purchased | 8 | 4 | 7 |
Weighted-average price per share | $22.44 | $20.08 | $21.65 |
VMware | VMware Employee Stock Purchase - 2007 Plan | VMware Class A common stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Cash proceeds | $80 | $76 | $69 |
Common shares purchased | 1 | 1 | 1 |
Weighted-average price per share | $73.21 | $65.97 | $77.34 |
StockBased_Compensation_Stock_
Stock-Based Compensation - Stock Option Activity (Details) (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
VMware Stock Options | |||
Options Activity, Number of Shares [Roll Forward] | |||
Outstanding | 6 | 10 | 16 |
Granted | 2 | 1 | 1 |
Forfeited | -1 | ||
Exercised | -2 | -5 | -6 |
Outstanding | 6 | 6 | 10 |
Exercisable | 3 | ||
Vested and expected to vest | 6 | ||
Options Activity, Weighted Average Exercise Price [Roll Forward] | |||
Outstanding | $44.12 | $34.36 | $35.27 |
Granted | $50.91 | $71.53 | $4.67 |
Forfeited | $42.07 | ||
Exercised | $35.58 | $28.12 | $30.44 |
Outstanding | $50.54 | $44.12 | $34.36 |
Exercisable | $37.40 | ||
Vested and expected to vest | $48.57 | ||
EMC Information Infrastructure Stock Options | |||
Options Activity, Number of Shares [Roll Forward] | |||
Outstanding | 57 | 77 | 112 |
Options granted relating to business acquisitions | 8 | 1 | 2 |
Granted | 0 | 0 | 1 |
Forfeited | -1 | -1 | -2 |
Expired | 0 | 0 | -1 |
Exercised | -24 | -20 | -35 |
Outstanding | 40 | 57 | 77 |
Exercisable | 31 | ||
Vested and expected to vest | 39 | ||
Options Activity, Weighted Average Exercise Price [Roll Forward] | |||
Outstanding | $14.56 | $14.39 | $13.69 |
Options granted relating to business acquisitions | $0.62 | $3.29 | $1.54 |
Granted | $0 | $0 | $26.80 |
Forfeited | $13.55 | $13.36 | $13.75 |
Expired | $0 | $0 | $14.19 |
Exercised | $13.19 | $13.10 | $11.65 |
Outstanding | $12.68 | $14.56 | $14.39 |
Exercisable | $15.27 | ||
Vested and expected to vest | $13.06 |
StockBased_Compensation_Restri
Stock-Based Compensation - Restricted Stock and Restricted Stock Unit Activity (Details) (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
VMware Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Outstanding | 13 | 12 | 10 |
Granted | 6 | 7 | 8 |
Vested | -5 | -4 | -4 |
Forfeited | -1 | -2 | -2 |
Outstanding | 13 | 13 | 12 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |||
Outstanding | $85.85 | $91.93 | $72.74 |
Granted | $92.82 | $76.20 | $101.73 |
Vested | $86.27 | $83.21 | $69.01 |
Forfeited | $88.03 | $90.55 | $81.53 |
Outstanding | $88.88 | $85.85 | $91.93 |
EMC Information Infrastructure Restricted Stock and Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Outstanding | 48 | 47 | 46 |
Granted | 23 | 20 | 21 |
Vested | -14 | -15 | -16 |
Forfeited | -4 | -4 | -4 |
Outstanding | 53 | 48 | 47 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |||
Outstanding | $25.43 | $24.39 | $21.10 |
Granted | $27.65 | $25.55 | $26.57 |
Vested | $24.89 | $22.61 | $18.92 |
Forfeited | $25.63 | $24.80 | $23.09 |
Outstanding | $26.50 | $25.43 | $24.39 |
StockBased_Compensation_Stock_1
Stock-Based Compensation - Stock Repurchase Programs (Details) (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Payments for Repurchase of Equity [Abstract] | |||
Aggregate purchase price | $3,000 | $3,000 | $700 |
VMware Stock Repurchase Plan | VMware Class A common stock | |||
Payments for Repurchase of Equity [Abstract] | |||
Weighted-average price per share | $91.61 | $76.58 | $91.10 |
StockBased_Compensation_Compon
Stock-Based Compensation - Components of Stock-Based Compensation Expense (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | $1,021 | $935 | $920 |
Income tax benefit | 224 | 226 | 230 |
Total stock-based compensation, net of tax | 797 | 709 | 690 |
Cost of product sales | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | 54 | 48 | 52 |
Cost of services | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | 92 | 76 | 74 |
Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | 382 | 357 | 324 |
Selling, general and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | 493 | 454 | 470 |
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | 193 | 191 | 262 |
Income tax benefit | 45 | 56 | 68 |
Total stock-based compensation, net of tax | 148 | 135 | 194 |
Stock Options | Cost of product sales | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | 16 | 19 | 22 |
Stock Options | Cost of services | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | 20 | 15 | 21 |
Stock Options | Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | 79 | 75 | 88 |
Stock Options | Selling, general and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | 78 | 82 | 131 |
Restricted Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | 828 | 744 | 658 |
Income tax benefit | 179 | 170 | 162 |
Total stock-based compensation, net of tax | 649 | 574 | 496 |
Restricted Stock | Cost of product sales | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | 38 | 29 | 30 |
Restricted Stock | Cost of services | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | 72 | 61 | 53 |
Restricted Stock | Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | 303 | 282 | 236 |
Restricted Stock | Selling, general and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense before income taxes | $415 | $372 | $339 |
StockBased_Compensation_Net_Ch
Stock-Based Compensation - Net Change in Amounts Capitalized or Accrued (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Other assets | ($345) | ($269) | ($174) |
Deferred Compensation, Share-based Payments | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Accrued expenses (accrued warranty expenses) | 0 | -1 | |
Other assets | ($19) | $2 |
StockBased_Compensation_Weight
Stock-Based Compensation - Weighted Average Assumptions Used to Estimate Fair Value of Awards (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
EMC Information Infrastructure Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend yield | 0.00% | 0.00% | 0.00% |
Expected volatility | 34.30% | ||
Risk-free interest rate | 0.80% | ||
Expected term (in years) | 5 years 2 months 12 days | ||
Weighted-average fair value at grant date (in usd per share) | $8.56 | ||
VMware Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend yield | 0.00% | 0.00% | 0.00% |
Expected volatility | 36.20% | 38.50% | 35.80% |
Risk-free interest rate | 0.90% | 0.90% | 0.30% |
Expected term (in years) | 3 years 2 months 0 days | 3 years 6 months 20 days | 2 years 7 months 12 days |
Weighted-average fair value at grant date (in usd per share) | 48.47 | 29.47 | $80.45 |
EMC Employee Stock Purchase - 1989 Plan | Common Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend yield | 0.00% | 0.00% | 0.00% |
VMware | VMware Employee Stock Purchase - 2007 Plan | VMware Class A common stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Dividend yield | 0.00% | 0.00% | 0.00% |
Expected volatility | 32.30% | 32.90% | 37.80% |
Risk-free interest rate | 0.10% | 0.10% | 0.10% |
Expected term (in years) | 0 years 6 months 0 days | 0 years 6 months 0 days | 6 months |
Weighted-average fair value at grant date (in usd per share) | 20.71 | 20.45 | $23.36 |
StockBased_Compensation_Additi
Stock-Based Compensation - Additional Information (Details) (USD $) | 1 Months Ended | 12 Months Ended | 1 Months Ended | ||||
In Millions, except Share data, unless otherwise specified | 31-May-07 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | 31-May-13 | 31-May-09 | Dec. 31, 2011 |
Plan | Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Exercise price for a stock option, minimum percentage of fair market value | 100.00% | ||||||
Period from date of grant that options expire (no later than ten years after the date of grant) | 10 years | ||||||
Number of other stock option plans, in addition to 2003 Plan | 4 | ||||||
Number of plans consolidated into the 2003 Plan | 4 | ||||||
Common stock, shares reserved for future issuance | 982,000,000 | ||||||
Number of plans | 5 | ||||||
Outstanding and unvested, intrinsic value | $1,570,000,000 | ||||||
ESPP, stock-based compensation expense | $57 | $54 | $52 | ||||
Unrecognized compensation expense | 1,515 | ||||||
Unrecognized compensation expense, weighted-average remaining period | 1 year 6 months | ||||||
Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Period from date of grant that options become exercisable | 5 years | ||||||
Period from date of grant that options expire (no later than ten years after the date of grant) | 10 years | ||||||
Common Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares authorized for grant | 420,000,000 | ||||||
Number of shares available for grant | 41,000,000 | ||||||
EMC Employee Stock Purchase - 1989 Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Other Employee Related Liabilities, Current | 84 | ||||||
Common stock, shares reserved for future issuance | 183,000,000 | ||||||
EMC Employee Stock Purchase - 1989 Plan | Common Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Purchase price of common stock, as a percent of fair market value | 85.00% | ||||||
VMware 2007 Equity and Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares authorized for grant | 100,000,000 | ||||||
Number of shares available for grant | 18,000,000 | ||||||
Increase in number of shares available for issuance | 13,000,000 | 20,000,000 | |||||
Number of shares assumed in business acquisitions | 4,000,000 | ||||||
VMware Stock Repurchase Plan | VMware Class A common stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock repurchase plan, amount remaining for repurchase | 960 | ||||||
VMware Employee Stock Purchase Plan - 2007 Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares available for grant | 6,000,000 | ||||||
VMware Employee Stock Purchase Plan - 2007 Plan | VMware Class A common stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Common stock, shares reserved for future issuance | 8,000,000 | ||||||
Purchase price of stock, percent of market value on grant date | 85.00% | ||||||
Purchase price of stock, percent of market value on exercise date | 85.00% | ||||||
ESPP withholding payable | 46 | ||||||
Vesting Upon Fulfilling Service Conditions | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Expected to vest (in shares) | 45,000,000 | ||||||
Vesting Accelerated Upon Achieving Performance Conditions | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Expected to vest (in shares) | 9,000,000 | ||||||
Vesting Upon Achieving Certain Performance Conditions | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Expected to vest (in shares) | 8,000,000 | ||||||
VMware Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Outstanding and unvested (in shares) | 13,000,000 | 13,000,000 | 12,000,000 | 10,000,000 | |||
Outstanding and unvested, intrinsic value | $1,039,000,000 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | 480 | 340 | 347 | ||||
VMware Restricted Stock | VMware 2007 Equity and Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Purchase price of common stock, as a percent of fair market value | 25.00% | ||||||
VMware Restricted Stock | VMware 2007 Equity and Incentive Plan | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock vesting period | 3 years | ||||||
VMware Restricted Stock | VMware 2007 Equity and Incentive Plan | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock vesting period | 4 years | ||||||
VMware Stock Options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Options, exercisable, aggregate intrinsic value | 128 | ||||||
Options, exercisable | 3,000,000 | ||||||
Options, vested and expected to vest | 6,000,000 | ||||||
Options, vested and expected to vest, weighted average remaining contractual term | 4 years 2 months 35 days | ||||||
Options, vested and expected to vest, aggregate intrinsic value | 204 | ||||||
Closing stock price | $82.52 | ||||||
Options, exercised, aggregate intrinsic value | 147 | 256 | 443 | ||||
Stock options exercisable, weighted-average remaining contractual term | 2 years 0 months 32 days | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested in Period, Fair Value | 64 | 60 | 72 | ||||
VMware Stock Options | VMware 2007 Equity and Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock vesting period | 3 years | ||||||
Purchase price of common stock, as a percent of fair market value | 25.00% | ||||||
VMware Stock Options | VMware 2007 Equity and Incentive Plan | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Period from date of grant that options expire (no later than ten years after the date of grant) | 6 years | ||||||
VMware Stock Options | VMware 2007 Equity and Incentive Plan | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Period from date of grant that options expire (no later than ten years after the date of grant) | 7 years | ||||||
VMware Stock Options | VMware | VMware 2007 Equity and Incentive Plan | VMware Class A common stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Purchase price of common stock, as a percent of fair market value | 100.00% | ||||||
EMC Information Infrastructure Restricted Stock and Restricted Stock Units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock vesting period | 2 years | ||||||
Number of shares reserved for every one share issued in connection with awards | 2 | ||||||
Vested, intrinsic value | 388 | 404 | 421 | ||||
Outstanding and unvested (in shares) | 53,000,000 | 48,000,000 | 47,000,000 | 46,000,000 | |||
EMC Information Infrastructure Restricted Stock and Restricted Stock Units | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock vesting period | 2 years | ||||||
EMC Information Infrastructure Restricted Stock and Restricted Stock Units | Pro Rata Vesting | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock vesting period | 3 years | ||||||
EMC Information Infrastructure Restricted Stock and Restricted Stock Units | Pro Rata Vesting | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock vesting period | 4 years | ||||||
EMC Information Infrastructure Restricted Stock and Restricted Stock Units | Cliff Vesting | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock vesting period | 3 years | ||||||
EMC Information Infrastructure Restricted Stock and Restricted Stock Units | Cliff Vesting | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted stock vesting period | 5 years | ||||||
EMC Information Infrastructure Stock Options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Weighted average remaining contractual term | 3 years | ||||||
Options, exercisable, aggregate intrinsic value | 447 | ||||||
Options, exercisable | 31,000,000 | ||||||
Options, vested and expected to vest | 39,000,000 | ||||||
Options, vested and expected to vest, weighted average remaining contractual term | 2 years 11 months | ||||||
Options, vested and expected to vest, aggregate intrinsic value | 651 | ||||||
Closing stock price | $29.74 | ||||||
Options, exercised, aggregate intrinsic value | 353 | 240 | 518 | ||||
Cash proceeds from the exercise of stock options | 317 | 260 | 407 | ||||
Income tax benefits realized from the exercise of stock options | $61 | $45 | $97 |
Restructuring_and_AcquisitionR2
Restructuring and Acquisition-Related Charges - Activity For Restructuring Program (Detail) (USD $) | 12 Months Ended | |||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2015 |
Restructuring Reserve [Roll Forward] | ||||
Charges/Adjustments to the Provision | $210 | $139 | $101 | |
VMware | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | 0 | ||
Charges/Adjustments to the Provision | 18 | 54 | ||
Utilization | -54 | |||
Ending Balance | 0 | |||
VMware | Workforce reductions | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Charges/Adjustments to the Provision | 54 | |||
Utilization | -54 | |||
Ending Balance | 0 | |||
VMware | Consolidation of excess facilities and other contractual obligations | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Charges/Adjustments to the Provision | 0 | |||
Utilization | 0 | |||
Ending Balance | 0 | |||
VMware | Restructuring 2014 Programs | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Charges/Adjustments to the Provision | 18 | |||
Utilization | -10 | |||
Ending Balance | 8 | |||
VMware | Restructuring 2014 Programs | Workforce reductions | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Charges/Adjustments to the Provision | 18 | |||
Utilization | -10 | |||
Ending Balance | 8 | |||
VMware | Restructuring 2014 Programs | Consolidation of excess facilities and other contractual obligations | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Charges/Adjustments to the Provision | 0 | |||
Utilization | 0 | |||
Ending Balance | 0 | |||
EMC Information Infrastructure | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 91 | 80 | ||
Charges/Adjustments to the Provision | 139 | 101 | ||
Utilization | -140 | -90 | ||
Ending Balance | 90 | 91 | ||
EMC Information Infrastructure | Workforce reductions | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 63 | 50 | ||
Charges/Adjustments to the Provision | 121 | 80 | ||
Utilization | -118 | -67 | ||
Ending Balance | 66 | 63 | ||
EMC Information Infrastructure | Consolidation of excess facilities and other contractual obligations | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 28 | 30 | ||
Charges/Adjustments to the Provision | 18 | 21 | ||
Utilization | -22 | -23 | ||
Ending Balance | 24 | 28 | ||
EMC Information Infrastructure | Restructuring 2014 Programs | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Charges/Adjustments to the Provision | 230 | |||
Utilization | -127 | |||
Ending Balance | 103 | |||
EMC Information Infrastructure | Restructuring 2014 Programs | Workforce reductions | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Charges/Adjustments to the Provision | 212 | |||
Utilization | -115 | |||
Ending Balance | 97 | |||
EMC Information Infrastructure | Restructuring 2014 Programs | Consolidation of excess facilities and other contractual obligations | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Charges/Adjustments to the Provision | 18 | |||
Utilization | -12 | |||
Ending Balance | 6 | |||
EMC Information Infrastructure | Restructuring other programs | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 90 | |||
Charges/Adjustments to the Provision | -20 | |||
Utilization | -52 | |||
Ending Balance | 18 | |||
EMC Information Infrastructure | Restructuring other programs | Workforce reductions | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 66 | |||
Charges/Adjustments to the Provision | 20 | |||
Utilization | -41 | |||
Ending Balance | 5 | |||
EMC Information Infrastructure | Restructuring other programs | Consolidation of excess facilities and other contractual obligations | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 24 | |||
Charges/Adjustments to the Provision | 0 | |||
Utilization | -11 | |||
Ending Balance | 13 | |||
Subsequent Event | Minimum | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Expected Cost | 130 | |||
Restructuring Reserve [Roll Forward] | ||||
Restructuring and Related Cost, Expected Cost, to be Settled with Cash | 120 | |||
Subsequent Event | Maximum | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and Related Cost, Expected Cost | 150 | |||
Restructuring Reserve [Roll Forward] | ||||
Restructuring and Related Cost, Expected Cost, to be Settled with Cash | $140 |
Restructuring_and_AcquisitionR3
Restructuring and Acquisition-Related Charges - Additional information (Detail) (USD $) | 12 Months Ended | 36 Months Ended | |||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2015 | Dec. 31, 2016 |
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring and acquisition-related charges | $239 | $224 | $110 | ||
Restructuring charges | 210 | 139 | 101 | ||
Acquisition-related charges | 6 | 8 | 9 | ||
Lease termination costs for facilities | 18 | 18 | 21 | ||
Restructuring 2014 Programs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Number of positions eliminated | 2,100 | ||||
Restructuring 2013 Programs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Number of positions eliminated | 1,900 | ||||
Restructuring 2012 Programs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Number of positions eliminated | 1,100 | ||||
VMware | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | 18 | 54 | |||
Acquisition-related charges | 7 | 5 | |||
Asset Impairment Charges | 2 | 18 | |||
Liabilities of Disposal Group, Including Discontinued Operation, Current | 44 | ||||
VMware | Restructuring 2014 Programs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | 18 | ||||
Number of positions eliminated | 180 | ||||
VMware | Restructuring 2013 Programs | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Number of positions eliminated | 710 | ||||
Subsequent Event | 2015 | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Remaining cash portion owed for restructuring programs | 5 | ||||
Subsequent Event | 2016 and beyond | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Remaining cash portion owed for restructuring programs | $2 |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Related Party Transactions [Abstract] | |||
Related party lease payments | $3 | $5 | $5 |
Duration of related party lease - renewed in 2003 | 10 years |
Segment_Information_Segment_In
Segment Information - Segment Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Revenues: | |||||||||||
Product sales | $14,051 | $13,690 | $13,061 | ||||||||
Services | 10,389 | 9,532 | 8,653 | ||||||||
Total consolidated revenues | 7,048 | 6,032 | 5,880 | 5,479 | 6,682 | 5,539 | 5,614 | 5,387 | 24,440 | 23,222 | 21,714 |
Gross profit | 4,505 | 3,743 | 3,654 | 3,347 | 4,224 | 3,442 | 3,509 | 3,298 | 15,249 | 14,473 | 13,638 |
Gross profit percentage | 62.40% | 62.30% | 62.80% | ||||||||
Research and development | 2,991 | 2,761 | 2,560 | ||||||||
Selling, general and administrative | 7,982 | 7,338 | 7,004 | ||||||||
Restructuring and acquisition-related charges | 239 | 224 | 110 | ||||||||
Total costs and expenses | 11,212 | 10,323 | 9,674 | ||||||||
Operating income (loss) | 4,037 | 4,150 | 3,964 | ||||||||
Non-operating income (expense) | -275 | -285 | -160 | ||||||||
Income tax provision | 868 | 772 | 918 | ||||||||
Net income | 2,894 | 3,093 | 2,886 | ||||||||
Net Income (Loss) Attributable to Noncontrolling Interest | -180 | -204 | -153 | ||||||||
Net income attributable to EMC Corporation | 1,147 | 587 | 589 | 392 | 1,022 | 586 | 701 | 580 | 2,714 | 2,889 | 2,733 |
Information Storage | |||||||||||
Revenues: | |||||||||||
Product sales | 10,785 | 10,738 | 10,316 | ||||||||
Services | 5,757 | 5,524 | 5,257 | ||||||||
Total consolidated revenues | 16,542 | 16,262 | 15,573 | ||||||||
Gross profit | 9,180 | 9,109 | 8,911 | ||||||||
Gross profit percentage | 55.50% | 56.00% | 57.20% | ||||||||
Enterprise Content Division | |||||||||||
Revenues: | |||||||||||
Product sales | 164 | 180 | 200 | ||||||||
Services | 476 | 467 | 440 | ||||||||
Total consolidated revenues | 640 | 647 | 640 | ||||||||
Gross profit | 417 | 419 | 432 | ||||||||
Gross profit percentage | 65.20% | 64.80% | 67.50% | ||||||||
RSA Information Security | |||||||||||
Revenues: | |||||||||||
Product sales | 462 | 453 | 414 | ||||||||
Services | 573 | 534 | 475 | ||||||||
Total consolidated revenues | 1,035 | 987 | 889 | ||||||||
Gross profit | 698 | 655 | 604 | ||||||||
Gross profit percentage | 67.40% | 66.40% | 68.00% | ||||||||
EMC Information Infrastructure | |||||||||||
Revenues: | |||||||||||
Product sales | 11,411 | 11,371 | 10,930 | ||||||||
Services | 6,806 | 6,525 | 6,172 | ||||||||
Total consolidated revenues | 18,217 | 17,896 | 17,102 | ||||||||
Gross profit | 10,295 | 10,183 | 9,947 | ||||||||
Gross profit percentage | 56.50% | 56.90% | 58.20% | ||||||||
Research and development | 1,489 | 1,461 | 1,410 | ||||||||
Selling, general and administrative | 4,583 | 4,571 | 4,488 | ||||||||
Restructuring and acquisition-related charges | 0 | 0 | 0 | ||||||||
Total costs and expenses | 6,072 | 6,032 | 5,898 | ||||||||
Operating income (loss) | 4,223 | 4,151 | 4,049 | ||||||||
Pivotal | |||||||||||
Revenues: | |||||||||||
Product sales | 65 | 66 | 73 | ||||||||
Services | 162 | 113 | 64 | ||||||||
Total consolidated revenues | 227 | 179 | 137 | ||||||||
Gross profit | 106 | 91 | 102 | ||||||||
Gross profit percentage | 46.50% | 50.70% | 74.40% | ||||||||
Research and development | 128 | 109 | 116 | ||||||||
Selling, general and administrative | 183 | 161 | 151 | ||||||||
Restructuring and acquisition-related charges | 0 | 0 | 0 | ||||||||
Total costs and expenses | 311 | 270 | 267 | ||||||||
Operating income (loss) | -205 | -179 | -165 | ||||||||
EMC Information Infrastructure plus Pivotal | |||||||||||
Revenues: | |||||||||||
Product sales | 11,476 | 11,437 | 11,003 | ||||||||
Services | 6,968 | 6,638 | 6,236 | ||||||||
Total consolidated revenues | 18,444 | 18,075 | 17,239 | ||||||||
Gross profit | 10,401 | 10,274 | 10,049 | ||||||||
Gross profit percentage | 56.40% | 56.80% | 58.30% | ||||||||
Research and development | 1,617 | 1,570 | 1,526 | ||||||||
Selling, general and administrative | 4,766 | 4,732 | 4,639 | ||||||||
Restructuring and acquisition-related charges | 0 | 0 | 0 | ||||||||
Total costs and expenses | 6,383 | 6,302 | 6,165 | ||||||||
Operating income (loss) | 4,018 | 3,972 | 3,884 | ||||||||
Non-operating income (expense) | -362 | -337 | -177 | ||||||||
Income tax provision | 942 | 911 | 968 | ||||||||
Net income | 2,714 | 2,724 | 2,739 | ||||||||
Net Income (Loss) Attributable to Noncontrolling Interest | 0 | 0 | 0 | ||||||||
Net income attributable to EMC Corporation | 2,714 | 2,724 | 2,739 | ||||||||
VMware Virtual Infrastructure Within EMC Corp | |||||||||||
Revenues: | |||||||||||
Product sales | 2,575 | 2,253 | 2,058 | ||||||||
Services | 3,421 | 2,894 | 2,417 | ||||||||
Total consolidated revenues | 5,996 | 5,147 | 4,475 | ||||||||
Gross profit | 5,241 | 4,589 | 3,976 | ||||||||
Gross profit percentage | 87.40% | 89.20% | 88.90% | ||||||||
Research and development | 987 | 826 | 700 | ||||||||
Selling, general and administrative | 2,390 | 2,003 | 1,739 | ||||||||
Restructuring and acquisition-related charges | 0 | 0 | 0 | ||||||||
Total costs and expenses | 3,377 | 2,829 | 2,439 | ||||||||
Operating income (loss) | 1,864 | 1,760 | 1,537 | ||||||||
Non-operating income (expense) | 34 | 22 | 27 | ||||||||
Income tax provision | 385 | 317 | 271 | ||||||||
Net income | 1,513 | 1,465 | 1,293 | ||||||||
Net Income (Loss) Attributable to Noncontrolling Interest | -308 | -295 | -255 | ||||||||
Net income attributable to EMC Corporation | 1,205 | 1,170 | 1,038 | ||||||||
Corp Reconciling Items | |||||||||||
Revenues: | |||||||||||
Product sales | 0 | 0 | 0 | ||||||||
Services | 0 | 0 | 0 | ||||||||
Total consolidated revenues | 0 | 0 | 0 | ||||||||
Gross profit | -393 | -390 | -387 | ||||||||
Gross profit percentage | 0.00% | 0.00% | 0.00% | ||||||||
Research and development | 387 | 365 | 334 | ||||||||
Selling, general and administrative | 826 | 603 | 626 | ||||||||
Restructuring and acquisition-related charges | 239 | 224 | 110 | ||||||||
Total costs and expenses | 1,452 | 1,192 | 1,070 | ||||||||
Operating income (loss) | -1,845 | -1,582 | -1,457 | ||||||||
Non-operating income (expense) | 53 | 30 | -10 | ||||||||
Income tax provision | -459 | -456 | -321 | ||||||||
Net income | -1,333 | -1,096 | -1,146 | ||||||||
Net Income (Loss) Attributable to Noncontrolling Interest | 128 | 91 | 102 | ||||||||
Net income attributable to EMC Corporation | ($1,205) | ($1,005) | ($1,044) |
Segment_Information_Revenues_B
Segment Information - Revenues By Geographic Area (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Segment Reporting Information [Line Items] | |||||||||||
Total consolidated revenues | $7,048 | $6,032 | $5,880 | $5,479 | $6,682 | $5,539 | $5,614 | $5,387 | $24,440 | $23,222 | $21,714 |
UNITED STATES | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total consolidated revenues | 12,835 | 12,230 | 11,510 | ||||||||
Europe, Middle East and Africa | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total consolidated revenues | 6,981 | 6,355 | 5,908 | ||||||||
Asia Pacific and Japan | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total consolidated revenues | 3,191 | 3,193 | 3,017 | ||||||||
Latin America, Mexico and Canada | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total consolidated revenues | $1,433 | $1,444 | $1,279 |
Segment_Information_Additional
Segment Information - Additional Information (Detail) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Country | Country | |
UNITED STATES | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, excluding financial instruments, deferred tax assets, goodwill and intangible assets | 4,380 | 4,433 |
International | ||
Segment Reporting Information [Line Items] | ||
Long-lived assets, excluding financial instruments, deferred tax assets, goodwill and intangible assets | 1,021 | 877 |
Sales Revenue, Segment | Geographic risk | ||
Segment Reporting Information [Line Items] | ||
Number of countries, other than United States, that accounted for 10% or more of total revenue | 0 | 0 |
Long-lived Assets, Total | Geographic risk | ||
Segment Reporting Information [Line Items] | ||
Number of countries, other than United States, that accounted for 10% or more of total revenue | 0 | 0 |
EMC Information Infrastructure | ||
Segment Reporting Information [Line Items] | ||
Number of operating segments | 3 |
Selected_Quarterly_Financial_D2
Selected Quarterly Financial Data (Unaudited) - Quarterly Financial Data (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Total consolidated revenues | $7,048 | $6,032 | $5,880 | $5,479 | $6,682 | $5,539 | $5,614 | $5,387 | $24,440 | $23,222 | $21,714 |
Gross profit | 4,505 | 3,743 | 3,654 | 3,347 | 4,224 | 3,442 | 3,509 | 3,298 | 15,249 | 14,473 | 13,638 |
Net income attributable to EMC Corporation | $1,147 | $587 | $589 | $392 | $1,022 | $586 | $701 | $580 | $2,714 | $2,889 | $2,733 |
Net income per weighted average share, diluted: common shareholders | $0.56 | $0.28 | $0.28 | $0.19 | $0.48 | $0.27 | $0.32 | $0.26 | $1.32 | $1.33 | $1.23 |
Selected_Quarterly_Financial_D3
Selected Quarterly Financial Data (Unaudited) - Additional Information (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Effect of Fourth Quarter Events [Line Items] | |||||||||
Research and Development tax credit, amount | $62 | $60 | |||||||
Research and Development tax credit, per share impact | $0.03 | $0.03 | |||||||
Gain on strategic investment, net of tax | -33 | -45 | |||||||
Gain on strategic investment, net of tax, per diluted share | $0.02 | $0.02 | |||||||
Impairment of strategic investment | 24 | 33 | 0 | 0 | |||||
Other Than Temporary Impairment Losses, Investments, per share impact | $0.01 | ||||||||
Gain on disposition of business | 11 | 10 | |||||||
Net gain on disposition of business, per share impact | $0.01 | $0.01 | |||||||
Tax Related Reorganization | $4 | $23 | |||||||
Tax Related Reorganization, Earnings Per Share Impact, Net | $0 | ($0.01) |
Subsequent_Events_Details
Subsequent Events (Details) (USD $) | 60 Months Ended | 12 Months Ended | |
Feb. 27, 2020 | Dec. 31, 2015 | Feb. 27, 2015 | |
Subsequent Event [Line Items] | |||
Payments to Acquire Business, Other | $2,500,000,000 | ||
Line of Credit Facility, Expiration Date | 27-Feb-20 | ||
Line of Credit Facility, Description | At our option, subject to certain conditions, any loan under the Credit Agreement will bear interest at a rate equal to, either (i) the LIBOR Rate or (ii) the Base Rate (defined as the highest of (a) the Federal Funds rate plus 0.50%, (b) Citibank, N.A.’s “prime rate†as announced from time to time, or (c) one-month LIBOR plus 1.00%), plus, in each case the Applicable Margin, as defined in the Credit Agreement | ||
line of credit available increase to credit facility | 1,000,000,000 | ||
Subsequent Event | Minimum | |||
Subsequent Event [Line Items] | |||
Expected cost of restructuring | 130,000,000 | ||
Restructuring and Related Cost, Expected Cost, to be Settled with Cash | 120,000,000 | ||
Subsequent Event | Maximum | |||
Subsequent Event [Line Items] | |||
Expected cost of restructuring | 150,000,000 | ||
Restructuring and Related Cost, Expected Cost, to be Settled with Cash | $140,000,000 |
Schedule_II_Valuation_and_Qual1
Schedule II - Valuation and Qualifying Accounts (Details) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at End of Period | $4 | ||
Allowance for Bad Debts | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 65 | 72 | 65 |
Charged to Expense / Reduction in Revenue | 10 | -1 | 39 |
Deductions | -1 | -6 | -32 |
Balance at End of Period | 74 | 65 | 72 |
Allowance for Sales Returns | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 76 | 86 | 133 |
Charged to Expense / Reduction in Revenue | 89 | 55 | 17 |
Deductions | -95 | -65 | -64 |
Balance at End of Period | 70 | 76 | 86 |
Tax Valuation Allowance | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Balance at Beginning of Period | 211 | 183 | 151 |
Charged to Expense / Reduction in Revenue | 1 | 32 | 33 |
Deductions | -86 | -4 | -1 |
Balance at End of Period | $126 | $211 | $183 |