Document and Entity Information
Document and Entity Information | 9 Months Ended |
Sep. 30, 2015shares | |
Document-Document and Entity Information [Abstract] | |
Document Type | 10-Q |
Amendment Flag | false |
Document Period End Date | Sep. 30, 2015 |
Document Fiscal Year Focus | 2,015 |
Document Fiscal Period Focus | Q3 |
Trading Symbol | EMC |
Entity Registrant Name | EMC CORP |
Entity Central Index Key | 790,070 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 1,938,837,339 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 5,324 | $ 6,343 |
Short-term investments | 2,318 | 1,978 |
Accounts and notes receivable, less allowance for doubtful accounts of $87 and $72 | 3,134 | 4,413 |
Inventories | 1,224 | 1,276 |
Deferred income taxes | 1,088 | 1,070 |
Other current assets | 649 | 653 |
Total current assets | 13,737 | 15,733 |
Long-term investments | 6,642 | 6,334 |
Property, plant and equipment, net | 3,791 | 3,766 |
Intangible assets, net | 2,239 | 2,125 |
Goodwill | 17,083 | 16,134 |
Other assets, net | 1,853 | 1,767 |
Total assets | 45,345 | 45,859 |
Current liabilities: | ||
Accounts payable | 1,115 | 1,696 |
Accrued expenses | 2,831 | 3,141 |
Income taxes payable | 208 | 852 |
Short-term debt (See Note 4) | 1,970 | 0 |
Deferred revenue | 6,187 | 6,021 |
Total current liabilities | 12,311 | 11,710 |
Income taxes payable | 380 | 306 |
Deferred revenue | 4,436 | 4,144 |
Deferred income taxes | 317 | 274 |
Long-term debt (See Note 4) | 5,474 | 5,469 |
Other liabilities | 472 | 431 |
Total liabilities | $ 23,390 | $ 22,334 |
Commitments and contingencies (See Note 13) | ||
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 1,939 and 1,985 shares | 19 | 20 |
Additional paid-in capital | 0 | 0 |
Retained earnings | 20,958 | 22,242 |
Accumulated other comprehensive loss, net | (533) | (366) |
Total EMC Corporation’s shareholders’ equity | 20,444 | 21,896 |
Non-controlling interests | 1,511 | 1,629 |
Total shareholders’ equity | 21,955 | 23,525 |
Total liabilities and shareholders’ equity | $ 45,345 | $ 45,859 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Accounts and notes receivable, allowance for doubtful accounts | $ 87 | $ 72 |
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) | 1,939,000,000 | 1,985,000,000 |
Common stock, outstanding (in shares) | 1,939,000,000 | 1,985,000,000 |
CONSOLIDATED INCOME STATEMENTS
CONSOLIDATED INCOME STATEMENTS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenues: | ||||
Product sales | $ 3,269 | $ 3,400 | $ 9,399 | $ 9,728 |
Services | 2,810 | 2,632 | 8,290 | 7,663 |
Total consolidated revenues | 6,079 | 6,032 | 17,689 | 17,391 |
Costs and expenses: | ||||
Cost of product sales | 1,379 | 1,400 | 4,141 | 4,068 |
Cost of services | 995 | 889 | 2,917 | 2,579 |
Research and development | 802 | 767 | 2,372 | 2,239 |
Selling, general and administrative | 2,145 | 1,990 | 6,285 | 5,852 |
Restructuring and acquisition-related charges | 68 | 39 | 226 | 187 |
Operating income | 690 | 947 | 1,748 | 2,466 |
Non-operating income (expense): | ||||
Investment income | 25 | 29 | 76 | 100 |
Interest expense | (41) | (40) | (121) | (108) |
Other income (expense), net | 22 | (103) | 56 | (245) |
Total non-operating income (expense) | 6 | (114) | 11 | (253) |
Income before provision for income taxes | 696 | 833 | 1,759 | 2,213 |
Income tax provision | 168 | 206 | 420 | 532 |
Net income | 528 | 627 | 1,339 | 1,681 |
Less: Net income attributable to the non-controlling interest in VMware, Inc. | (48) | (40) | (120) | (113) |
Net income attributable to EMC Corporation | $ 480 | $ 587 | $ 1,219 | $ 1,568 |
Net income per weighted average share, basic attributable to EMC Corporation common shareholders | $ 0.25 | $ 0.29 | $ 0.63 | $ 0.77 |
Net income per weighted average share, diluted attributable to EMC Corporation common shareholders | $ 0.25 | $ 0.28 | $ 0.62 | $ 0.76 |
Weighted average shares, basic | 1,934 | 2,032 | 1,945 | 2,033 |
Weighted average shares, diluted | 1,948 | 2,057 | 1,963 | 2,065 |
Cash dividends declared per common share | $ 0.12 | $ 0.12 | $ 0.34 | $ 0.33 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 528 | $ 627 | $ 1,339 | $ 1,681 |
Other comprehensive income (loss), net of taxes (benefits): | ||||
Foreign currency translation adjustments | (52) | (61) | (137) | (57) |
Changes in market value of investments: | ||||
Changes in unrealized gains (losses), net of taxes (benefits) of $(20), $16, $(7) and $65 | (31) | 24 | (10) | 107 |
Reclassification adjustment for net losses (gains) realized in net income, net of benefits (taxes) of $(3), $(5), $(16) and $(11) | (5) | (8) | (26) | (19) |
Net change in market value of investments | (36) | 16 | (36) | 88 |
Changes in market value of derivatives: | ||||
Changes in unrealized gains (losses), net of taxes (benefits) of $1, $3, $2 and $3 | 2 | 10 | 11 | 11 |
Reclassification adjustment for net losses (gains) included in net income, net of benefits (taxes) of $2, $0, $4 and $0 | 3 | 1 | (8) | (2) |
Net change in the market value of derivatives | 5 | 11 | 3 | 9 |
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) | 0 | (2) | 0 | (2) |
Reclassification adjustments for net gains from pension and other postretirement plans, net of taxes (benefits) | 0 | (1) | 0 | (1) |
Net change in actuarial gain (loss) from pension and other postretirement plans | 0 | (1) | 0 | (1) |
Other comprehensive income (loss) | (83) | (33) | (170) | 41 |
Comprehensive income | 445 | 594 | 1,169 | 1,722 |
Less: Net income attributable to the non-controlling interest in VMware, Inc. | (48) | (40) | (120) | (113) |
Less: Other comprehensive (income) loss attributable to the non-controlling interest in VMware, Inc. | 6 | 1 | 3 | 0 |
Comprehensive income attributable to EMC Corporation | $ 403 | $ 555 | $ 1,052 | $ 1,609 |
CONSOLIDATED STATEMENTS OF COM6
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Changes in unrealized gains (losses) - taxes (benefits) | $ (20) | $ 16 | $ (7) | $ 65 |
Reclassification adjustment for net losses (gains) realized in net income - benefits (taxes) | (3) | (5) | (16) | (11) |
Changes in market value of derivatives - taxes (benefits) | 1 | 3 | 2 | 3 |
Reclassification adjustment for net losses (gains) realized in net income - benefits (taxes) | $ 2 | $ 0 | $ 4 | $ 0 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash flows from operating activities: | ||
Cash received from customers | $ 19,375 | $ 19,005 |
Cash paid to suppliers and employees | (14,894) | (13,868) |
Dividends and interest received | 98 | 119 |
Interest paid | (68) | (67) |
Income taxes paid | (995) | (897) |
Net cash provided by operating activities | (3,516) | (4,292) |
Cash flows from investing activities: | ||
Additions to property, plant and equipment | (671) | (693) |
Capitalized software development costs | (411) | (382) |
Purchases of short- and long-term available-for-sale securities | (5,553) | (7,989) |
Sales of short- and long-term available-for-sale securities | 3,389 | 6,396 |
Maturities of short- and long-term available-for-sale securities | 1,465 | 2,135 |
Business acquisitions, net of cash acquired | (1,304) | (1,771) |
Purchases of strategic and other related investments | (177) | (101) |
Sales of strategic and other related investments | 135 | 38 |
Joint venture funding | 0 | (163) |
Decrease (increase) in restricted cash | (77) | 76 |
Net cash used in investing activities | (3,050) | (2,606) |
Cash flows from financing activities: | ||
Proceeds from the issuance of EMC’s common stock | 293 | 445 |
Repurchase of common stock | (2,063) | (1,374) |
Excess tax benefits from stock-based compensation | 62 | 85 |
Payment of long-term obligations | 0 | (1,665) |
Net proceeds from the issuance of short-term obligations | 1,968 | 0 |
Dividend payment | (683) | (644) |
Proceeds from noncontrolling interests - issuance of common stock and contributions | 4 | 7 |
Net cash used in financing activities | (1,346) | (3,438) |
Effect of exchange rate changes on cash and cash equivalents | (139) | (84) |
Net decrease in cash and cash equivalents | (1,019) | (1,836) |
Cash and cash equivalents at beginning of period | 6,343 | 7,891 |
Cash and cash equivalents at end of period | 5,324 | 6,055 |
Reconciliation of net income to net cash provided by operating activities: | ||
Net income | 1,339 | 1,681 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 1,423 | 1,370 |
Non-cash restructuring and other special charges | 14 | 14 |
Stock-based compensation expense | 785 | 770 |
Provision for doubtful accounts | 50 | 11 |
Deferred income taxes, net | (39) | (246) |
Excess tax benefits from stock-based compensation | (62) | (85) |
Gain on previously held interests in strategic investments and joint venture | 0 | (45) |
Impairment of strategic investment | 0 | 33 |
Other, net | 22 | 20 |
Changes in assets and liabilities, net of acquisitions: | ||
Accounts and notes receivable | 1,201 | 756 |
Inventories | (99) | (252) |
Other assets | (92) | 169 |
Accounts payable | (537) | (304) |
Accrued expenses | (434) | (234) |
Income taxes payable | (535) | (122) |
Deferred revenue | 450 | 730 |
Other liabilities | 30 | 26 |
Net cash provided by operating activities | (3,516) | (4,292) |
VMware | ||
Cash flows from financing activities: | ||
Repurchase of common stock | (1,050) | (450) |
Proceeds from noncontrolling interests - issuance of common stock and contributions | $ 123 | $ 158 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) shares in Millions, $ in Millions | Total | Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Non-controlling Interests |
Beginning Balance (in shares) at Dec. 31, 2013 | 2,020 | |||||
Beginning Balance at Dec. 31, 2013 | $ 23,786 | $ 20 | $ 1,406 | $ 21,114 | $ (239) | $ 1,485 |
Increase (Decrease) in Shareholders' Equity [Roll Forward] | ||||||
Stock issued through stock option and stock purchase plans (in shares) | 29 | |||||
Stock issued through stock option and stock purchase plans | 445 | $ 0 | 445 | |||
Tax benefit from stock options exercised | 80 | 80 | ||||
Restricted stock grants, cancellations and withholdings, net (in shares) | 9 | |||||
Restricted stock grants, cancellations and withholdings, net | (101) | $ 0 | (101) | |||
Repurchase of common stock (in shares) | (52) | |||||
Repurchase of common stock | (1,374) | (1,374) | ||||
Stock options issued in business acquisitions | 33 | 33 | ||||
Stock-based compensation | 787 | 787 | ||||
Cash dividends declared | (685) | (685) | ||||
Impact from equity transactions of non-controlling interests | (402) | (426) | 24 | |||
Net change in actuarial gain (loss) from pension and other postretirement plans | 1 | 1 | ||||
Change in market value of investments | 88 | 88 | 0 | |||
Change in market value of derivatives | 9 | 9 | ||||
Translation adjustment | (57) | (57) | ||||
Stock Issued During Period Shares Stock Conversion Of Convertible Securities And Warrants | 29 | |||||
Convertible debt conversions and warrant settlement | 0 | 0 | ||||
Net income | 1,681 | 1,568 | 113 | |||
Ending Balance (in shares) at Sep. 30, 2014 | 2,035 | |||||
Ending Balance at Sep. 30, 2014 | $ 24,291 | $ 20 | 850 | 21,997 | (198) | 1,622 |
Beginning Balance (in shares) at Dec. 31, 2014 | 1,985 | 1,985 | ||||
Beginning Balance at Dec. 31, 2014 | $ 23,525 | $ 20 | 0 | 22,242 | (366) | 1,629 |
Increase (Decrease) in Shareholders' Equity [Roll Forward] | ||||||
Stock issued through stock option and stock purchase plans (in shares) | 18 | |||||
Stock issued through stock option and stock purchase plans | 293 | $ 0 | 293 | |||
Tax benefit from stock options exercised | 33 | 33 | ||||
Restricted stock grants, cancellations and withholdings, net (in shares) | 12 | |||||
Restricted stock grants, cancellations and withholdings, net | (137) | $ 0 | (137) | |||
Repurchase of common stock (in shares) | (76) | |||||
Repurchase of common stock | (2,033) | $ (1) | (209) | (1,823) | ||
Stock options issued in business acquisitions | 1 | 1 | ||||
Stock-based compensation | 845 | 845 | ||||
Cash dividends declared | (680) | (680) | ||||
Impact from equity transactions of non-controlling interests | (1,061) | (826) | (235) | |||
Net change in actuarial gain (loss) from pension and other postretirement plans | 0 | |||||
Change in market value of investments | (36) | (34) | (2) | |||
Change in market value of derivatives | 3 | 4 | (1) | |||
Translation adjustment | (137) | (137) | ||||
Net income | $ 1,339 | 1,219 | 120 | |||
Ending Balance (in shares) at Sep. 30, 2015 | 1,939 | 1,939 | ||||
Ending Balance at Sep. 30, 2015 | $ 21,955 | $ 19 | $ 0 | $ 20,958 | $ (533) | $ 1,511 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation 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, Pivotal and Virtustream. 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 and RSA Information Security. The results of Virtustream are currently reported within our Information Storage segment. 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 comprised 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: Pivotal Cloud Foundry, the Pivotal Big Data Suite and Pivotal Labs. Proposed Transaction with Dell On October 12, 2015, EMC entered into an Agreement and Plan of Merger (the “Merger Agreement”) among EMC, Denali Holding Inc., a Delaware corporation (“Parent”), Dell Inc., a Delaware corporation, and Universal Acquisition Co., a Delaware corporation and direct wholly owned subsidiary of Parent (“Merger Sub”), pursuant to which, among other things and subject to the conditions set forth therein, Merger Sub will merge with and into EMC (the “Merger”), with EMC continuing as the surviving corporation and a wholly owned subsidiary of Parent. At the effective time of the Merger (“Effective Time”), each share of EMC common stock issued and outstanding will be canceled and converted into the right to receive (i) $24.05 in cash and (ii) a number of shares of common stock of Parent designated as Class V Common Stock, par value $0.01 per share (the “Class V Common Stock”), equal to the quotient obtained by dividing (A) 222,966,450 by (B) the aggregate number of shares of EMC common stock issued and outstanding immediately prior to the Effective Time. The aggregate number of shares of Class V Common Stock issued as Merger Consideration in the transaction is intended to represent 65% of EMC’s economic interest in the approximately 81% of the outstanding shares of VMware currently owned by the EMC, reflecting approximately 53% of the total economic interest in the outstanding shares of VMware. Upon completion of the transaction, Parent will retain the remaining 28% of the total economic interest in the outstanding shares of VMware. Based on the estimated number of shares of EMC common stock at the closing of the transaction, EMC shareholders are expected to receive approximately 0.111 shares of Class V Common Stock for each share of EMC common stock. Under the terms of the Merger Agreement, EMC may solicit alternative acquisition proposals from third parties until 11:59 p.m. on December 11, 2015. The Merger Agreement contains specified termination rights for both Parent and EMC, including that, in general, either party may terminate if the Merger is not consummated on or before December 16, 2016. If EMC terminates the Merger Agreement, we are required to pay Parent a termination fee of $2.5 billion (or, if EMC terminates for a superior proposal prior to December 12, 2015, the termination fee payable by EMC to Parent will be $2 billion ). If Parent terminates the Merger Agreement, they are required to pay a termination fee of $4 billion under specified circumstances, and in certain instances, an alternative termination fee of $6 billion . The transaction is expected to close in mid-2016. The completion of the Merger is subject to certain conditions including EMC shareholder approval, the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, the receipt of certain other regulatory approvals in various jurisdictions and the effectiveness of the registration statement on Form S-4 to be filed by Parent in connection with the registration of shares of Class V Common Stock issuable in connection with the Merger. The Merger Agreement contains representations and warranties customary for transactions of this nature. EMC has agreed to various customary covenants and agreements, including, among others, agreements to conduct its business in the ordinary course during the period between the execution of the Merger Agreement and the effective time of the Merger. In addition, without the consent of Parent, EMC may not take, authorize, agree or commit to do certain actions outside of the ordinary course of business, including acquiring businesses or incurring capital expenditures above specified thresholds, issuing additional debt facilities and repurchasing outstanding EMC common stock. Under the terms of the Merger Agreement, EMC is required to provide Parent with access to EMC’s cash to help fund the Merger consideration. At this time, EMC has not finalized its plan to access such cash and has not determined if there would be a need to repatriate cash to meet the requirements of the Merger. To date, we have asserted our overseas cash as indefinitely reinvested; however if these overseas funds are required to be repatriated to the U.S. in accordance with the Merger Agreement, we may be required to accrue and pay U.S. taxes to repatriate these funds. Other than transaction expenses associated with the proposed Merger, the terms of the Merger Agreement did not impact EMC’s consolidated financial statements as of and for the three and nine months ended September 30, 2015. General The accompanying interim consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. These consolidated financial statements include the accounts of EMC, its wholly owned subsidiaries, as well as VMware and Pivotal, companies majority-owned by EMC. All intercompany transactions have been eliminated. Certain information and footnote disclosures normally included in our annual consolidated financial statements have been condensed or omitted. Accordingly, these interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2014 which are contained in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 27, 2015. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for any future period or the entire fiscal year. The interim consolidated financial statements, in the opinion of management, reflect all adjustments necessary to fairly state the results as of and for the three - and nine -month periods ended September 30, 2015 and 2014 . Net Income Per Share Basic net income per weighted average share has been computed using the weighted average number of shares of common stock outstanding during the period. Diluted net income per weighted average 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, restricted stock and restricted stock units, and in the three and nine months ended September 30, 2014, the shares issuable under our $1.725 billion 1.75% convertible senior notes due 2013 (the “2013 Notes”) and the associated warrants. Additionally, for purposes of calculating diluted net income per weighted average share, net income is adjusted for the difference between VMware’s reported diluted and basic net income per weighted average share, if any, multiplied by the number of shares of VMware held by EMC. 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. In December 2014, EMC acquired the controlling interest in VCE and, since the date of acquisition, has consolidated VCE’s financial position and results of operations as part of EMC’s consolidated financial statements. Prior to the acquisition of the controlling interest in VCE, we considered VCE a variable interest entity and 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 . Our consolidated share of VCE’s losses, based upon our portion of the overall funding, was approximately 65% and 64% for the three and nine months ended September 30, 2014 , respectively. During the three and nine months ended September 30, 2014 , we recorded $101 million and $261 million , respectively, in net losses from VCE and $207 million and $550 million , respectively, in revenue from sales of product and services to VCE. Reclassifications Certain prior year amounts have been reclassified to conform with the current year’s presentation. In April 2015, the Financial Accounting Standards Board (“FASB”) issued updated guidance to clarify the required presentation of debt issuance costs. The amended guidance requires that debt issuance costs be presented in the balance sheet as a direct reduction from the carrying amount of the related debt liability rather than as an asset. We adopted the guidance during the second quarter of 2015, and accordingly, reclassified the debt issuance costs on our consolidated balance sheets. There was no impact to our consolidated income statements or statements of cash flows. Recent Accounting Pronouncements In September 2015, the FASB issued updated guidance related to simplifying the accounting for measurement period adjustments related to business combinations. The amended guidance eliminates the requirement to retrospectively account for adjustments made during the measurement period. The standard is effective beginning January 1, 2016, with early adoption permitted. We do not expect it to have a material impact on our consolidated financial position, results of operations or cash flows. In April 2015, the FASB issued guidance to customers about whether a cloud computing arrangement includes software and how to account for that software license. The new guidance does not change the accounting for a customer’s accounting for service contracts. The standard is effective beginning January 1, 2017, with early adoption permitted, and may be applied prospectively or retrospectively. We do not expect it to have a material impact on our consolidated financial position, results of operations or cash flows. In May 2014, the 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, as amended, is effective beginning January 1, 2018, with early adoption permitted but not earlier than the original effective date of January 1, 2017. 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. |
Non-controlling Interests
Non-controlling Interests | 9 Months Ended |
Sep. 30, 2015 | |
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 $1,406 million and $1,524 million as of September 30, 2015 and December 31, 2014 , respectively. At September 30, 2015 , EMC held approximately 97% of the combined voting power of VMware’s outstanding common stock and approximately 81% 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 Nine Months Ended September 30, September 30, Net income attributable to EMC Corporation $ 1,219 $ 1,568 Transfers (to) from the non-controlling interests in VMware, Inc.: Increase in EMC Corporation’s additional paid-in-capital for VMware’s equity issuances 60 84 Decrease in EMC Corporation’s additional paid-in-capital for VMware’s other equity activity (886 ) (510 ) Net transfers (to) from non-controlling interest (826 ) (426 ) Change from net income attributable to EMC Corporation and transfers from the non-controlling interest in VMware, Inc. $ 393 $ 1,142 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 September 30, 2015 and December 31, 2014 . At September 30, 2015 , EMC consolidated held approximately 84% of the economic interest in Pivotal. General Electric Company’s (“GE”) 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. |
Business Combinations, Intangib
Business Combinations, Intangibles and Goodwill | 9 Months Ended |
Sep. 30, 2015 | |
Business Combinations [Abstract] | |
Business Combinations, Intangibles and Goodwill | Business Combinations, Intangibles and Goodwill Acquisition of Virtustream On July 9, 2015, EMC acquired all of the outstanding capital stock of Virtustream Group Holdings, Inc. (“Virtustream”), a cloud software and services company that delivers mission-critical enterprise applications in the cloud. This acquisition represents a key element of EMC’s strategy to help customers move applications to cloud-based IT environments. The consideration paid for Virtustream was $1,219 million , net of cash acquired. 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): Current assets $ 18 Property, plant and equipment, net 14 Intangible assets: Purchased technology (weighted-average useful life of 8.6 years) 302 Customer relationships and customer lists (weighted-average useful life of 12.3 years) 50 Trademarks and tradenames (weighted-average useful life of 7.6 years) 27 Total intangible assets, net, excluding goodwill 379 Goodwill 891 Other assets, net 12 Total assets acquired 1,314 Current liabilities (27 ) Deferred income taxes (61 ) Other liabilities (7 ) Total net liabilities assumed (95 ) Fair value of assets acquired and net liabilities assumed $ 1,219 The total weighted-average amortization period for the intangible assets is 9.0 years. The intangible assets are being amortized over the pattern in which the economic benefits of the intangible assets are being utilized, which in general reflects the cash flows generated from such assets. Goodwill is calculated as the excess of the consideration over the fair value of the net assets, including intangible assets, recognized and is primarily related to expected synergies from the transaction, including complementary products that will enhance our overall product portfolio, which we believe will result in incremental revenue and profitability. The goodwill associated with this acquisition is currently reported within our Information Storage segment. None of the goodwill is deductible for 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 nine months ended September 30, 2015 or 2014 . Other Acquisitions During the nine months ended September 30, 2015 , EMC acquired five businesses, excluding Virtustream, which were not material either individually or in the aggregate to our September 30, 2015 results. Complementing the Information Storage segment, we acquired all of the outstanding capital stock of Renasar Technologies, Inc., a provider of extensible physical middleware, CloudLink, a provider of cloud data security software and Graphite Systems, a developer of server-side flash storage. Complementing our Pivotal segment, we acquired all of the outstanding capital stock of Quickstep Technologies, LLC, a query execution technology developer. VMware acquired all of the outstanding capital stock of Immidio B.V. The aggregate consideration for these five acquisitions was $89 million which represents cash consideration, net of cash acquired in the third quarter of 2015 . 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 $64 million , $33 million and $8 million , respectively. The intangible assets acquired were primarily comprised of purchased developed technology which have a weighted-average amortization period of 3.6 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 three and nine months ended September 30, 2015 or 2014 . Intangible Assets Intangible assets, excluding goodwill, as of September 30, 2015 and December 31, 2014 consist of (tables in millions): September 30, 2015 Gross Carrying Amount Accumulated Amortization Net Book Value Purchased technology $ 3,266 $ (1,845 ) $ 1,421 Patents 225 (128 ) 97 Software licenses 111 (94 ) 17 Trademarks and tradenames 253 (151 ) 102 Customer relationships and customer lists 1,523 (1,060 ) 463 Leasehold interest 152 (19 ) 133 Other 46 (40 ) 6 Total intangible assets, excluding goodwill $ 5,576 $ (3,337 ) $ 2,239 December 31, 2014 Gross Carrying Amount Accumulated Amortization Net Book Value 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 Goodwill Changes in the carrying amount of goodwill, net, on a consolidated basis and by segment, for the nine months ended September 30, 2015 consist of (table in millions): Nine Months Ended September 30, 2015 Information Storage Enterprise Content Division RSA Information Security Pivotal VMware Virtual Infrastructure Total Balance, beginning of the period $ 8,266 $ 1,486 $ 2,203 $ 171 $ 4,008 $ 16,134 Goodwill resulting from acquisitions 935 — — 3 17 955 Finalization of purchase price allocations and other, net 2 (8 ) — — — (6 ) Balance, end of the period $ 9,203 $ 1,478 $ 2,203 $ 174 $ 4,025 $ 17,083 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Debt | Debt Short-Term Debt 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. As of September 30, 2015 , we were in compliance with customary required covenants and we had not borrowed any funds under the credit facility. At November 6, 2015, we had $600 million borrowed under the credit facility. On March 23, 2015, we established a short-term debt financing program whereby we may issue short-term unsecured commercial paper notes (“Commercial Paper”). Amounts available under the program may be borrowed, repaid and re-borrowed from time to time, with the aggregate face or principal amount of the notes outstanding at any time not to exceed $2.5 billion . The Commercial Paper will have maturities of up to 397 days from the date of issue . The net proceeds from the issuance of the Commercial Paper are expected to be used for general corporate purposes. As of September 30, 2015 , we were in compliance with customary required covenants. At September 30, 2015 , we had $1,970 million of Commercial Paper outstanding, with a weighted-average interest rate of 0.24% and maturities ranging from 34 days to 80 days at the time of issuance. Commercial Paper outstanding is presented in short-term debt in the consolidated balance sheets, and the issuances and proceeds of the Commercial Paper are presented on a net basis in the consolidated statement of cash flows due to their short term nature. At November 6, 2015, we had $1,565 million of Commercial Paper outstanding. 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 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, business acquisitions, dividend payments, 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 September 30, 2015 , we were in compliance with all debt covenants, which are customary in nature. Our long-term debt as of September 30, 2015 was as follows (dollars in millions): Senior Notes Issued at Discount to Par Carrying Value $2.5 billion 1.875% Notes due 2018 99.943 % $ 2,499 $2.0 billion 2.650% Notes due 2020 99.760 % 1,996 $1.0 billion 3.375% Notes due 2023 99.925 % 1,000 $ 5,495 Debt issuance costs (21 ) Net long-term debt $ 5,474 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 2.55% for both the three and nine months ended September 30, 2015 . Convertible Debt In November 2006, we issued the 2013 Notes. These 2013 Notes matured and a majority of the noteholders exercised their right to convert the outstanding 2013 Notes as of December 31, 2013. Pursuant to the settlement terms, the majority of the converted 2013 Notes were settled on 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 in excess of the conversion value over the principal amount, as prescribed by 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. In connection with the issuance of the 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 2013 Notes upon conversion. We exercised 108 million of the purchased options in conjunction with the planned settlements of the 2013 Notes and 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. In 2012, the interest rate swap contracts were settled and accumulated losses 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 the ten year Notes. During the three and nine months ended September 30, 2015 , $6 million and $17 million , respectively, 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 | 9 Months Ended |
Sep. 30, 2015 | |
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 September 30, 2015 , 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 September 30, 2015 and December 31, 2014 . At September 30, 2015 and December 31, 2014 , 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 September 30, 2015 and December 31, 2014 , 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 September 30, 2015 and December 31, 2014 (tables in millions): September 30, 2015 Amortized Cost Unrealized Gains Unrealized (Losses) Aggregate Fair Value U.S. government and agency obligations $ 2,376 $ 5 $ (1 ) $ 2,380 U.S. corporate debt securities 2,549 4 (5 ) 2,548 High yield corporate debt securities 370 2 (22 ) 350 Asset-backed securities 30 — — 30 Municipal obligations 850 2 — 852 Auction rate securities 27 — (2 ) 25 Foreign debt securities 2,559 3 (8 ) 2,554 Total fixed income securities 8,761 16 (38 ) 8,739 Publicly traded equity securities 178 52 (9 ) 221 Total $ 8,939 $ 68 $ (47 ) $ 8,960 December 31, 2014 Amortized Cost Unrealized Gains Unrealized (Losses) Aggregate 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 We held approximately $2,554 million in foreign debt securities at September 30, 2015 . These securities have an average credit rating of A+ , and approximately 4% 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, Cyprus or Puerto Rico. The following tables represent our fair value hierarchy for our financial assets and liabilities measured at fair value as of September 30, 2015 and December 31, 2014 (tables in millions): September 30, 2015 Level 1 Level 2 Level 3 Total Cash $ 1,643 $ — $ — $ 1,643 Cash equivalents 3,264 417 — 3,681 U.S. government and agency obligations 1,404 976 — 2,380 U.S. corporate debt securities — 2,548 — 2,548 High yield corporate debt securities — 350 — 350 Asset-backed securities — 30 — 30 Municipal obligations — 852 — 852 Auction rate securities — — 25 25 Foreign debt securities — 2,554 — 2,554 Publicly traded equity securities 221 — — 221 Total cash and investments $ 6,532 $ 7,727 $ 25 $ 14,284 Other items: Strategic investments held at cost $ — $ — $ 382 $ 382 Investment in joint venture — — 38 38 Long-term debt carried at discounted cost — (5,514 ) — (5,514 ) Foreign exchange derivative assets — 49 — 49 Foreign exchange derivative liabilities — (47 ) — (47 ) Commodity derivative liabilities — (4 ) — (4 ) 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 held at cost $ — $ — $ 333 $ 333 Investment in joint venture — — 37 37 Long-term debt carried at discounted cost — (5,544 ) — (5,544 ) Foreign exchange derivative assets — 44 — 44 Foreign exchange derivative liabilities — (71 ) — (71 ) Commodity derivative assets — 12 — 12 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 $6 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 use a discounted cash flow model using a five year time horizon. As of September 30, 2015 , the coupon rates used ranged from 0% to 2% 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 September 30, 2015 . 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 September 30, 2015 and December 31, 2014 due to the narrowing of credit spreads on AA -rated banks during 2014 and into 2015. 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 three and nine months ended September 30, 2015 and 2014 , there were no material changes to the fair value 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 third quarter of 2015 and there were no material changes to the fair value of this joint venture during the three and nine months ended September 30, 2015 and 2014 . The carrying value of the strategic investments held 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 held at cost using the most currently available information. To determine the estimated fair value of private strategic investments held 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 September 30, 2015 by investment category and length of time the investment has been in a continuous unrealized loss position are as follows (table in millions): Less Than 12 Months 12 Months or Greater Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses U.S. government and agency obligations $ 321 $ (1 ) $ — $ — $ 321 $ (1 ) U.S. corporate debt securities 1,103 (5 ) — — 1,103 (5 ) High yield corporate debt securities 239 (17 ) 30 (5 ) 269 (22 ) Auction rate securities — — 25 (2 ) 25 (2 ) Foreign debt securities 1,220 (8 ) — — 1,220 (8 ) Publicly traded equity securities 2 (1 ) 19 (8 ) 21 (9 ) Total $ 2,885 $ (32 ) $ 74 $ (15 ) $ 2,959 $ (47 ) For all of our securities for which the amortized cost basis was greater than the fair value at September 30, 2015 , 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. Contractual Maturities The contractual maturities of fixed income securities held at September 30, 2015 are as follows (table in millions): September 30, 2015 Amortized Cost Basis Aggregate Fair Value Due within one year $ 2,302 $ 2,303 Due after 1 year through 5 years 5,618 5,617 Due after 5 years through 10 years 523 503 Due after 10 years 318 316 Total $ 8,761 $ 8,739 Short-term investments on the consolidated balance sheet include $15 million in variable rate notes which have contractual maturities in 2015 , and are not classified within investments due within one year above. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of (table in millions): September 30, December 31, Work-in-process $ 580 $ 627 Finished goods 644 649 $ 1,224 $ 1,276 |
Accounts and Notes Receivable a
Accounts and Notes Receivable and Allowance for Credit Losses | 9 Months Ended |
Sep. 30, 2015 | |
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 September 30, 2015 were as follows (table in millions): Year Contractual Amounts Due Under Leases Due within one year $ 65 Due within two years 45 Due within three years 31 Thereafter 1 Total 142 Less: Amounts representing interest 5 Present value 137 Current portion (included in accounts and notes receivable) 62 Long-term portion (included in other assets, net) $ 75 Subsequent to September 30, 2015 , we sold $23 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 credit scores 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 September 30, 2015 , amounts from lease receivables past due for more than 90 days were not significant. During the three and nine months ended September 30, 2015 and 2014 , there were no material changes to our allowance for credit losses related to lease receivables. Gross lease receivables totaled $142 million and $233 million as of September 30, 2015 and December 31, 2014 , respectively, before the allowance. The components of these balances were individually evaluated for impairment and included in our allowance determination as necessary. |
Property, Plant and Equipment
Property, Plant and Equipment | 9 Months Ended |
Sep. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment consist of (table in millions): September 30, December 31, Furniture and fixtures $ 280 $ 255 Equipment and software 7,305 6,684 Buildings and improvements 2,357 2,308 Land 170 162 Building construction in progress 68 134 10,180 9,543 Accumulated depreciation (6,389 ) (5,777 ) $ 3,791 $ 3,766 Building construction in progress at September 30, 2015 includes $39 million for facilities not yet placed in service that we are holding for future use. |
Accrued Expenses
Accrued Expenses | 9 Months Ended |
Sep. 30, 2015 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | Accrued Expenses Accrued expenses consist of (table in millions): September 30, December 31, Salaries and benefits $ 1,075 $ 1,251 Product warranties 180 207 Dividends payable (see Note 11) 232 237 Partner rebates 204 235 Restructuring, current (See Note 12) 162 123 Derivatives 51 75 Other 927 1,013 $ 2,831 $ 3,141 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 three and nine months ended September 30, 2015 and 2014 (table in millions): For the Three Months Ended For the Nine Months Ended September 30, September 30, September 30, September 30, Balance, beginning of the period $ 189 $ 254 $ 207 $ 286 Provision 32 32 109 107 Amounts charged against the accrual (41 ) (59 ) (136 ) (166 ) Balance, end of the period $ 180 $ 227 $ 180 $ 227 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 | 9 Months Ended |
Sep. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Our effective income tax rates were 24.1% and 23.9% for the three and nine months ended September 30, 2015 , respectively. Our effective income tax rates were 24.7% and 24.0% for the three and nine months ended September 30, 2014 , respectively. Our effective income tax rate is based upon estimated income before provision for income taxes for the year, composition of the income in different countries, and adjustments, if any, in the applicable quarterly periods for potential tax consequences, benefits and/or resolutions of tax audits or other tax contingencies. For the three and nine months ended September 30, 2015, the effective income tax rate varied from the statutory income tax rate principally as a result of the mix of income attributable to foreign versus domestic jurisdictions and state taxes. Our aggregate income tax rate in foreign jurisdictions is lower than our income tax rate in the United States; substantially all of our income before provision for income taxes from foreign operations has been earned by our Irish subsidiaries. For the three and nine months ended September 30, 2014, the effective income tax rate varied from the statutory income tax rate principally as a result of the mix of income attributable to foreign versus domestic jurisdictions and state taxes. 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 effective income tax rates for the three and nine months ended September 30, 2015 and 2014 do not reflect any federal tax credit for increasing research activities. Our effective income tax rate decreased in the three months ended September 30, 2015 from the three months ended September 30, 2014 due primarily to a decrease in tax contingency reserves and lower state taxes partially offset by a lower tax rate differential for international jurisdictions. There were also differences in discrete items, the net impact of which is immaterial. Our effective income tax rate for the nine months ended September 30, 2015 was consistent with our effective income tax rate for the nine months ended September 30, 2014. 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. In the third quarter of 2012, the IRS commenced a federal income tax audit for the tax years 2009 and 2010, which is expected to be completed in late 2015. In the first quarter of 2015, the IRS commenced a federal income tax audit for the tax year 2011, which is still in the early stage for information gathering. 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 consolidated balance sheets. 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 consolidated results of operations or financial position. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Equity | Shareholders’ Equity The reconciliation from basic to diluted earnings per share for both the numerators and denominators is as follows (table in millions): For the Three Months Ended For the Nine Months Ended September 30, September 30, September 30, September 30, Numerator: Net income attributable to EMC Corporation $ 480 $ 587 $ 1,219 $ 1,568 Incremental dilution from VMware (1 ) (1 ) (3 ) (4 ) Net income – dilution attributable to EMC Corporation $ 479 $ 586 $ 1,216 $ 1,564 Denominator: Weighted average shares, basic 1,934 2,032 1,945 2,033 Weighted common stock equivalents 14 25 18 26 Assumed conversion of the 2013 Notes and associated warrants — — — 6 Weighted average shares, diluted 1,948 2,057 1,963 2,065 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 in 2012 and 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 nine months ended September 30, 2014 . Restricted stock awards, restricted stock units and options to acquire shares of our common stock in the amount of 19 million and 7 million for the three and nine months ended September 30, 2015 , respectively, and 3 million for the nine months ended September 30, 2014 , were excluded from the calculation of diluted earnings per share because they were anti-dilutive. There were minimal antidilutive restricted stock awards, restricted stock units and options to acquire shares of our common stock excluded from the calculation of diluted earnings per share for the three months ended September 30, 2014. 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. Repurchase 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 nine months ended September 30, 2015 , we spent $2.0 billion to repurchase 76 million shares of our common stock. Of the 500 million shares authorized for repurchase, we have repurchased 277 million shares at a total cost of $7.4 billion , leaving a remaining balance of 223 million shares authorized for future repurchases. VMware’s Board of Directors authorized the repurchase of $1.0 billion of VMware’s Class A common stock in January 2015. All shares repurchased under VMware’s stock repurchase programs are retired. For the nine months ended September 30, 2015 , VMware spent $1,050 million to repurchase 13 million shares of their common stock. Of the $1.0 billion authorized for repurchase, VMware has a remaining balance of $910 million authorized for future repurchases. 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 and in April 2014, our Board of Directors increased the dividend to $0.115 per share of common stock. Our Board of Directors declared the following dividends during 2015 and 2014 : Declaration Date Dividend Per Share Record Date Total Amount (in millions) Payment Date 2015: February 27, 2015 $ 0.115 April 1, 2015 $ 229 April 23, 2015 May 20, 2015 $ 0.115 July 1, 2015 $ 226 July 23, 2015 July 30, 2015 $ 0.115 October 1, 2015 $ 229 October 23, 2015 2014: February 6, 2014 $ 0.10 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 December 9, 2014 $ 0.115 January 2, 2015 $ 234 January 23, 2015 Accumulated Other Comprehensive Income (Loss) Changes in accumulated other comprehensive income (loss), which is presented net of tax, for the nine months ended September 30, 2015 and 2014 consist of the following (tables 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 December, 31 2014 (a) $ (187 ) $ 49 $ (99 ) $ (126 ) $ (3 ) $ (366 ) Other comprehensive income (loss) before reclassifications (137 ) (10 ) 11 — 3 (133 ) Net losses (gains) reclassified from accumulated other comprehensive income — (26 ) (8 ) — — (34 ) Net current period other comprehensive income (loss) (137 ) (36 ) 3 — 3 (167 ) Balance as of September 30, 2015 (b) $ (324 ) $ 13 $ (96 ) $ (126 ) $ — $ (533 ) __________________ (a) 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. (b) Net of taxes (benefits) of $8 million for unrealized net gains on investments, $(58) million for unrealized net losses on derivatives and $(70) million for actuarial net loss on pension plans . 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 December, 31 2013 (a) $ (53 ) $ 31 $ (106 ) $ (110 ) $ (1 ) $ (239 ) Other comprehensive income (loss) before reclassifications (57 ) 107 11 2 — 63 Net losses (gains) reclassified from accumulated other comprehensive income — (19 ) (2 ) (1 ) — (22 ) Net current period other comprehensive income (loss) (57 ) 88 9 1 — 41 Balance as of September 30, 2014 (b) $ (110 ) $ 119 $ (97 ) $ (109 ) $ (1 ) $ (198 ) __________________ (a) 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. (b) Net of taxes (benefits) of $72 million for unrealized net gains on investments, $(63) million for unrealized net losses on derivatives and $(61) million for actuarial net loss on pension plans. The amounts reclassified out of accumulated other comprehensive income (loss) for the three and nine months ended September 30, 2015 and 2014 are as follows (tables in millions): For the Three Months Ended Accumulated Other Comprehensive Income Components September 30, 2015 September 30, 2014 Impacted Line Item on Consolidated Income Statements Net gain on investments: $ 8 $ 13 Investment income (3 ) (5 ) Provision for income tax Net of tax $ 5 $ 8 Net gain on derivatives: Foreign exchange contracts $ 1 $ 12 Product sales revenue Foreign exchange contracts — (7 ) Cost of product sales Interest rate swap (6 ) (6 ) Other interest expense Total net gain (loss) on derivatives before tax (5 ) (1 ) 2 — Provision for income tax Net of tax $ (3 ) $ (1 ) Net gain from pension and other postretirement plans $ — $ 1 Selling, general and administrative expense — — Provision for income tax Net of tax $ — $ 1 For the Nine Months Ended Accumulated Other Comprehensive Income Components September 30, 2015 September 30, 2014 Impacted Line Item on Consolidated Income Statements Net gain on investments: $ 42 $ 30 Investment income (16 ) (11 ) Provision for income tax Net of tax $ 26 $ 19 Net gain on derivatives: Foreign exchange contracts $ 22 $ 15 Product sales revenue Foreign exchange contracts (1 ) (7 ) Cost of product sales Interest rate swap (17 ) (6 ) Other interest expense Total net gain on derivatives before tax 4 2 4 — Provision for income tax Net of tax $ 8 $ 2 Net gain from pension and other postretirement plans $ — $ 1 Selling, general and administrative expense — — Provision for income tax Net of tax $ — $ 1 |
Restructuring and Acquisition-R
Restructuring and Acquisition-Related Charges | 9 Months Ended |
Sep. 30, 2015 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Acquisition-Related Charges | Restructuring and Acquisition-Related Charges For the three and nine months ended September 30, 2015 , we incurred restructuring and acquisition-related charges of $68 million and $226 million , respectively. For the three and nine months ended September 30, 2014 , we incurred restructuring and acquisition-related charges of $39 million and $187 million , respectively. For the three and nine months ended September 30, 2015 , EMC incurred $66 million and $200 million , respectively, of restructuring charges, primarily related to our current year restructuring programs, and $1 million and $4 million , respectively, of charges in connection with acquisitions for financial, advisory, legal and accounting services. For the nine months ended September 30, 2015 , VMware incurred $20 million of restructuring charges, primarily related to its current year restructuring program. For the three and nine months ended September 30, 2015 , VMware incurred $1 million and $2 million , respectively, of charges in connection with acquisitions for financial, advisory, legal and accounting services. For the three and nine months ended September 30, 2014 , EMC incurred $31 million and $175 million , respectively, of restructuring charges, primarily related to our 2014 restructuring programs, and during the three and nine months ended September 30, 2014 , EMC incurred $2 million and $3 million , respectively, of charges in connection with acquisitions for financial, advisory, legal and accounting services. For the three and nine months ended September 30, 2014 , VMware incurred $6 million and $4 million , respectively, of restructuring charges, primarily related to its 2014 restructuring programs. For the nine months ended September 30, 2014 , VMware incurred $5 million of charges in connection with acquisitions for financial, advisory, legal and accounting services. In the first, second and third quarters of 2015 , EMC implemented restructuring programs to create further operational efficiencies which will result in workforce reductions of approximately 1,320 , 160 and 680 positions, respectively. The actions will 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 within a year of the start of the program. During 2014 , EMC implemented restructuring programs to create further operational efficiencies which resulted in a workforce reduction of approximately 2,100 positions, of which 1,320 , 210 and 240 positions were identified in the first, second and third quarters of 2014 , respectively. The actions impacted positions around the globe covering our Information Storage, RSA Information Security and Enterprise Content Division segments. All of these actions were completed within a year of the start of the program. In the first quarter of 2015 , VMware eliminated approximately 350 positions across all major functional groups and geographies to streamline its operations. All of these actions are expected to be completed within a year of the start of the program. During the third quarter of 2014, VMware eliminated approximately 90 positions across all major functional groups and geographies to streamline its operations. For the three and nine months ended September 30, 2015 , we recognized $5 million and $22 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. For the three and nine months ended September 30, 2014 , we recognized $2 million and $10 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 activity for the restructuring programs is presented below (tables in millions): Three Months Ended September 30, 2015 : 2015 EMC Programs Category Balance as of June 30, 2015 2015 Charges Utilization Balance as of September 30, 2015 Workforce reductions $ 89 $ 62 $ (33 ) $ 118 Consolidation of excess facilities and other contractual obligations 12 6 (3 ) 15 Total $ 101 $ 68 $ (36 ) $ 133 Other EMC Programs Category Balance as of Adjustments to the Provision Utilization Balance as of September 30, 2015 Workforce reductions $ 43 $ (1 ) $ (14 ) $ 28 Consolidation of excess facilities and other contractual obligations 13 (1 ) (1 ) 11 Total $ 56 $ (2 ) $ (15 ) $ 39 Nine Months Ended September 30, 2015 : 2015 EMC Programs Category Balance as of December 31, 2014 2015 Charges Utilization Balance as of September 30, 2015 Workforce reductions $ — $ 185 $ (67 ) $ 118 Consolidation of excess facilities and other contractual obligations — 23 (8 ) 15 Total $ — $ 208 $ (75 ) $ 133 Other EMC Programs Category Balance as of Adjustments to the Provision Utilization Balance as of September 30, 2015 Workforce reductions $ 102 $ (7 ) $ (67 ) $ 28 Consolidation of excess facilities and other contractual obligations 19 (1 ) (7 ) 11 Total $ 121 $ (8 ) $ (74 ) $ 39 VMware Programs Category Balance as of 2015 Charges Utilization Balance as of September 30, 2015 Workforce reductions $ 8 $ 20 $ (27 ) $ 1 Consolidation of excess facilities and other contractual obligations — — — — Total $ 8 $ 20 $ (27 ) $ 1 Three Months Ended September 30, 2014 : 2014 EMC Programs Category Balance as of 2014 Charges Utilization Balance as of September 30, 2014 Workforce reductions $ 98 $ 30 $ (33 ) $ 95 Consolidation of excess facilities and other contractual obligations 3 2 (2 ) 3 Total $ 101 $ 32 $ (35 ) $ 98 Other EMC Programs Category Balance as of Adjustments to the Provision Utilization Balance as of September 30, 2014 Workforce reductions $ 17 $ (1 ) $ (6 ) $ 10 Consolidation of excess facilities and other contractual obligations 18 — (1 ) 17 Total $ 35 $ (1 ) $ (7 ) $ 27 Nine Months Ended September 30, 2014: 2014 EMC Programs Category Balance as of 2014 Charges Utilization Balance as of September 30, 2014 Workforce reductions $ — $ 179 $ (84 ) $ 95 Consolidation of excess facilities and other contractual obligations — 7 (4 ) 3 Total $ — $ 186 $ (88 ) $ 98 Other EMC Programs Category Balance as of Adjustments to the Provision Utilization Balance as of September 30, 2014 Workforce reductions $ 66 $ (14 ) $ (42 ) $ 10 Consolidation of excess facilities and other contractual obligations 24 3 (10 ) 17 Total $ 90 $ (11 ) $ (52 ) $ 27 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies 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. During the second quarter of 2015, VMware reached an agreement with the Department of Justice (“DOJ”) and the General Services Administration (“GSA”) to pay $76 million to resolve allegations that VMware’s government sales practices between 2006 and 2013 had violated the federal False Claims Act. The settlement was paid and recorded as a reduction of VMware’s product revenues during the nine months ended September 30, 2015. As of November 6, 2015, eleven lawsuits challenging the Merger have been filed purportedly on behalf of Company shareholders, of which eight were filed (or are now pending) in the Business Litigation Session of the Suffolk County Superior Court in Massachusetts, one was filed in the Middlesex County Superior Court in Massachusetts, and two were filed in the United States District Court for the District of Massachusetts. All of the lawsuits are purported shareholder class actions advancing substantially the same allegations that the Merger Agreement was adopted in violation of the fiduciary duties of the Company’s directors and seeking injunctive relief to enjoin the merger, as well as other remedies. Certain of the lawsuits also allege that the Company, Denali Holding Inc., Dell Inc., Universal Acquisition Co., Silver Lake Partners, LLC, and/or MSD Partners, LLC aided and abetted the alleged breaches of fiduciary duty by the directors. On October 23, 2015, the Company and its directors served a motion to consolidate all of the lawsuits then pending in state court in Massachusetts with and into the first-filed of those actions, IBEW Local No. 129 Benefit Fund v. Joseph M. Tucci, et al . That action names as defendants the Company and each member of its Board of Directors (as constituted as of October 12, 2015), Denali Holding Inc., Dell Inc., and Universal Acquisition Co. On October 27, 2015, the Company and its directors served a motion to dismiss the amended complaint in the IBEW matter pursuant to provisions of the Massachusetts Business Corporation Act, M.G.L. c. 156D, § 7.40 et seq. , and Rules 12(b)(6) and 23.1 of the Massachusetts Rules of Civil Procedure, on the basis that the complaint asserts a derivative action on behalf of the Company and should be dismissed for failure to make the requisite pre-suit demand on the Company. On November 5, 2015, the Company and its directors filed motions (i) to stay or dismiss the actions pending in the United States District Court for the District of Massachusetts on the ground that those actions are duplicative of the actions pending in state court in Massachusetts; and (ii) to dismiss those same actions pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure on the ground that the complaints in those actions fail to allege a basis for the federal court’s subject matter jurisdiction. No defendant has yet filed a responsive pleading in the other lawsuits. The outcome of these lawsuits is uncertain, and additional lawsuits may be brought or additional claims advanced concerning the Merger. An adverse judgment for monetary damages could have an adverse effect on the Company’s operations. A preliminary injunction could delay or jeopardize the completion of the Merger, and an adverse judgment granting permanent injunctive relief could indefinitely enjoin completion of the Merger. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information We manage the Company as a federation of businesses: EMC Information Infrastructure, VMware Virtual Infrastructure, Pivotal and Virtustream. EMC Information Infrastructure operates in three segments: Information Storage, Enterprise Content Division and RSA Information Security, while VMware Virtual Infrastructure and Pivotal each operate as single segments. The results of Virtustream are currently reported within our Information Storage segment. 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, intangible asset amortization expense, restructuring charges and acquisition and other related charges. Additionally, in certain instances, infrequently occurring items are also excluded or included 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 three and nine months ended September 30, 2015 and 2014 is as follows (tables in millions, except percentages): EMC Information Infrastructure Information Storage Enterprise Content Division RSA Information Security EMC Information Infrastructure Pivotal EMC Information Infrastructure plus Pivotal Three Months Ended September 30, 2015 Revenues: Product revenues $ 2,424 $ 37 $ 106 $ 2,567 $ 22 $ 2,589 Services revenues 1,537 107 137 1,781 45 1,826 Total consolidated revenues 3,961 144 243 4,348 67 4,415 Gross profit $ 2,071 $ 97 $ 163 $ 2,331 $ 24 $ 2,355 Gross profit percentage 52.3 % 67.3 % 66.9 % 53.6 % 36.2 % 53.3 % Research and development 397 28 425 Selling, general and administrative 1,220 54 1,274 Restructuring and acquisition-related charges — — — Total operating expenses 1,617 82 1,699 Operating income (expense) $ 714 $ (58 ) $ 656 EMC Information Infrastructure plus Pivotal VMware Virtual Infrastructure Corp Reconciling Items Consolidated Three Months Ended September 30, 2015 Revenues: Product revenues $ 2,589 $ 680 $ — $ 3,269 Services revenues 1,826 984 — 2,810 Total consolidated revenues 4,415 1,664 — 6,079 Gross profit $ 2,355 $ 1,451 $ (101 ) $ 3,705 Gross profit percentage 53.3 % 87.2 % — % 60.9 % Research and development 425 274 103 802 Selling, general and administrative 1,274 651 220 2,145 Restructuring and acquisition-related charges — — 68 68 Total operating expenses 1,699 925 391 3,015 Operating income (expense) 656 526 (492 ) 690 Non-operating income (expense), net 2 4 — 6 Income tax provision (benefit) 185 89 (106 ) 168 Net income 473 441 (386 ) 528 Net income attributable to the non-controlling interest in VMware, Inc. — (77 ) 29 (48 ) Net income attributable to EMC Corporation $ 473 $ 364 $ (357 ) $ 480 EMC Information Infrastructure Information Storage Enterprise Content Division RSA Information Security EMC Information Infrastructure Pivotal EMC Information Infrastructure plus Pivotal Three Months Ended September 30, 2014 Revenues: Product revenues $ 2,595 $ 36 $ 114 $ 2,745 $ 17 $ 2,762 Services revenues 1,456 118 147 1,721 41 1,762 Total consolidated revenues 4,051 154 261 4,466 58 4,524 Gross profit $ 2,238 $ 100 $ 173 $ 2,511 $ 27 $ 2,538 Gross profit percentage 55.2 % 65.2 % 66.3 % 56.2 % 46.9 % 56.1 % Research and development 372 33 405 Selling, general and administrative 1,146 46 1,192 Restructuring and acquisition-related charges — — — Total operating expenses 1,518 79 1,597 Operating income (expense) $ 993 $ (52 ) $ 941 EMC Information Infrastructure plus Pivotal VMware Virtual Infrastructure Corp Reconciling Items Consolidated Three Months Ended September 30, 2014 Revenues: Product revenues $ 2,762 $ 638 $ — $ 3,400 Services revenues 1,762 870 — 2,632 Total consolidated revenues 4,524 1,508 — 6,032 Gross profit $ 2,538 $ 1,304 $ (99 ) $ 3,743 Gross profit percentage 56.1 % 86.5 % — % 62.0 % Research and development 405 263 99 767 Selling, general and administrative 1,192 586 212 1,990 Restructuring and acquisition-related charges — — 39 39 Total operating expenses 1,597 849 350 2,796 Operating income (expense) 941 455 (449 ) 947 Non-operating income (expense), net (120 ) 6 — (114 ) Income tax provision (benefit) 207 99 (100 ) 206 Net income 614 362 (349 ) 627 Net income attributable to the non-controlling interest in VMware, Inc. — (73 ) 33 (40 ) Net income attributable to EMC Corporation $ 614 $ 289 $ (316 ) $ 587 EMC Information Infrastructure Information Storage Enterprise Content Division RSA Information Security EMC Information Infrastructure Pivotal EMC Information Infrastructure plus Pivotal Nine Months Ended September 30, 2015 Revenues: Product revenues $ 7,113 $ 103 $ 303 $ 7,519 $ 57 $ 7,576 Services revenues 4,539 333 427 5,299 128 5,427 Total consolidated revenues 11,652 436 730 12,818 185 13,003 Gross profit $ 6,014 $ 291 $ 487 $ 6,792 $ 71 $ 6,863 Gross profit percentage 51.6 % 66.8 % 66.7 % 53.0 % 38.7 % 52.8 % Research and development 1,219 79 1,298 Selling, general and administrative 3,591 156 3,747 Restructuring and acquisition-related charges — — — Total operating expenses 4,810 235 5,045 Operating income (expense) $ 1,982 $ (164 ) $ 1,818 EMC Information Infrastructure plus Pivotal VMware Virtual Infrastructure Corp Reconciling Items Consolidated Nine Months Ended September 30, 2015 Revenues: Product revenues $ 7,576 $ 1,899 $ (76 ) $ 9,399 Services revenues 5,427 2,863 — 8,290 Total consolidated revenues 13,003 4,762 (76 ) 17,689 Gross profit $ 6,863 $ 4,143 $ (375 ) $ 10,631 Gross profit percentage 52.8 % 87.0 % — % 60.1 % Research and development 1,298 788 286 2,372 Selling, general and administrative 3,747 1,896 642 6,285 Restructuring and acquisition-related charges — — 226 226 Total operating expenses 5,045 2,684 1,154 8,883 Operating income (expense) 1,818 1,459 (1,529 ) 1,748 Non-operating income (expense), net 7 24 (20 ) 11 Income tax provision (benefit) 494 285 (359 ) 420 Net income 1,331 1,198 (1,190 ) 1,339 Net income attributable to the non-controlling interest in VMware, Inc. — (224 ) 104 (120 ) Net income attributable to EMC Corporation $ 1,331 $ 974 $ (1,086 ) $ 1,219 EMC Information Infrastructure Information Storage Enterprise Content Division RSA Information Security EMC Information Infrastructure Pivotal EMC Information Infrastructure plus Pivotal Nine Months Ended September 30, 2014 Revenues: Product revenues $ 7,447 $ 108 $ 323 $ 7,878 $ 43 $ 7,921 Services revenues 4,260 358 425 5,043 118 5,161 Total consolidated revenues 11,707 466 748 12,921 161 13,082 Gross profit $ 6,405 $ 300 $ 497 $ 7,202 $ 71 $ 7,273 Gross profit percentage 54.7 % 64.4 % 66.4 % 55.7 % 44.3 % 55.6 % Research and development 1,106 98 1,204 Selling, general and administrative 3,388 133 3,521 Restructuring and acquisition-related charges — — — Total operating expenses 4,494 231 4,725 Operating income (expense) $ 2,708 $ (160 ) $ 2,548 EMC Information Infrastructure plus Pivotal VMware Virtual Infrastructure Corp Reconciling Items Consolidated Nine Months Ended September 30, 2014 Revenues: Product revenues $ 7,921 $ 1,807 $ — $ 9,728 Services revenues 5,161 2,502 — 7,663 Total consolidated revenues 13,082 4,309 — 17,391 Gross profit $ 7,273 $ 3,761 $ (290 ) $ 10,744 Gross profit percentage 55.6 % 87.3 % — % 61.8 % Research and development 1,204 737 298 2,239 Selling, general and administrative 3,521 1,725 606 5,852 Restructuring and acquisition-related charges — — 187 187 Total operating expenses 4,725 2,462 1,091 8,278 Operating income (expense) 2,548 1,299 (1,381 ) 2,466 Non-operating income (expense), net (285 ) 21 11 (253 ) Income tax provision (benefit) 584 274 (326 ) 532 Net income 1,679 1,046 (1,044 ) 1,681 Net income attributable to the non-controlling interest in VMware, Inc. — (211 ) 98 (113 ) Net income attributable to EMC Corporation $ 1,679 $ 835 $ (946 ) $ 1,568 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): For the Three Months Ended For the Nine Months Ended September 30, September 30, September 30, September 30, United States $ 3,318 $ 3,212 $ 9,602 $ 9,102 Europe, Middle East and Africa 1,630 1,672 4,811 4,933 Asia Pacific and Japan 787 821 2,311 2,346 Latin America, Mexico and Canada 344 327 965 1,010 Total $ 6,079 $ 6,032 $ 17,689 $ 17,391 No country other than the United States accounted for 10% or more of revenues during the three and nine months ended September 30, 2015 or 2014 . Long-lived assets, excluding financial instruments, deferred tax assets, goodwill and intangible assets, in the United States were $4,496 million at September 30, 2015 and $4,355 million at December 31, 2014 . Internationally, long-lived assets, excluding financial instruments, deferred tax assets, goodwill and intangible assets, were $985 million at September 30, 2015 and $1,021 million at December 31, 2014 . 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 September 30, 2015 or December 31, 2014 . |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
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, Pivotal and Virtustream. 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 and RSA Information Security. The results of Virtustream are currently reported within our Information Storage segment. 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 comprised 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: Pivotal Cloud Foundry, the Pivotal Big Data Suite and Pivotal Labs. Proposed Transaction with Dell On October 12, 2015, EMC entered into an Agreement and Plan of Merger (the “Merger Agreement”) among EMC, Denali Holding Inc., a Delaware corporation (“Parent”), Dell Inc., a Delaware corporation, and Universal Acquisition Co., a Delaware corporation and direct wholly owned subsidiary of Parent (“Merger Sub”), pursuant to which, among other things and subject to the conditions set forth therein, Merger Sub will merge with and into EMC (the “Merger”), with EMC continuing as the surviving corporation and a wholly owned subsidiary of Parent. At the effective time of the Merger (“Effective Time”), each share of EMC common stock issued and outstanding will be canceled and converted into the right to receive (i) $24.05 in cash and (ii) a number of shares of common stock of Parent designated as Class V Common Stock, par value $0.01 per share (the “Class V Common Stock”), equal to the quotient obtained by dividing (A) 222,966,450 by (B) the aggregate number of shares of EMC common stock issued and outstanding immediately prior to the Effective Time. The aggregate number of shares of Class V Common Stock issued as Merger Consideration in the transaction is intended to represent 65% of EMC’s economic interest in the approximately 81% of the outstanding shares of VMware currently owned by the EMC, reflecting approximately 53% of the total economic interest in the outstanding shares of VMware. Upon completion of the transaction, Parent will retain the remaining 28% of the total economic interest in the outstanding shares of VMware. Based on the estimated number of shares of EMC common stock at the closing of the transaction, EMC shareholders are expected to receive approximately 0.111 shares of Class V Common Stock for each share of EMC common stock. Under the terms of the Merger Agreement, EMC may solicit alternative acquisition proposals from third parties until 11:59 p.m. on December 11, 2015. The Merger Agreement contains specified termination rights for both Parent and EMC, including that, in general, either party may terminate if the Merger is not consummated on or before December 16, 2016. If EMC terminates the Merger Agreement, we are required to pay Parent a termination fee of $2.5 billion (or, if EMC terminates for a superior proposal prior to December 12, 2015, the termination fee payable by EMC to Parent will be $2 billion ). If Parent terminates the Merger Agreement, they are required to pay a termination fee of $4 billion under specified circumstances, and in certain instances, an alternative termination fee of $6 billion . The transaction is expected to close in mid-2016. The completion of the Merger is subject to certain conditions including EMC shareholder approval, the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, the receipt of certain other regulatory approvals in various jurisdictions and the effectiveness of the registration statement on Form S-4 to be filed by Parent in connection with the registration of shares of Class V Common Stock issuable in connection with the Merger. The Merger Agreement contains representations and warranties customary for transactions of this nature. EMC has agreed to various customary covenants and agreements, including, among others, agreements to conduct its business in the ordinary course during the period between the execution of the Merger Agreement and the effective time of the Merger. In addition, without the consent of Parent, EMC may not take, authorize, agree or commit to do certain actions outside of the ordinary course of business, including acquiring businesses or incurring capital expenditures above specified thresholds, issuing additional debt facilities and repurchasing outstanding EMC common stock. Under the terms of the Merger Agreement, EMC is required to provide Parent with access to EMC’s cash to help fund the Merger consideration. At this time, EMC has not finalized its plan to access such cash and has not determined if there would be a need to repatriate cash to meet the requirements of the Merger. To date, we have asserted our overseas cash as indefinitely reinvested; however if these overseas funds are required to be repatriated to the U.S. in accordance with the Merger Agreement, we may be required to accrue and pay U.S. taxes to repatriate these funds. Other than transaction expenses associated with the proposed Merger, the terms of the Merger Agreement did not impact EMC’s consolidated financial statements as of and for the three and nine months ended September 30, 2015. |
General | General The accompanying interim consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. These consolidated financial statements include the accounts of EMC, its wholly owned subsidiaries, as well as VMware and Pivotal, companies majority-owned by EMC. All intercompany transactions have been eliminated. Certain information and footnote disclosures normally included in our annual consolidated financial statements have been condensed or omitted. Accordingly, these interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2014 which are contained in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 27, 2015. The results of operations for the interim periods are not necessarily indicative of the results of operations to be expected for any future period or the entire fiscal year. The interim consolidated financial statements, in the opinion of management, reflect all adjustments necessary to fairly state the results as of and for the three - and nine -month periods ended September 30, 2015 and 2014 . |
Net Income Per Share | Net Income Per Share Basic net income per weighted average share has been computed using the weighted average number of shares of common stock outstanding during the period. Diluted net income per weighted average 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, restricted stock and restricted stock units, and in the three and nine months ended September 30, 2014, the shares issuable under our $1.725 billion 1.75% convertible senior notes due 2013 (the “2013 Notes”) and the associated warrants. Additionally, for purposes of calculating diluted net income per weighted average share, net income is adjusted for the difference between VMware’s reported diluted and basic net income per weighted average share, if any, multiplied by the number of shares of VMware held by EMC. |
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. In December 2014, EMC acquired the controlling interest in VCE and, since the date of acquisition, has consolidated VCE’s financial position and results of operations as part of EMC’s consolidated financial statements. Prior to the acquisition of the controlling interest in VCE, we considered VCE a variable interest entity and 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 . Our consolidated share of VCE’s losses, based upon our portion of the overall funding, was approximately 65% and 64% for the three and nine months ended September 30, 2014 , respectively. During the three and nine months ended September 30, 2014 , we recorded $101 million and $261 million , respectively, in net losses from VCE and $207 million and $550 million , respectively, in revenue from sales of product and services to VCE. |
Reclassifications | Reclassifications Certain prior year amounts have been reclassified to conform with the current year’s presentation. In April 2015, the Financial Accounting Standards Board (“FASB”) issued updated guidance to clarify the required presentation of debt issuance costs. The amended guidance requires that debt issuance costs be presented in the balance sheet as a direct reduction from the carrying amount of the related debt liability rather than as an asset. We adopted the guidance during the second quarter of 2015, and accordingly, reclassified the debt issuance costs on our consolidated balance sheets. There was no impact to our consolidated income statements or statements of cash flows. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In September 2015, the FASB issued updated guidance related to simplifying the accounting for measurement period adjustments related to business combinations. The amended guidance eliminates the requirement to retrospectively account for adjustments made during the measurement period. The standard is effective beginning January 1, 2016, with early adoption permitted. We do not expect it to have a material impact on our consolidated financial position, results of operations or cash flows. In April 2015, the FASB issued guidance to customers about whether a cloud computing arrangement includes software and how to account for that software license. The new guidance does not change the accounting for a customer’s accounting for service contracts. The standard is effective beginning January 1, 2017, with early adoption permitted, and may be applied prospectively or retrospectively. We do not expect it to have a material impact on our consolidated financial position, results of operations or cash flows. In May 2014, the 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, as amended, is effective beginning January 1, 2018, with early adoption permitted but not earlier than the original effective date of January 1, 2017. 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. |
Non-controlling Interests (Tabl
Non-controlling Interests (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
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 Nine Months Ended September 30, September 30, Net income attributable to EMC Corporation $ 1,219 $ 1,568 Transfers (to) from the non-controlling interests in VMware, Inc.: Increase in EMC Corporation’s additional paid-in-capital for VMware’s equity issuances 60 84 Decrease in EMC Corporation’s additional paid-in-capital for VMware’s other equity activity (886 ) (510 ) Net transfers (to) from non-controlling interest (826 ) (426 ) Change from net income attributable to EMC Corporation and transfers from the non-controlling interest in VMware, Inc. $ 393 $ 1,142 |
Business Combinations, Intang25
Business Combinations, Intangibles and Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Business Acquisition [Line Items] | |
Intangible Assets, Excluding Goodwill | Intangible Assets Intangible assets, excluding goodwill, as of September 30, 2015 and December 31, 2014 consist of (tables in millions): September 30, 2015 Gross Carrying Amount Accumulated Amortization Net Book Value Purchased technology $ 3,266 $ (1,845 ) $ 1,421 Patents 225 (128 ) 97 Software licenses 111 (94 ) 17 Trademarks and tradenames 253 (151 ) 102 Customer relationships and customer lists 1,523 (1,060 ) 463 Leasehold interest 152 (19 ) 133 Other 46 (40 ) 6 Total intangible assets, excluding goodwill $ 5,576 $ (3,337 ) $ 2,239 December 31, 2014 Gross Carrying Amount Accumulated Amortization Net Book Value 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 |
Changes in Carrying Amount of Goodwill | Goodwill Changes in the carrying amount of goodwill, net, on a consolidated basis and by segment, for the nine months ended September 30, 2015 consist of (table in millions): Nine Months Ended September 30, 2015 Information Storage Enterprise Content Division RSA Information Security Pivotal VMware Virtual Infrastructure Total Balance, beginning of the period $ 8,266 $ 1,486 $ 2,203 $ 171 $ 4,008 $ 16,134 Goodwill resulting from acquisitions 935 — — 3 17 955 Finalization of purchase price allocations and other, net 2 (8 ) — — — (6 ) Balance, end of the period $ 9,203 $ 1,478 $ 2,203 $ 174 $ 4,025 $ 17,083 |
Virtustream | |
Business Acquisition [Line Items] | |
Schedule of Business Acquisitions, by Acquisition | 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): Current assets $ 18 Property, plant and equipment, net 14 Intangible assets: Purchased technology (weighted-average useful life of 8.6 years) 302 Customer relationships and customer lists (weighted-average useful life of 12.3 years) 50 Trademarks and tradenames (weighted-average useful life of 7.6 years) 27 Total intangible assets, net, excluding goodwill 379 Goodwill 891 Other assets, net 12 Total assets acquired 1,314 Current liabilities (27 ) Deferred income taxes (61 ) Other liabilities (7 ) Total net liabilities assumed (95 ) Fair value of assets acquired and net liabilities assumed $ 1,219 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Long-term Debt | Our long-term debt as of September 30, 2015 was as follows (dollars in millions): Senior Notes Issued at Discount to Par Carrying Value $2.5 billion 1.875% Notes due 2018 99.943 % $ 2,499 $2.0 billion 2.650% Notes due 2020 99.760 % 1,996 $1.0 billion 3.375% Notes due 2023 99.925 % 1,000 $ 5,495 Debt issuance costs (21 ) Net long-term debt $ 5,474 |
Fair Value of Financial Asset27
Fair Value of Financial Assets and Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Composition of Investments | December 31, 2014 Amortized Cost Unrealized Gains Unrealized (Losses) Aggregate 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 The following tables summarize the composition of our short- and long-term investments at September 30, 2015 and December 31, 2014 (tables in millions): September 30, 2015 Amortized Cost Unrealized Gains Unrealized (Losses) Aggregate Fair Value U.S. government and agency obligations $ 2,376 $ 5 $ (1 ) $ 2,380 U.S. corporate debt securities 2,549 4 (5 ) 2,548 High yield corporate debt securities 370 2 (22 ) 350 Asset-backed securities 30 — — 30 Municipal obligations 850 2 — 852 Auction rate securities 27 — (2 ) 25 Foreign debt securities 2,559 3 (8 ) 2,554 Total fixed income securities 8,761 16 (38 ) 8,739 Publicly traded equity securities 178 52 (9 ) 221 Total $ 8,939 $ 68 $ (47 ) $ 8,960 |
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 September 30, 2015 and December 31, 2014 (tables in millions): September 30, 2015 Level 1 Level 2 Level 3 Total Cash $ 1,643 $ — $ — $ 1,643 Cash equivalents 3,264 417 — 3,681 U.S. government and agency obligations 1,404 976 — 2,380 U.S. corporate debt securities — 2,548 — 2,548 High yield corporate debt securities — 350 — 350 Asset-backed securities — 30 — 30 Municipal obligations — 852 — 852 Auction rate securities — — 25 25 Foreign debt securities — 2,554 — 2,554 Publicly traded equity securities 221 — — 221 Total cash and investments $ 6,532 $ 7,727 $ 25 $ 14,284 Other items: Strategic investments held at cost $ — $ — $ 382 $ 382 Investment in joint venture — — 38 38 Long-term debt carried at discounted cost — (5,514 ) — (5,514 ) Foreign exchange derivative assets — 49 — 49 Foreign exchange derivative liabilities — (47 ) — (47 ) Commodity derivative liabilities — (4 ) — (4 ) 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 held at cost $ — $ — $ 333 $ 333 Investment in joint venture — — 37 37 Long-term debt carried at discounted cost — (5,544 ) — (5,544 ) Foreign exchange derivative assets — 44 — 44 Foreign exchange derivative liabilities — (71 ) — (71 ) Commodity derivative assets — 12 — 12 |
Unrealized Losses on Investments by Investment Category and Length of Time in Continuous Unrealized Loss Position | Unrealized losses on investments at September 30, 2015 by investment category and length of time the investment has been in a continuous unrealized loss position are as follows (table in millions): Less Than 12 Months 12 Months or Greater Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses U.S. government and agency obligations $ 321 $ (1 ) $ — $ — $ 321 $ (1 ) U.S. corporate debt securities 1,103 (5 ) — — 1,103 (5 ) High yield corporate debt securities 239 (17 ) 30 (5 ) 269 (22 ) Auction rate securities — — 25 (2 ) 25 (2 ) Foreign debt securities 1,220 (8 ) — — 1,220 (8 ) Publicly traded equity securities 2 (1 ) 19 (8 ) 21 (9 ) Total $ 2,885 $ (32 ) $ 74 $ (15 ) $ 2,959 $ (47 ) |
Contractual Maturities of Investments | The contractual maturities of fixed income securities held at September 30, 2015 are as follows (table in millions): September 30, 2015 Amortized Cost Basis Aggregate Fair Value Due within one year $ 2,302 $ 2,303 Due after 1 year through 5 years 5,618 5,617 Due after 5 years through 10 years 523 503 Due after 10 years 318 316 Total $ 8,761 $ 8,739 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Components of Inventories | Inventories consist of (table in millions): September 30, December 31, Work-in-process $ 580 $ 627 Finished goods 644 649 $ 1,224 $ 1,276 |
Accounts and Notes Receivable29
Accounts and Notes Receivable and Allowance for Credit Losses (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Receivables [Abstract] | |
Contractual Amounts Due Under Leases | The contractual amounts due under the leases we retained as of September 30, 2015 were as follows (table in millions): Year Contractual Amounts Due Under Leases Due within one year $ 65 Due within two years 45 Due within three years 31 Thereafter 1 Total 142 Less: Amounts representing interest 5 Present value 137 Current portion (included in accounts and notes receivable) 62 Long-term portion (included in other assets, net) $ 75 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
Components of Property, Plant and Equipment | Property, plant and equipment consist of (table in millions): September 30, December 31, Furniture and fixtures $ 280 $ 255 Equipment and software 7,305 6,684 Buildings and improvements 2,357 2,308 Land 170 162 Building construction in progress 68 134 10,180 9,543 Accumulated depreciation (6,389 ) (5,777 ) $ 3,791 $ 3,766 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Payables and Accruals [Abstract] | |
Components of Accrued Expenses | Accrued expenses consist of (table in millions): September 30, December 31, Salaries and benefits $ 1,075 $ 1,251 Product warranties 180 207 Dividends payable (see Note 11) 232 237 Partner rebates 204 235 Restructuring, current (See Note 12) 162 123 Derivatives 51 75 Other 927 1,013 $ 2,831 $ 3,141 |
Activity in Warranty Accrual for Product Warranty | The following represents the activity in our warranty accrual for the three and nine months ended September 30, 2015 and 2014 (table in millions): For the Three Months Ended For the Nine Months Ended September 30, September 30, September 30, September 30, Balance, beginning of the period $ 189 $ 254 $ 207 $ 286 Provision 32 32 109 107 Amounts charged against the accrual (41 ) (59 ) (136 ) (166 ) Balance, end of the period $ 180 $ 227 $ 180 $ 227 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
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): For the Three Months Ended For the Nine Months Ended September 30, September 30, September 30, September 30, Numerator: Net income attributable to EMC Corporation $ 480 $ 587 $ 1,219 $ 1,568 Incremental dilution from VMware (1 ) (1 ) (3 ) (4 ) Net income – dilution attributable to EMC Corporation $ 479 $ 586 $ 1,216 $ 1,564 Denominator: Weighted average shares, basic 1,934 2,032 1,945 2,033 Weighted common stock equivalents 14 25 18 26 Assumed conversion of the 2013 Notes and associated warrants — — — 6 Weighted average shares, diluted 1,948 2,057 1,963 2,065 |
Dividends Declared | Declaration Date Dividend Per Share Record Date Total Amount (in millions) Payment Date 2015: February 27, 2015 $ 0.115 April 1, 2015 $ 229 April 23, 2015 May 20, 2015 $ 0.115 July 1, 2015 $ 226 July 23, 2015 July 30, 2015 $ 0.115 October 1, 2015 $ 229 October 23, 2015 2014: February 6, 2014 $ 0.10 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 December 9, 2014 $ 0.115 January 2, 2015 $ 234 January 23, 2015 |
Accumulated Other Comprehensive Loss | Changes in accumulated other comprehensive income (loss), which is presented net of tax, for the nine months ended September 30, 2015 and 2014 consist of the following (tables 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 December, 31 2014 (a) $ (187 ) $ 49 $ (99 ) $ (126 ) $ (3 ) $ (366 ) Other comprehensive income (loss) before reclassifications (137 ) (10 ) 11 — 3 (133 ) Net losses (gains) reclassified from accumulated other comprehensive income — (26 ) (8 ) — — (34 ) Net current period other comprehensive income (loss) (137 ) (36 ) 3 — 3 (167 ) Balance as of September 30, 2015 (b) $ (324 ) $ 13 $ (96 ) $ (126 ) $ — $ (533 ) __________________ (a) 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. (b) Net of taxes (benefits) of $8 million for unrealized net gains on investments, $(58) million for unrealized net losses on derivatives and $(70) million for actuarial net loss on pension plans . 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 December, 31 2013 (a) $ (53 ) $ 31 $ (106 ) $ (110 ) $ (1 ) $ (239 ) Other comprehensive income (loss) before reclassifications (57 ) 107 11 2 — 63 Net losses (gains) reclassified from accumulated other comprehensive income — (19 ) (2 ) (1 ) — (22 ) Net current period other comprehensive income (loss) (57 ) 88 9 1 — 41 Balance as of September 30, 2014 (b) $ (110 ) $ 119 $ (97 ) $ (109 ) $ (1 ) $ (198 ) __________________ (a) 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. (b) Net of taxes (benefits) of $72 million for unrealized net gains on investments, $(63) million for unrealized net losses on derivatives and $(61) million for actuarial net loss on pension plans. |
Reclassification Out Of Accumulated Other Comprehensive Income | The amounts reclassified out of accumulated other comprehensive income (loss) for the three and nine months ended September 30, 2015 and 2014 are as follows (tables in millions): For the Three Months Ended Accumulated Other Comprehensive Income Components September 30, 2015 September 30, 2014 Impacted Line Item on Consolidated Income Statements Net gain on investments: $ 8 $ 13 Investment income (3 ) (5 ) Provision for income tax Net of tax $ 5 $ 8 Net gain on derivatives: Foreign exchange contracts $ 1 $ 12 Product sales revenue Foreign exchange contracts — (7 ) Cost of product sales Interest rate swap (6 ) (6 ) Other interest expense Total net gain (loss) on derivatives before tax (5 ) (1 ) 2 — Provision for income tax Net of tax $ (3 ) $ (1 ) Net gain from pension and other postretirement plans $ — $ 1 Selling, general and administrative expense — — Provision for income tax Net of tax $ — $ 1 For the Nine Months Ended Accumulated Other Comprehensive Income Components September 30, 2015 September 30, 2014 Impacted Line Item on Consolidated Income Statements Net gain on investments: $ 42 $ 30 Investment income (16 ) (11 ) Provision for income tax Net of tax $ 26 $ 19 Net gain on derivatives: Foreign exchange contracts $ 22 $ 15 Product sales revenue Foreign exchange contracts (1 ) (7 ) Cost of product sales Interest rate swap (17 ) (6 ) Other interest expense Total net gain on derivatives before tax 4 2 4 — Provision for income tax Net of tax $ 8 $ 2 Net gain from pension and other postretirement plans $ — $ 1 Selling, general and administrative expense — — Provision for income tax Net of tax $ — $ 1 |
Restructuring and Acquisition33
Restructuring and Acquisition-Related Charges (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Restructuring and Related Activities [Abstract] | |
Activity for the Restructuring Programs | The activity for the restructuring programs is presented below (tables in millions): Three Months Ended September 30, 2015 : 2015 EMC Programs Category Balance as of June 30, 2015 2015 Charges Utilization Balance as of September 30, 2015 Workforce reductions $ 89 $ 62 $ (33 ) $ 118 Consolidation of excess facilities and other contractual obligations 12 6 (3 ) 15 Total $ 101 $ 68 $ (36 ) $ 133 Other EMC Programs Category Balance as of Adjustments to the Provision Utilization Balance as of September 30, 2015 Workforce reductions $ 43 $ (1 ) $ (14 ) $ 28 Consolidation of excess facilities and other contractual obligations 13 (1 ) (1 ) 11 Total $ 56 $ (2 ) $ (15 ) $ 39 Nine Months Ended September 30, 2015 : 2015 EMC Programs Category Balance as of December 31, 2014 2015 Charges Utilization Balance as of September 30, 2015 Workforce reductions $ — $ 185 $ (67 ) $ 118 Consolidation of excess facilities and other contractual obligations — 23 (8 ) 15 Total $ — $ 208 $ (75 ) $ 133 Other EMC Programs Category Balance as of Adjustments to the Provision Utilization Balance as of September 30, 2015 Workforce reductions $ 102 $ (7 ) $ (67 ) $ 28 Consolidation of excess facilities and other contractual obligations 19 (1 ) (7 ) 11 Total $ 121 $ (8 ) $ (74 ) $ 39 VMware Programs Category Balance as of 2015 Charges Utilization Balance as of September 30, 2015 Workforce reductions $ 8 $ 20 $ (27 ) $ 1 Consolidation of excess facilities and other contractual obligations — — — — Total $ 8 $ 20 $ (27 ) $ 1 Three Months Ended September 30, 2014 : 2014 EMC Programs Category Balance as of 2014 Charges Utilization Balance as of September 30, 2014 Workforce reductions $ 98 $ 30 $ (33 ) $ 95 Consolidation of excess facilities and other contractual obligations 3 2 (2 ) 3 Total $ 101 $ 32 $ (35 ) $ 98 Other EMC Programs Category Balance as of Adjustments to the Provision Utilization Balance as of September 30, 2014 Workforce reductions $ 17 $ (1 ) $ (6 ) $ 10 Consolidation of excess facilities and other contractual obligations 18 — (1 ) 17 Total $ 35 $ (1 ) $ (7 ) $ 27 Nine Months Ended September 30, 2014: 2014 EMC Programs Category Balance as of 2014 Charges Utilization Balance as of September 30, 2014 Workforce reductions $ — $ 179 $ (84 ) $ 95 Consolidation of excess facilities and other contractual obligations — 7 (4 ) 3 Total $ — $ 186 $ (88 ) $ 98 Other EMC Programs Category Balance as of Adjustments to the Provision Utilization Balance as of September 30, 2014 Workforce reductions $ 66 $ (14 ) $ (42 ) $ 10 Consolidation of excess facilities and other contractual obligations 24 3 (10 ) 17 Total $ 90 $ (11 ) $ (52 ) $ 27 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | Our segment information for the three and nine months ended September 30, 2015 and 2014 is as follows (tables in millions, except percentages): EMC Information Infrastructure Information Storage Enterprise Content Division RSA Information Security EMC Information Infrastructure Pivotal EMC Information Infrastructure plus Pivotal Three Months Ended September 30, 2015 Revenues: Product revenues $ 2,424 $ 37 $ 106 $ 2,567 $ 22 $ 2,589 Services revenues 1,537 107 137 1,781 45 1,826 Total consolidated revenues 3,961 144 243 4,348 67 4,415 Gross profit $ 2,071 $ 97 $ 163 $ 2,331 $ 24 $ 2,355 Gross profit percentage 52.3 % 67.3 % 66.9 % 53.6 % 36.2 % 53.3 % Research and development 397 28 425 Selling, general and administrative 1,220 54 1,274 Restructuring and acquisition-related charges — — — Total operating expenses 1,617 82 1,699 Operating income (expense) $ 714 $ (58 ) $ 656 EMC Information Infrastructure plus Pivotal VMware Virtual Infrastructure Corp Reconciling Items Consolidated Three Months Ended September 30, 2015 Revenues: Product revenues $ 2,589 $ 680 $ — $ 3,269 Services revenues 1,826 984 — 2,810 Total consolidated revenues 4,415 1,664 — 6,079 Gross profit $ 2,355 $ 1,451 $ (101 ) $ 3,705 Gross profit percentage 53.3 % 87.2 % — % 60.9 % Research and development 425 274 103 802 Selling, general and administrative 1,274 651 220 2,145 Restructuring and acquisition-related charges — — 68 68 Total operating expenses 1,699 925 391 3,015 Operating income (expense) 656 526 (492 ) 690 Non-operating income (expense), net 2 4 — 6 Income tax provision (benefit) 185 89 (106 ) 168 Net income 473 441 (386 ) 528 Net income attributable to the non-controlling interest in VMware, Inc. — (77 ) 29 (48 ) Net income attributable to EMC Corporation $ 473 $ 364 $ (357 ) $ 480 EMC Information Infrastructure Information Storage Enterprise Content Division RSA Information Security EMC Information Infrastructure Pivotal EMC Information Infrastructure plus Pivotal Three Months Ended September 30, 2014 Revenues: Product revenues $ 2,595 $ 36 $ 114 $ 2,745 $ 17 $ 2,762 Services revenues 1,456 118 147 1,721 41 1,762 Total consolidated revenues 4,051 154 261 4,466 58 4,524 Gross profit $ 2,238 $ 100 $ 173 $ 2,511 $ 27 $ 2,538 Gross profit percentage 55.2 % 65.2 % 66.3 % 56.2 % 46.9 % 56.1 % Research and development 372 33 405 Selling, general and administrative 1,146 46 1,192 Restructuring and acquisition-related charges — — — Total operating expenses 1,518 79 1,597 Operating income (expense) $ 993 $ (52 ) $ 941 EMC Information Infrastructure plus Pivotal VMware Virtual Infrastructure Corp Reconciling Items Consolidated Three Months Ended September 30, 2014 Revenues: Product revenues $ 2,762 $ 638 $ — $ 3,400 Services revenues 1,762 870 — 2,632 Total consolidated revenues 4,524 1,508 — 6,032 Gross profit $ 2,538 $ 1,304 $ (99 ) $ 3,743 Gross profit percentage 56.1 % 86.5 % — % 62.0 % Research and development 405 263 99 767 Selling, general and administrative 1,192 586 212 1,990 Restructuring and acquisition-related charges — — 39 39 Total operating expenses 1,597 849 350 2,796 Operating income (expense) 941 455 (449 ) 947 Non-operating income (expense), net (120 ) 6 — (114 ) Income tax provision (benefit) 207 99 (100 ) 206 Net income 614 362 (349 ) 627 Net income attributable to the non-controlling interest in VMware, Inc. — (73 ) 33 (40 ) Net income attributable to EMC Corporation $ 614 $ 289 $ (316 ) $ 587 EMC Information Infrastructure Information Storage Enterprise Content Division RSA Information Security EMC Information Infrastructure Pivotal EMC Information Infrastructure plus Pivotal Nine Months Ended September 30, 2015 Revenues: Product revenues $ 7,113 $ 103 $ 303 $ 7,519 $ 57 $ 7,576 Services revenues 4,539 333 427 5,299 128 5,427 Total consolidated revenues 11,652 436 730 12,818 185 13,003 Gross profit $ 6,014 $ 291 $ 487 $ 6,792 $ 71 $ 6,863 Gross profit percentage 51.6 % 66.8 % 66.7 % 53.0 % 38.7 % 52.8 % Research and development 1,219 79 1,298 Selling, general and administrative 3,591 156 3,747 Restructuring and acquisition-related charges — — — Total operating expenses 4,810 235 5,045 Operating income (expense) $ 1,982 $ (164 ) $ 1,818 EMC Information Infrastructure plus Pivotal VMware Virtual Infrastructure Corp Reconciling Items Consolidated Nine Months Ended September 30, 2015 Revenues: Product revenues $ 7,576 $ 1,899 $ (76 ) $ 9,399 Services revenues 5,427 2,863 — 8,290 Total consolidated revenues 13,003 4,762 (76 ) 17,689 Gross profit $ 6,863 $ 4,143 $ (375 ) $ 10,631 Gross profit percentage 52.8 % 87.0 % — % 60.1 % Research and development 1,298 788 286 2,372 Selling, general and administrative 3,747 1,896 642 6,285 Restructuring and acquisition-related charges — — 226 226 Total operating expenses 5,045 2,684 1,154 8,883 Operating income (expense) 1,818 1,459 (1,529 ) 1,748 Non-operating income (expense), net 7 24 (20 ) 11 Income tax provision (benefit) 494 285 (359 ) 420 Net income 1,331 1,198 (1,190 ) 1,339 Net income attributable to the non-controlling interest in VMware, Inc. — (224 ) 104 (120 ) Net income attributable to EMC Corporation $ 1,331 $ 974 $ (1,086 ) $ 1,219 EMC Information Infrastructure Information Storage Enterprise Content Division RSA Information Security EMC Information Infrastructure Pivotal EMC Information Infrastructure plus Pivotal Nine Months Ended September 30, 2014 Revenues: Product revenues $ 7,447 $ 108 $ 323 $ 7,878 $ 43 $ 7,921 Services revenues 4,260 358 425 5,043 118 5,161 Total consolidated revenues 11,707 466 748 12,921 161 13,082 Gross profit $ 6,405 $ 300 $ 497 $ 7,202 $ 71 $ 7,273 Gross profit percentage 54.7 % 64.4 % 66.4 % 55.7 % 44.3 % 55.6 % Research and development 1,106 98 1,204 Selling, general and administrative 3,388 133 3,521 Restructuring and acquisition-related charges — — — Total operating expenses 4,494 231 4,725 Operating income (expense) $ 2,708 $ (160 ) $ 2,548 EMC Information Infrastructure plus Pivotal VMware Virtual Infrastructure Corp Reconciling Items Consolidated Nine Months Ended September 30, 2014 Revenues: Product revenues $ 7,921 $ 1,807 $ — $ 9,728 Services revenues 5,161 2,502 — 7,663 Total consolidated revenues 13,082 4,309 — 17,391 Gross profit $ 7,273 $ 3,761 $ (290 ) $ 10,744 Gross profit percentage 55.6 % 87.3 % — % 61.8 % Research and development 1,204 737 298 2,239 Selling, general and administrative 3,521 1,725 606 5,852 Restructuring and acquisition-related charges — — 187 187 Total operating expenses 4,725 2,462 1,091 8,278 Operating income (expense) 2,548 1,299 (1,381 ) 2,466 Non-operating income (expense), net (285 ) 21 11 (253 ) Income tax provision (benefit) 584 274 (326 ) 532 Net income 1,679 1,046 (1,044 ) 1,681 Net income attributable to the non-controlling interest in VMware, Inc. — (211 ) 98 (113 ) Net income attributable to EMC Corporation $ 1,679 $ 835 $ (946 ) $ 1,568 |
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): For the Three Months Ended For the Nine Months Ended September 30, September 30, September 30, September 30, United States $ 3,318 $ 3,212 $ 9,602 $ 9,102 Europe, Middle East and Africa 1,630 1,672 4,811 4,933 Asia Pacific and Japan 787 821 2,311 2,346 Latin America, Mexico and Canada 344 327 965 1,010 Total $ 6,079 $ 6,032 $ 17,689 $ 17,391 |
Basis of Presentation - Additio
Basis of Presentation - Additional Information (Detail) - Convertible Senior Notes 2013 $ in Millions | Nov. 13, 2006USD ($) |
Debt Instrument [Line Items] | |
Convertible senior notes included in calculation of net income per share | $ 1,725 |
Convertible senior notes interest rate | 1.75% |
Basis of Presentation Schedule
Basis of Presentation Schedule of Equity Investments (Details) - VCE Company LLC - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
Sep. 30, 2014 | Sep. 30, 2014 | |
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investment Share Of Gain Losses | 65.00% | 64.00% |
Income (Loss) from Equity Method Investments | $ 101 | $ 261 |
Revenue from Related Parties | $ 207 | $ 550 |
Basis of Presentation Merger (D
Basis of Presentation Merger (Details) - USD ($) $ / shares in Units, $ in Billions | Oct. 12, 2015 | Sep. 30, 2015 | Dec. 31, 2014 |
Business Acquisition [Line Items] | |||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 | |
VMware | |||
Business Acquisition [Line Items] | |||
Noncontrolling Interest, Ownership Percentage by Parent | 81.00% | ||
Subsequent Event | Denali | |||
Business Acquisition [Line Items] | |||
Resulting Percent of VMware which represents Merger consideration | 53.00% | ||
Economic interest of VMware Parent will retain | 28.00% | ||
Percent of EMC's interest in VMware which represents Merger consideration | 65.00% | ||
Business Acquisition, Share Price | $ 24.05 | ||
Common stock, par value (in usd per share) | $ 0.01 | ||
Investment Owned, Balance, Shares | 222,966,450 | ||
Tracker Stock Fractional Share | 0.111 | ||
Termination Fee Paid by EMC to Denali | $ 2.5 | ||
Termination Fee Paid by EMC to Denali if before December 12, 2015 | 2 | ||
Termination Fee Paid by Denali to EMC | 4 | ||
Alternative Termination Fee Paid by Denali to EMC | $ 6 |
Non-controlling Interests - Add
Non-controlling Interests - Additional Information (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Noncontrolling Interest [Line Items] | ||
Non-controlling interest | $ 1,511 | $ 1,629 |
VMware | ||
Noncontrolling Interest [Line Items] | ||
Non-controlling interest | $ 1,406 | 1,524 |
Voting power of VMware's outstanding common stock | 97.00% | |
Noncontrolling Interest, Ownership Percentage by Parent | 81.00% | |
Pivotal | ||
Noncontrolling Interest [Line Items] | ||
Non-controlling interest | $ 105 | $ 105 |
Noncontrolling Interest, Ownership Percentage by Parent | 84.00% |
Non-controlling Interests - Eff
Non-controlling Interests - Effect of Changes in Ownership Interest in VMware on Equity (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Noncontrolling Interest [Line Items] | ||||
Net income attributable to EMC Corporation | $ 480 | $ 587 | $ 1,219 | $ 1,568 |
Transfers (to) from the non-controlling interests in VMware, Inc.: | ||||
Net transfers (to) from non-controlling interest | (1,061) | (402) | ||
VMware | ||||
Noncontrolling Interest [Line Items] | ||||
Net income attributable to EMC Corporation | 1,219 | 1,568 | ||
Transfers (to) from the non-controlling interests in VMware, Inc.: | ||||
Increase in EMC Corporation’s additional paid-in-capital for VMware’s equity issuances | 60 | 84 | ||
Decrease in EMC Corporation’s additional paid-in-capital for VMware’s other equity activity | (886) | (510) | ||
Net transfers (to) from non-controlling interest | (826) | (426) | ||
Change from net income attributable to EMC Corporation and transfers from the non-controlling interest in VMware, Inc. | $ 393 | $ 1,142 |
Business Combinations, Intang40
Business Combinations, Intangibles and Goodwill - Additional Information (Details) $ in Millions | 9 Months Ended | ||
Sep. 30, 2015USD ($)acquisition | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) | |
Business Acquisition [Line Items] | |||
Cash paid | $ 1,304 | $ 1,771 | |
Aggregate allocation to goodwill | 17,083 | $ 16,134 | |
Virtustream | |||
Business Acquisition [Line Items] | |||
Aggregate consideration | 1,219 | ||
Aggregate allocation to intangibles | $ 379 | ||
Weighted average amortization period of intangible assets acquired | 9 years | ||
All 2015 acquisitions excluding Virtustream | |||
Business Acquisition [Line Items] | |||
Aggregate consideration | $ 89 | ||
Number of Businesses Acquired | acquisition | 5 | ||
Aggregate allocation to goodwill | $ 64 | ||
Aggregate allocation to intangibles | 33 | ||
Aggregate allocation to net liabilities | $ (8) | ||
Weighted average amortization period of intangible assets acquired | 3 years 7 months |
Business Combinations, Intang41
Business Combinations, Intangibles and Goodwill - Allocation of Purchase Price (Details) - Virtustream $ in Millions | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Business Acquisition [Line Items] | |
Weighted-average useful life | 9 years |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets | $ 18 |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 14 |
Intangible assets | 379 |
Business Acquisition, Goodwill, Expected Tax Deductible Amount | 891 |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets | 12 |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets | 1,314 |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities | (27) |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Liabilities Noncurrent | (61) |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Other | (7) |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | (95) |
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net | $ 1,219 |
Purchased technology | |
Business Acquisition [Line Items] | |
Weighted-average useful life | 8 years 7 months |
Intangible assets | $ 302 |
Customer relationships and customer lists | |
Business Acquisition [Line Items] | |
Weighted-average useful life | 12 years 3 months |
Intangible assets | $ 50 |
Trademarks and tradenames | |
Business Acquisition [Line Items] | |
Weighted-average useful life | 7 years 7 months |
Intangible assets | $ 27 |
Business Combinations, Intang42
Business Combinations, Intangibles and Goodwill - Intangible Assets (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Schedule of Intangible Assets, Excluding Goodwill [Line Items] | ||
Gross Carrying Amount | $ 5,576 | $ 5,163 |
Accumulated Amortization | (3,337) | (3,038) |
Net Book Value | 2,239 | 2,125 |
Purchased technology | ||
Schedule of Intangible Assets, Excluding Goodwill [Line Items] | ||
Gross Carrying Amount | 3,266 | 2,935 |
Accumulated Amortization | (1,845) | (1,668) |
Net Book Value | 1,421 | 1,267 |
Patents | ||
Schedule of Intangible Assets, Excluding Goodwill [Line Items] | ||
Gross Carrying Amount | 225 | 225 |
Accumulated Amortization | (128) | (117) |
Net Book Value | 97 | 108 |
Software licenses | ||
Schedule of Intangible Assets, Excluding Goodwill [Line Items] | ||
Gross Carrying Amount | 111 | 108 |
Accumulated Amortization | (94) | (93) |
Net Book Value | 17 | 15 |
Trademarks and tradenames | ||
Schedule of Intangible Assets, Excluding Goodwill [Line Items] | ||
Gross Carrying Amount | 253 | 226 |
Accumulated Amortization | (151) | (136) |
Net Book Value | 102 | 90 |
Customer relationships and customer lists | ||
Schedule of Intangible Assets, Excluding Goodwill [Line Items] | ||
Gross Carrying Amount | 1,523 | 1,473 |
Accumulated Amortization | (1,060) | (974) |
Net Book Value | 463 | 499 |
Leasehold interest | ||
Schedule of Intangible Assets, Excluding Goodwill [Line Items] | ||
Gross Carrying Amount | 152 | 152 |
Accumulated Amortization | (19) | (16) |
Net Book Value | 133 | 136 |
Other | ||
Schedule of Intangible Assets, Excluding Goodwill [Line Items] | ||
Gross Carrying Amount | 46 | 44 |
Accumulated Amortization | (40) | (34) |
Net Book Value | $ 6 | $ 10 |
Business Combinations, Intang43
Business Combinations, Intangibles and Goodwill - Goodwill (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Goodwill [Roll Forward] | |
Balance, beginning of the period | $ 16,134 |
Goodwill resulting from acquisitions | 955 |
Finalization of purchase price allocations and other, net | (6) |
Balance, end of the period | 17,083 |
Information Storage | |
Goodwill [Roll Forward] | |
Balance, beginning of the period | 8,266 |
Goodwill resulting from acquisitions | 935 |
Finalization of purchase price allocations and other, net | 2 |
Balance, end of the period | 9,203 |
Enterprise Content Division | |
Goodwill [Roll Forward] | |
Balance, beginning of the period | 1,486 |
Goodwill resulting from acquisitions | 0 |
Finalization of purchase price allocations and other, net | (8) |
Balance, end of the period | 1,478 |
RSA Information Security | |
Goodwill [Roll Forward] | |
Balance, beginning of the period | 2,203 |
Goodwill resulting from acquisitions | 0 |
Finalization of purchase price allocations and other, net | 0 |
Balance, end of the period | 2,203 |
Pivotal | |
Goodwill [Roll Forward] | |
Balance, beginning of the period | 171 |
Goodwill resulting from acquisitions | 3 |
Finalization of purchase price allocations and other, net | 0 |
Balance, end of the period | 174 |
VMware Virtual Infrastructure within EMC | |
Goodwill [Roll Forward] | |
Balance, beginning of the period | 4,008 |
Goodwill resulting from acquisitions | 17 |
Finalization of purchase price allocations and other, net | 0 |
Balance, end of the period | $ 4,025 |
Debt - Key Components of Long-t
Debt - Key Components of Long-term Debt (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2014 | |
Debt Instrument [Line Items] | ||
Carrying Value | $ 5,474,000,000 | $ 5,469,000,000 |
Long-term Notes $2.5B | ||
Debt Instrument [Line Items] | ||
Debt, face amount | $ 2,500,000,000 | |
Stated interest rate | 1.875% | |
Issued at Discount to Par | 99.943% | |
Carrying Value | $ 2,499,000,000 | |
Long-term Notes $2.0B | ||
Debt Instrument [Line Items] | ||
Debt, face amount | $ 2,000,000,000 | |
Stated interest rate | 2.65% | |
Issued at Discount to Par | 99.76% | |
Carrying Value | $ 1,996,000,000 | |
Long-term Notes $1.0B | ||
Debt Instrument [Line Items] | ||
Debt, face amount | $ 1,000,000,000 | |
Stated interest rate | 3.375% | |
Issued at Discount to Par | 99.925% | |
Carrying Value | $ 1,000,000,000 | |
Long-term Notes $5.5B | ||
Debt Instrument [Line Items] | ||
Carrying Value | 5,495,000,000 | |
Debt Issuance Cost | $ (21,000,000) |
Debt - Additional Information (
Debt - Additional Information (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | Jan. 07, 2014 | Mar. 17, 2014 | Nov. 30, 2006 | Sep. 30, 2015 | Sep. 30, 2015 | Feb. 27, 2020 | Nov. 06, 2015 | Mar. 23, 2015 | Feb. 27, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Jun. 30, 2013 | Jan. 07, 2013 | Jun. 30, 2012 | Dec. 31, 2010 | Nov. 13, 2006 |
Commercial Paper | $ 1,970 | $ 1,970 | $ 0 | |||||||||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 2,500 | |||||||||||||||
line of credit available increase to credit facility | $ 1,000 | |||||||||||||||
Convertible Senior Notes 2013 | ||||||||||||||||
Senior Notes | $ 1,725 | |||||||||||||||
Stated interest rate | 1.75% | |||||||||||||||
Cash payment to noteholders for outstanding principal of converted Notes | $ 1,700 | |||||||||||||||
Shares issued to noteholders for the excess of the conversion value over the principal amount of converted Notes (in shares) | 35 | |||||||||||||||
Value of the conversion value over the principal amount of converted Notes | $ 858 | |||||||||||||||
Observation period | 20 days | |||||||||||||||
Convertible conversion ratio | 62.6978 | |||||||||||||||
Conversion premium | 26.50% | |||||||||||||||
Conversion price per share | $ 15.95 | |||||||||||||||
Purchased Options | ||||||||||||||||
Purchased Options Remaining | 108 | |||||||||||||||
Purchased options shares received | 35 | |||||||||||||||
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 | |||||||||||||||
Conversion premium based on the closing price | 53.00% | |||||||||||||||
Closing price per share | $ 12.61 | |||||||||||||||
Warrant | ||||||||||||||||
Warrants exercised | $ 109 | |||||||||||||||
Exercised Warrants | ||||||||||||||||
Shares issues for exercised warrants | 29 | |||||||||||||||
Long-term Debt | ||||||||||||||||
Unamortized discount | $ 5 | $ 5 | ||||||||||||||
Effective interest rate | 2.55% | 2.55% | ||||||||||||||
Long-term Debt | ||||||||||||||||
Long term debt, aggregate principal | $ 5,500 | |||||||||||||||
Interest Rate Swap | ||||||||||||||||
Aggregate notional amount of interest rate swap contracts designated as cash flow hedges | $ 900 | |||||||||||||||
Losses on swaps at time of settlement, deferred | $ 176 | |||||||||||||||
Losses reclassified from other comprehensive income and recognized as interest expense | $ 6 | $ 17 | ||||||||||||||
Commercial Paper | ||||||||||||||||
Commercial Paper Maximum Borrowing Amount | $ 2,500 | |||||||||||||||
Short-term Debt, Terms | The Commercial Paper will have maturities of up to 397 days from the date of issue | |||||||||||||||
Short-term Debt, Weighted Average Interest Rate | 0.24% | 0.24% | ||||||||||||||
Minimum | Commercial Paper | ||||||||||||||||
Short-term Debt, Terms | 34 | |||||||||||||||
Maximum | Commercial Paper | ||||||||||||||||
Short-term Debt, Terms | 80 | |||||||||||||||
Scenario, Forecast | ||||||||||||||||
Line of Credit Facility, Expiration Date | Feb. 27, 2020 | |||||||||||||||
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 | |||||||||||||||
Subsequent Event | ||||||||||||||||
Line of Credit, Current | $ 600 | |||||||||||||||
Subsequent Event | Commercial Paper | ||||||||||||||||
Commercial Paper | $ 2,000 |
Fair Value of Financial Asset46
Fair Value of Financial Assets and Liabilities - Composition of Investments (Detail) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
U.S. government and agency obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $ 2,376 | $ 1,951 |
Unrealized Gains | 5 | 2 |
Unrealized (Losses) | (1) | (2) |
Aggregate Fair Value | 2,380 | 1,951 |
U.S. corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 2,549 | 1,998 |
Unrealized Gains | 4 | 1 |
Unrealized (Losses) | (5) | (4) |
Aggregate Fair Value | 2,548 | 1,995 |
High yield corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 370 | 570 |
Unrealized Gains | 2 | 9 |
Unrealized (Losses) | (22) | (16) |
Aggregate Fair Value | 350 | 563 |
Asset-backed securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 30 | 53 |
Unrealized Gains | 0 | 0 |
Unrealized (Losses) | 0 | 0 |
Aggregate Fair Value | 30 | 53 |
Municipal obligations | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 850 | 948 |
Unrealized Gains | 2 | 2 |
Unrealized (Losses) | 0 | 0 |
Aggregate Fair Value | 852 | 950 |
Auction rate securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 27 | 29 |
Unrealized Gains | 0 | 0 |
Unrealized (Losses) | (2) | (2) |
Aggregate Fair Value | 25 | 27 |
Foreign debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 2,559 | 2,566 |
Unrealized Gains | 3 | 2 |
Unrealized (Losses) | (8) | (4) |
Aggregate Fair Value | 2,554 | 2,564 |
Fixed income securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 8,761 | 8,115 |
Unrealized Gains | 16 | 16 |
Unrealized (Losses) | (38) | (28) |
Aggregate Fair Value | 8,739 | 8,103 |
Publicly traded equity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 178 | 117 |
Unrealized Gains | 52 | 103 |
Unrealized (Losses) | (9) | (11) |
Aggregate Fair Value | 221 | 209 |
Fixed income and publicly traded equity securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 8,939 | 8,232 |
Unrealized Gains | 68 | 119 |
Unrealized (Losses) | (47) | (39) |
Aggregate Fair Value | $ 8,960 | $ 8,312 |
Fair Value of Financial Asset47
Fair Value of Financial Assets and Liabilities - Fair Value Hierarchy For Financial Assets And Liabilities Measured At Fair Value (Detail) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | $ 14,284 | $ 14,655 |
Investment in joint venture | 38 | 37 |
Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 6,532 | 7,082 |
Investment in joint venture | 0 | 0 |
Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 7,727 | 7,546 |
Investment in joint venture | 0 | 0 |
Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 25 | 27 |
Investment in joint venture | 38 | 37 |
Cash | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 1,643 | 2,022 |
Cash | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 1,643 | 2,022 |
Cash | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
Cash | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
Cash equivalents | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 3,681 | 4,321 |
Cash equivalents | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 3,264 | 3,710 |
Cash equivalents | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 417 | 611 |
Cash equivalents | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
U.S. government and agency obligations | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 2,380 | 1,951 |
U.S. government and agency obligations | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 1,404 | 1,141 |
U.S. government and agency obligations | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 976 | 810 |
U.S. government and agency obligations | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
U.S. corporate debt securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 2,548 | 1,995 |
U.S. corporate debt securities | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
U.S. corporate debt securities | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 2,548 | 1,995 |
U.S. corporate debt securities | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
High yield corporate debt securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 350 | 563 |
High yield corporate debt securities | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
High yield corporate debt securities | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 350 | 563 |
High yield corporate debt securities | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
Asset-backed securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 30 | 53 |
Asset-backed securities | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
Asset-backed securities | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 30 | 53 |
Asset-backed securities | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
Municipal obligations | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 852 | 950 |
Municipal obligations | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
Municipal obligations | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 852 | 950 |
Municipal obligations | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
Auction rate securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 25 | 27 |
Auction rate securities | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
Auction rate securities | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
Auction rate securities | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 25 | 27 |
Foreign debt securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 2,554 | 2,564 |
Foreign debt securities | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
Foreign debt securities | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 2,554 | 2,564 |
Foreign debt securities | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
Publicly traded equity securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 221 | 209 |
Publicly traded equity securities | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 221 | 209 |
Publicly traded equity securities | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
Publicly traded equity securities | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total cash and investments | 0 | 0 |
Strategic investments held at cost | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cost method strategic investments | 382 | 333 |
Strategic investments held at cost | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cost method strategic investments | 0 | 0 |
Strategic investments held at cost | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cost method strategic investments | 0 | 0 |
Strategic investments held at cost | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cost method strategic investments | 382 | 333 |
Long-term debt carried at discounted cost | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt carried at discounted cost | (5,514) | (5,544) |
Long-term debt carried at discounted cost | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt carried at discounted cost | 0 | 0 |
Long-term debt carried at discounted cost | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt carried at discounted cost | (5,514) | (5,544) |
Long-term debt carried at discounted cost | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt carried at discounted cost | 0 | 0 |
Foreign Exchange Contract | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign exchange derivative assets | 49 | 44 |
Foreign exchange derivative liabilities | (47) | (71) |
Foreign Exchange Contract | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign exchange derivative assets | 0 | 0 |
Foreign exchange derivative liabilities | 0 | 0 |
Foreign Exchange Contract | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign exchange derivative assets | 49 | 44 |
Foreign exchange derivative liabilities | (47) | (71) |
Foreign Exchange Contract | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign exchange derivative assets | 0 | 0 |
Foreign exchange derivative liabilities | 0 | 0 |
Commodity Contract | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign exchange derivative assets | 12 | |
Foreign exchange derivative liabilities | (4) | |
Commodity Contract | Fair Value, Inputs, Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign exchange derivative assets | 0 | |
Foreign exchange derivative liabilities | 0 | |
Commodity Contract | Fair Value, Inputs, Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign exchange derivative assets | 12 | |
Foreign exchange derivative liabilities | (4) | |
Commodity Contract | Fair Value, Inputs, Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign exchange derivative assets | $ 0 | |
Foreign exchange derivative liabilities | $ 0 |
Fair Value of Financial Asset48
Fair Value of Financial Assets and Liabilities - Unrealized Losses on Investments by Investment Category and Length of Time in Continuous Unrealized Loss Position (Detail) $ in Millions | Sep. 30, 2015USD ($) |
Gain (Loss) on Investments [Line Items] | |
Less Than 12 Months Fair Value | $ 2,885 |
Less than 12 Months Gross Unrealized Losses | (32) |
12 Months or Greater Fair Value | 74 |
12 Months or Greater Gross Unrealized Losses | (15) |
Total Fair Value | 2,959 |
Total, Gross Unrealized Losses | (47) |
U.S. government and agency obligations | |
Gain (Loss) on Investments [Line Items] | |
Less Than 12 Months Fair Value | 321 |
Less than 12 Months Gross Unrealized Losses | (1) |
12 Months or Greater Fair Value | 0 |
12 Months or Greater Gross Unrealized Losses | 0 |
Total Fair Value | 321 |
Total, Gross Unrealized Losses | (1) |
U.S. corporate debt securities | |
Gain (Loss) on Investments [Line Items] | |
Less Than 12 Months Fair Value | 1,103 |
Less than 12 Months Gross Unrealized Losses | (5) |
12 Months or Greater Fair Value | 0 |
12 Months or Greater Gross Unrealized Losses | 0 |
Total Fair Value | 1,103 |
Total, Gross Unrealized Losses | (5) |
High yield corporate debt securities | |
Gain (Loss) on Investments [Line Items] | |
Less Than 12 Months Fair Value | 239 |
Less than 12 Months Gross Unrealized Losses | (17) |
12 Months or Greater Fair Value | 30 |
12 Months or Greater Gross Unrealized Losses | (5) |
Total Fair Value | 269 |
Total, Gross Unrealized Losses | (22) |
Auction rate securities | |
Gain (Loss) on Investments [Line Items] | |
Less Than 12 Months Fair Value | 0 |
Less than 12 Months Gross Unrealized Losses | 0 |
12 Months or Greater Fair Value | 25 |
12 Months or Greater Gross Unrealized Losses | (2) |
Total Fair Value | 25 |
Total, Gross Unrealized Losses | (2) |
Foreign debt securities | |
Gain (Loss) on Investments [Line Items] | |
Less Than 12 Months Fair Value | 1,220 |
Less than 12 Months Gross Unrealized Losses | (8) |
12 Months or Greater Fair Value | 0 |
12 Months or Greater Gross Unrealized Losses | 0 |
Total Fair Value | 1,220 |
Total, Gross Unrealized Losses | (8) |
Publicly traded equity securities | |
Gain (Loss) on Investments [Line Items] | |
Less Than 12 Months Fair Value | 2 |
Less than 12 Months Gross Unrealized Losses | (1) |
12 Months or Greater Fair Value | 19 |
12 Months or Greater Gross Unrealized Losses | (8) |
Total Fair Value | 21 |
Total, Gross Unrealized Losses | $ (9) |
Fair Value of Financial Asset49
Fair Value of Financial Assets and Liabilities - Contractual Maturities of Investments (Detail) - Fixed income securities - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Amortized Cost Basis | ||
Due within one year | $ 2,302 | |
Due after 1 year through 5 years | 5,618 | |
Due after 5 years through 10 years | 523 | |
Due after 10 years | 318 | |
Amortized Cost | 8,761 | $ 8,115 |
Aggregate Fair Value | ||
Due within one year | 2,303 | |
Due after 1 year through 5 years | 5,617 | |
Due after 5 years through 10 years | 503 | |
Due after 10 years | 316 | |
Aggregate Fair Value | $ 8,739 | $ 8,103 |
Fair Value of Financial Asset50
Fair Value of Financial Assets and Liabilities - Additional Information (Detail) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2015USD ($) | Sep. 30, 2014 | Sep. 30, 2015USD ($)Security | Sep. 30, 2014 | Dec. 31, 2012 | Dec. 31, 2014USD ($) | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Short-term investments | $ 2,318 | $ 2,318 | $ 1,978 | |||
Foreign debt securities | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Available-for-sale Securities | $ 2,554 | $ 2,554 | 2,564 | |||
Average credit rating | A+ | |||||
Foreign Sovereign Debt Securities | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Average credit rating | AA+ | |||||
Percentage of securities | 4.00% | 4.00% | ||||
Auction rate securities | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Available-for-sale Securities | $ 25 | $ 25 | $ 27 | |||
Average credit rating | AA | |||||
Change in fair value of level 3 investment | no material changes | no material changes | no material changes | no material changes | ||
Number of auction rate securities | Security | 1 | |||||
Auction rate securities that have partial guarantees by the U.S. government, market value | $ 6 | $ 6 | ||||
Percentage of loans guaranteed | 95.00% | 95.00% | ||||
Coupon rate used to estimate fair value of investments - Start Range | 0.00% | |||||
Coupon rate used to estimate fair value of investments - End Range | 2.00% | |||||
Discount rate used to estimate fair value of investments | 1.00% | |||||
The rate used for the discount margin to determine the estimated fair value of investment in auction rate securities | 1.00% | 1.00% | 1.00% | |||
Fair value input, discounted cash flow, term | 5 years | |||||
Variable Rate Demand Note | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Short-term investments | $ 15 | $ 15 | ||||
LenovoEMC [Member] | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Change in fair value of level 3 investment | no material changes | no material changes | no material changes | no material changes | ||
Discount rate used to estimate fair value of investments | 6.00% | |||||
Ownership percentage, joint venture | 49.00% | 49.00% | ||||
Fair value input, discounted cash flow, term | 3 years |
Inventories - Components of Inv
Inventories - Components of Inventories (Detail) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Inventory Disclosure [Abstract] | ||
Work-in-process | $ 580 | $ 627 |
Finished goods | 644 | 649 |
Inventory, Net, Total | $ 1,224 | $ 1,276 |
Accounts and Notes Receivable52
Accounts and Notes Receivable and Allowance for Credit Losses - Contractual Amounts Due under Leases (Detail) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Receivables [Abstract] | ||
Due within one year | $ 65 | |
Due within two years | 45 | |
Due within three years | 31 | |
Thereafter | 1 | |
Total | 142 | $ 233 |
Less: Amounts representing interest | 5 | |
Present value | 137 | |
Current portion (included in accounts and notes receivable) | 62 | |
Long-term portion (included in other assets, net) | $ 75 |
Accounts and Notes Receivable53
Accounts and Notes Receivable and Allowance for Credit Losses - Additional Information (Detail) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Nov. 09, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||||
Accounts Receivable, Additional Narrative Disclosure | no material changes | no material changes | no material changes | no material changes | ||
Gross lease receivables | $ 142 | $ 142 | $ 233 | |||
Subsequent Event | ||||||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||||||
Sales of leases to third parties without recourse | $ 23 |
Property, Plant and Equipment -
Property, Plant and Equipment - Components of Property, Plant and Equipment (Detail) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 10,180 | $ 9,543 |
Accumulated depreciation | (6,389) | (5,777) |
Property, plant and equipment, net | 3,791 | 3,766 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 280 | 255 |
Equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 7,305 | 6,684 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 2,357 | 2,308 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 170 | 162 |
Building construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 68 | $ 134 |
Facilities not yet placed in service, holding for future use | ||
Property, Plant and Equipment [Line Items] | ||
Building construction in progress | $ 39 |
Accrued Expenses - Components o
Accrued Expenses - Components of Accrued Expenses (Detail) - USD ($) $ in Millions | Sep. 30, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Dec. 31, 2013 |
Payables and Accruals [Abstract] | ||||||
Salaries and benefits | $ 1,075 | $ 1,251 | ||||
Product warranties | 180 | $ 189 | 207 | $ 227 | $ 254 | $ 286 |
Dividends payable (see Note 11) | 232 | 237 | ||||
Partner rebates | 204 | 235 | ||||
Restructuring, current (See Note 12) | 162 | 123 | ||||
Derivatives | 51 | 75 | ||||
Other | 927 | 1,013 | ||||
Accrued Liabilities, Current, Total | $ 2,831 | $ 3,141 |
Accrued Expenses - Activity in
Accrued Expenses - Activity in Warranty Accrual for Product Warranty (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||||
Balance, beginning of the period | $ 189 | $ 254 | $ 207 | $ 286 |
Provision | 32 | 32 | 109 | 107 |
Amounts charged against the accrual | (41) | (59) | (136) | (166) |
Balance, end of the period | $ 180 | $ 227 | $ 180 | $ 227 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rates | 24.10% | 24.70% | 23.90% | 24.00% |
Shareholders' Equity - Reconcil
Shareholders' Equity - Reconciliation from Basic To Diluted Earnings Per Share for both Numerators and Denominators (Detail) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Numerator: | ||||
Net income attributable to EMC Corporation | $ 480 | $ 587 | $ 1,219 | $ 1,568 |
Incremental dilution from VMware | (1) | (1) | (3) | (4) |
Net income – dilution attributable to EMC Corporation | $ 479 | $ 586 | $ 1,216 | $ 1,564 |
Denominator: | ||||
Weighted average shares, basic | 1,934 | 2,032 | 1,945 | 2,033 |
Weighted common stock equivalents | 14 | 25 | 18 | 26 |
Assumed conversion of the 2013 Notes and associated warrants | 0 | 0 | 0 | 6 |
Weighted average shares, diluted | 1,948 | 2,057 | 1,963 | 2,065 |
Shareholders' Equity - Dividend
Shareholders' Equity - Dividends Declared (Details) - USD ($) $ / shares in Units, $ in Millions | Jul. 30, 2015 | May. 20, 2015 | Feb. 27, 2015 | Dec. 09, 2014 | Jul. 30, 2014 | Apr. 17, 2014 | Feb. 06, 2014 | May. 30, 2013 |
Declaration Date | Jul. 30, 2015 | May 20, 2015 | Feb. 27, 2015 | Dec. 9, 2014 | Jul. 30, 2014 | Apr. 17, 2014 | Feb. 6, 2014 | |
Dividend Per Share (in usd per share) | $ 0.115 | $ 0.115 | $ 0.115 | $ 0.115 | $ 0.115 | $ 0.115 | $ 0.10 | $ 0.10 |
Record Date | Oct. 1, 2015 | Jul. 1, 2015 | Apr. 1, 2015 | Jan. 2, 2015 | Oct. 1, 2014 | Jul. 1, 2014 | Apr. 1, 2014 | |
Dividends, Common Stock, Cash | $ 229 | $ 226 | $ 229 | $ 234 | $ 239 | $ 237 | $ 209 | |
Payment Date | Oct. 23, 2015 | Jul. 23, 2015 | Apr. 23, 2015 | Jan. 23, 2015 | Oct. 23, 2014 | Jul. 23, 2014 | Apr. 23, 2014 |
Shareholders' Equity - Accumula
Shareholders' Equity - Accumulated Other Comprehensive Loss, Net of Tax (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Beginning balance | $ (366) | $ (239) | $ (239) | |||
Other comprehensive income (loss) before reclassifications | (133) | 63 | ||||
Net losses (gains) reclassified from accumulated other comprehensive income | (34) | (22) | ||||
Net current period other comprehensive income (loss) | (167) | 41 | ||||
Ending balance | $ (533) | $ (198) | (533) | (198) | (366) | $ (239) |
Taxes (benefits) | 168 | 206 | 420 | 532 | ||
Foreign Currency Translation Adjustments | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Beginning balance | (187) | (53) | (53) | |||
Other comprehensive income (loss) before reclassifications | (137) | (57) | ||||
Net losses (gains) reclassified from accumulated other comprehensive income | 0 | 0 | ||||
Net current period other comprehensive income (loss) | (137) | (57) | ||||
Ending balance | (324) | (110) | (324) | (110) | (187) | (53) |
Unrealized Net Gains on Investments | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Beginning balance | 49 | 31 | 31 | |||
Other comprehensive income (loss) before reclassifications | (10) | 107 | ||||
Net losses (gains) reclassified from accumulated other comprehensive income | (26) | (19) | ||||
Net current period other comprehensive income (loss) | (36) | 88 | ||||
Ending balance | 13 | 119 | 13 | 119 | 49 | 31 |
Taxes (benefits) | 8 | 72 | 31 | 18 | ||
Unrealized Net Losses on Derivatives | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Beginning balance | (99) | (106) | (106) | |||
Other comprehensive income (loss) before reclassifications | 11 | 11 | ||||
Net losses (gains) reclassified from accumulated other comprehensive income | (8) | (2) | ||||
Net current period other comprehensive income (loss) | 3 | 9 | ||||
Ending balance | (96) | (97) | (96) | (97) | (99) | (106) |
Taxes (benefits) | (58) | (63) | (64) | (66) | ||
Recognition of Actuarial Net Loss from Pension and Other Postretirement Plans | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Beginning balance | (126) | (110) | (110) | |||
Other comprehensive income (loss) before reclassifications | 0 | 2 | ||||
Net losses (gains) reclassified from accumulated other comprehensive income | 0 | (1) | ||||
Net current period other comprehensive income (loss) | 0 | 1 | ||||
Ending balance | (126) | (109) | (126) | (109) | (126) | (110) |
Taxes (benefits) | (70) | (61) | (70) | (61) | ||
Accumulated Other Comprehensive Income Attributable to the Non-controlling Interest in VMware, Inc. | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward] | ||||||
Beginning balance | (3) | (1) | (1) | |||
Other comprehensive income (loss) before reclassifications | 3 | 0 | ||||
Net losses (gains) reclassified from accumulated other comprehensive income | 0 | 0 | ||||
Net current period other comprehensive income (loss) | 3 | 0 | ||||
Ending balance | $ 0 | $ (1) | $ 0 | $ (1) | $ (3) | $ (1) |
Shareholders' Equity - Reclassi
Shareholders' Equity - Reclassification Out of Accumulated Other Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | |
Reclassification out of Accumulated Other Comprehensive Income | ||||||
Investment income | $ 25 | $ 29 | $ 76 | $ 100 | ||
Product sales revenue | 3,269 | 3,400 | 9,399 | 9,728 | ||
Cost of product sales | (1,379) | (1,400) | (4,141) | (4,068) | ||
Other interest expense | (41) | (40) | (121) | (108) | ||
Income (loss) before provision for income taxes | 696 | 833 | 1,759 | 2,213 | ||
Provision for income tax | (168) | (206) | (420) | (532) | ||
Net income | 528 | 627 | 1,339 | 1,681 | ||
Net gain on investments | ||||||
Reclassification out of Accumulated Other Comprehensive Income | ||||||
Provision for income tax | (8) | (72) | $ (31) | $ (18) | ||
Net gain on derivatives | ||||||
Reclassification out of Accumulated Other Comprehensive Income | ||||||
Provision for income tax | 58 | 63 | 64 | 66 | ||
Net gains from pension and other postretirement plans | ||||||
Reclassification out of Accumulated Other Comprehensive Income | ||||||
Provision for income tax | 70 | 61 | $ 70 | $ 61 | ||
Reclassification Out of Accumulated Other Comprehensive Income | Net gains from pension and other postretirement plans | ||||||
Reclassification out of Accumulated Other Comprehensive Income | ||||||
Provision for income tax | 0 | 0 | 0 | 0 | ||
Net income | 0 | 1 | 0 | 1 | ||
Other Cost and Expense, Operating | 0 | 1 | 0 | (1) | ||
Foreign Exchange Contract | Reclassification Out of Accumulated Other Comprehensive Income | Net gain on derivatives | ||||||
Reclassification out of Accumulated Other Comprehensive Income | ||||||
Product sales revenue | 1 | 12 | 22 | 15 | ||
Cost of product sales | 0 | (7) | (1) | (7) | ||
Income (loss) before provision for income taxes | (5) | (1) | 4 | 2 | ||
Provision for income tax | 2 | 0 | 4 | 0 | ||
Net income | (3) | (1) | 8 | 2 | ||
Interest Rate Swap | Reclassification Out of Accumulated Other Comprehensive Income | Net gain on interest rate swap | ||||||
Reclassification out of Accumulated Other Comprehensive Income | ||||||
Other interest expense | (6) | (6) | (17) | (6) | ||
Unrealized Gain on Investments | Reclassification Out of Accumulated Other Comprehensive Income | Net gain on investments | ||||||
Reclassification out of Accumulated Other Comprehensive Income | ||||||
Investment income | 8 | 13 | 42 | 30 | ||
Provision for income tax | 3 | 5 | 16 | 11 | ||
Net income | $ 5 | $ 8 | $ 26 | $ 19 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | 31 Months Ended | |||||
Mar. 17, 2014 | Nov. 30, 2006 | Sep. 30, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Jan. 27, 2015 | Dec. 01, 2014 | Feb. 28, 2013 | |
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 | 19,000,000 | 7,000,000 | 3,000,000 | ||||||
Repurchases of Common Stock, shares authorized to repurchase | 500,000,000 | 500,000,000 | 500,000,000 | 250,000,000 | 250,000,000 | ||||
Total Repurchases of Common Stock, cost | $ 2,000 | $ 7,400 | |||||||
Total Repurchases of Common Stock, shares | 76,000,000 | 277,000,000 | |||||||
Shares authorized for future repurchases | 223,000,000 | 223,000,000 | 223,000,000 | ||||||
Payments for Repurchase of Common Stock | $ 2,063 | $ 1,374 | |||||||
Sold Warrants | |||||||||
Sold warrants to acquire shares of our common stock | 215,000,000 | ||||||||
Warrant | |||||||||
Warrants exercised | $ 109 | ||||||||
Exercised Warrants | |||||||||
Conversion of Stock, Shares Issued | 29,000,000 | ||||||||
VMware | |||||||||
Total Repurchases of Common Stock, shares | 13,000,000 | ||||||||
Payments for Repurchase of Common Stock | $ 1,050 | $ 450 | |||||||
Stock Repurchase Program, Authorized Amount | $ 1,000 | ||||||||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 910 | $ 910 | $ 910 |
Restructuring and Acquisition63
Restructuring and Acquisition-Related Charges - Activity For Restructuring Program (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Restructuring Reserve [Roll Forward] | ||||
Charges/ Adjustments to the Provision | $ 66 | $ 31 | $ 200 | $ 175 |
EMC Information Infrastructure | Restructuring 2014 Programs | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 101 | 0 | ||
Charges/ Adjustments to the Provision | 32 | 186 | ||
Restructuring Reserve Settled During Period | (35) | (88) | ||
Ending Balance | 98 | 98 | ||
EMC Information Infrastructure | Restructuring 2014 Programs | Workforce reductions | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 98 | 0 | ||
Charges/ Adjustments to the Provision | 30 | 179 | ||
Restructuring Reserve Settled During Period | (33) | (84) | ||
Ending Balance | 95 | 95 | ||
EMC Information Infrastructure | Restructuring 2014 Programs | Consolidation of excess facilities and other contractual obligations | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 3 | 0 | ||
Charges/ Adjustments to the Provision | 2 | 7 | ||
Restructuring Reserve Settled During Period | (2) | (4) | ||
Ending Balance | 3 | 3 | ||
EMC Information Infrastructure | Restructuring 2015 Programs | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 101 | 0 | ||
Charges/ Adjustments to the Provision | 68 | 208 | ||
Restructuring Reserve Settled During Period | (36) | (75) | ||
Ending Balance | 133 | 133 | ||
EMC Information Infrastructure | Restructuring 2015 Programs | Workforce reductions | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 89 | 0 | ||
Charges/ Adjustments to the Provision | 62 | 185 | ||
Restructuring Reserve Settled During Period | (33) | (67) | ||
Ending Balance | 118 | 118 | ||
EMC Information Infrastructure | Restructuring 2015 Programs | Consolidation of excess facilities and other contractual obligations | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 12 | 0 | ||
Charges/ Adjustments to the Provision | 6 | 23 | ||
Restructuring Reserve Settled During Period | (3) | (8) | ||
Ending Balance | 15 | 15 | ||
EMC Information Infrastructure | Restructuring Other Programs | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 56 | 35 | 121 | 90 |
Restructuring Reserve, Accrual Adjustment | (2) | (1) | (8) | (11) |
Restructuring Reserve Settled During Period | (15) | (7) | (74) | (52) |
Ending Balance | 39 | 27 | 39 | 27 |
EMC Information Infrastructure | Restructuring Other Programs | Workforce reductions | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 43 | 17 | 102 | 66 |
Restructuring Reserve, Accrual Adjustment | (1) | (1) | (7) | (14) |
Restructuring Reserve Settled During Period | (14) | (6) | (67) | (42) |
Ending Balance | 28 | 10 | 28 | 10 |
EMC Information Infrastructure | Restructuring Other Programs | Consolidation of excess facilities and other contractual obligations | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 13 | 18 | 19 | 24 |
Charges/ Adjustments to the Provision | (1) | 0 | (1) | 3 |
Restructuring Reserve Settled During Period | (1) | (1) | (7) | (10) |
Ending Balance | 11 | 17 | 11 | 17 |
VMware | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring Reserve, Accrual Adjustment | $ 6 | $ 4 | ||
Charges/ Adjustments to the Provision | 20 | |||
VMware | Restructuring Other Programs | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 8 | |||
Charges/ Adjustments to the Provision | 20 | |||
Restructuring Reserve Settled During Period | (27) | |||
Ending Balance | 1 | 1 | ||
VMware | Restructuring Other Programs | Workforce reductions | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 8 | |||
Charges/ Adjustments to the Provision | 20 | |||
Restructuring Reserve Settled During Period | (27) | |||
Ending Balance | 1 | 1 | ||
VMware | Restructuring Other Programs | Consolidation of excess facilities and other contractual obligations | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning Balance | 0 | |||
Charges/ Adjustments to the Provision | 0 | |||
Restructuring Reserve Settled During Period | 0 | |||
Ending Balance | $ 0 | $ 0 |
Restructuring and Acquisition64
Restructuring and Acquisition-Related Charges - Additional information (Detail) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||
Sep. 30, 2015USD ($)position | Jun. 30, 2015position | Mar. 31, 2015position | Sep. 30, 2014USD ($)position | Jun. 30, 2014position | Mar. 31, 2014position | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Dec. 31, 2014position | |
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring and acquisition-related charges | $ 68 | $ 39 | $ 226 | $ 187 | |||||
Restructuring charges | 66 | 31 | 200 | 175 | |||||
Acquisition-related charges | 1 | 2 | 4 | 3 | |||||
Lease termination costs for facilities | 5 | 2 | 22 | 10 | |||||
VMware | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring charges | 20 | ||||||||
Acquisition-related charges | $ 1 | $ 2 | 5 | ||||||
Restructuring Reserve, Accrual Adjustment | $ 6 | $ 4 | |||||||
Restructuring 2015 Programs | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring and Related Cost, Number of Positions Eliminated | position | 680 | 160 | 1,320 | ||||||
Restructuring 2015 Programs | VMware | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring and Related Cost, Number of Positions Eliminated | position | 350 | ||||||||
Restructuring 2014 Programs | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring and Related Cost, Number of Positions Eliminated | position | 240 | 210 | 1,320 | 2,100 | |||||
Restructuring 2014 Programs | VMware | |||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||
Restructuring and Related Cost, Number of Positions Eliminated | position | 90 |
Commitments and Contingencies C
Commitments and Contingencies Commitments and Contingencies (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2015USD ($) | |
VMware | |
Other Commitments [Line Items] | |
Litigation Settlement, Amount | $ 76 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2015USD ($)Country | Sep. 30, 2014Country | Sep. 30, 2015USD ($)Countrysegment | Sep. 30, 2014Country | Dec. 31, 2014USD ($)Country | |
United States | |||||
Segment Reporting Information [Line Items] | |||||
Long-lived assets, excluding financial instruments, deferred tax assets, goodwill and intangible assets | $ | $ 4,496 | $ 4,496 | $ 4,355 | ||
International | |||||
Segment Reporting Information [Line Items] | |||||
Long-lived assets, excluding financial instruments, deferred tax assets, goodwill and intangible assets | $ | $ 985 | $ 985 | $ 1,021 | ||
Geographic Concentration | Sales Revenue, Segment | |||||
Segment Reporting Information [Line Items] | |||||
Number of countries other than the US that accounted for 10% or more | 0 | 0 | 0 | 0 | |
Geographic Concentration | Long-lived Assets, Total | |||||
Segment Reporting Information [Line Items] | |||||
Number of countries other than the US that accounted for 10% or more | 0 | 0 | |||
EMC Information Infrastructure | |||||
Segment Reporting Information [Line Items] | |||||
Number of operating segments | segment | 3 |
Segment information (Detail)
Segment information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenues: | ||||
Product revenues | $ 3,269 | $ 3,400 | $ 9,399 | $ 9,728 |
Services revenues | 2,810 | 2,632 | 8,290 | 7,663 |
Total consolidated revenues | 6,079 | 6,032 | 17,689 | 17,391 |
Gross profit | $ 3,705 | $ 3,743 | $ 10,631 | $ 10,744 |
Gross profit percentage | 60.90% | 62.00% | 60.10% | 61.80% |
Research and development | $ 802 | $ 767 | $ 2,372 | $ 2,239 |
Selling, general and administrative | 2,145 | 1,990 | 6,285 | 5,852 |
Restructuring and acquisition-related charges | 68 | 39 | 226 | 187 |
Total operating expenses | 3,015 | 2,796 | 8,883 | 8,278 |
Operating income (expense) | 690 | 947 | 1,748 | 2,466 |
Non-operating income (expense), net | 6 | (114) | 11 | (253) |
Income tax provision | 168 | 206 | 420 | 532 |
Net income | 528 | 627 | 1,339 | 1,681 |
Less: Net income attributable to the non-controlling interest in VMware, Inc. | (48) | (40) | (120) | (113) |
Net income attributable to EMC Corporation | 480 | 587 | 1,219 | 1,568 |
EMC Information Infrastructure | ||||
Revenues: | ||||
Product revenues | 2,567 | 2,745 | 7,519 | 7,878 |
Services revenues | 1,781 | 1,721 | 5,299 | 5,043 |
Total consolidated revenues | 4,348 | 4,466 | 12,818 | 12,921 |
Gross profit | $ 2,331 | $ 2,511 | $ 6,792 | $ 7,202 |
Gross profit percentage | 53.60% | 56.20% | 53.00% | 55.70% |
Research and development | $ 397 | $ 372 | $ 1,219 | $ 1,106 |
Selling, general and administrative | 1,220 | 1,146 | 3,591 | 3,388 |
Restructuring and acquisition-related charges | 0 | 0 | 0 | 0 |
Total operating expenses | 1,617 | 1,518 | 4,810 | 4,494 |
Operating income (expense) | 714 | 993 | 1,982 | 2,708 |
Pivotal | ||||
Revenues: | ||||
Product revenues | 22 | 17 | 57 | 43 |
Services revenues | 45 | 41 | 128 | 118 |
Total consolidated revenues | 67 | 58 | 185 | 161 |
Gross profit | $ 24 | $ 27 | $ 71 | $ 71 |
Gross profit percentage | 36.20% | 46.90% | 38.70% | 44.30% |
Research and development | $ 28 | $ 33 | $ 79 | $ 98 |
Selling, general and administrative | 54 | 46 | 156 | 133 |
Restructuring and acquisition-related charges | 0 | 0 | 0 | 0 |
Total operating expenses | 82 | 79 | 235 | 231 |
Operating income (expense) | (58) | (52) | (164) | (160) |
EMC Information Infrastructure Plus Pivotal | ||||
Revenues: | ||||
Product revenues | 2,589 | 2,762 | 7,576 | 7,921 |
Services revenues | 1,826 | 1,762 | 5,427 | 5,161 |
Total consolidated revenues | 4,415 | 4,524 | 13,003 | 13,082 |
Gross profit | $ 2,355 | $ 2,538 | $ 6,863 | $ 7,273 |
Gross profit percentage | 53.30% | 56.10% | 52.80% | 55.60% |
Research and development | $ 425 | $ 405 | $ 1,298 | $ 1,204 |
Selling, general and administrative | 1,274 | 1,192 | 3,747 | 3,521 |
Restructuring and acquisition-related charges | 0 | 0 | 0 | 0 |
Total operating expenses | 1,699 | 1,597 | 5,045 | 4,725 |
Operating income (expense) | 656 | 941 | 1,818 | 2,548 |
Non-operating income (expense), net | 2 | (120) | 7 | (285) |
Income tax provision | 185 | 207 | 494 | 584 |
Net income | 473 | 614 | 1,331 | 1,679 |
Less: Net income attributable to the non-controlling interest in VMware, Inc. | 0 | 0 | 0 | 0 |
Net income attributable to EMC Corporation | 473 | 614 | 1,331 | 1,679 |
VMware Virtual Infrastructure within EMC | ||||
Revenues: | ||||
Product revenues | 680 | 638 | 1,899 | 1,807 |
Services revenues | 984 | 870 | 2,863 | 2,502 |
Total consolidated revenues | 1,664 | 1,508 | 4,762 | 4,309 |
Gross profit | $ 1,451 | $ 1,304 | $ 4,143 | $ 3,761 |
Gross profit percentage | 87.20% | 86.50% | 87.00% | 87.30% |
Research and development | $ 274 | $ 263 | $ 788 | $ 737 |
Selling, general and administrative | 651 | 586 | 1,896 | 1,725 |
Restructuring and acquisition-related charges | 0 | 0 | 0 | 0 |
Total operating expenses | 925 | 849 | 2,684 | 2,462 |
Operating income (expense) | 526 | 455 | 1,459 | 1,299 |
Non-operating income (expense), net | 4 | 6 | 24 | 21 |
Income tax provision | 89 | 99 | 285 | 274 |
Net income | 441 | 362 | 1,198 | 1,046 |
Less: Net income attributable to the non-controlling interest in VMware, Inc. | (77) | (73) | (224) | (211) |
Net income attributable to EMC Corporation | 364 | 289 | 974 | 835 |
Corp Reconciling Items | ||||
Revenues: | ||||
Product revenues | 0 | 0 | (76) | 0 |
Services revenues | 0 | 0 | 0 | 0 |
Total consolidated revenues | 0 | 0 | (76) | 0 |
Gross profit | $ (101) | (99) | (375) | (290) |
Gross profit percentage | 0.00% | |||
Research and development | $ 103 | 99 | 286 | 298 |
Selling, general and administrative | 220 | 212 | 642 | 606 |
Restructuring and acquisition-related charges | 68 | 39 | 226 | 187 |
Total operating expenses | 391 | 350 | 1,154 | 1,091 |
Operating income (expense) | (492) | (449) | (1,529) | (1,381) |
Non-operating income (expense), net | 0 | 0 | (20) | 11 |
Income tax provision | (106) | (100) | (359) | (326) |
Net income | (386) | (349) | (1,190) | (1,044) |
Less: Net income attributable to the non-controlling interest in VMware, Inc. | 29 | 33 | 104 | 98 |
Net income attributable to EMC Corporation | (357) | (316) | (1,086) | (946) |
Information Storage | ||||
Revenues: | ||||
Product revenues | 2,424 | 2,595 | 7,113 | 7,447 |
Services revenues | 1,537 | 1,456 | 4,539 | 4,260 |
Total consolidated revenues | 3,961 | 4,051 | 11,652 | 11,707 |
Gross profit | $ 2,071 | $ 2,238 | $ 6,014 | $ 6,405 |
Gross profit percentage | 52.30% | 55.20% | 51.60% | 54.70% |
Enterprise Content Division | ||||
Revenues: | ||||
Product revenues | $ 37 | $ 36 | $ 103 | $ 108 |
Services revenues | 107 | 118 | 333 | 358 |
Total consolidated revenues | 144 | 154 | 436 | 466 |
Gross profit | $ 97 | $ 100 | $ 291 | $ 300 |
Gross profit percentage | 67.30% | 65.20% | 66.80% | 64.40% |
RSA Information Security | ||||
Revenues: | ||||
Product revenues | $ 106 | $ 114 | $ 303 | $ 323 |
Services revenues | 137 | 147 | 427 | 425 |
Total consolidated revenues | 243 | 261 | 730 | 748 |
Gross profit | $ 163 | $ 173 | $ 487 | $ 497 |
Gross profit percentage | 66.90% | 66.30% | 66.70% | 66.40% |
Segment Information - Revenues
Segment Information - Revenues By Geographic Area (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Segment Reporting Information [Line Items] | ||||
Total consolidated revenues | $ 6,079 | $ 6,032 | $ 17,689 | $ 17,391 |
United States | ||||
Segment Reporting Information [Line Items] | ||||
Total consolidated revenues | 3,318 | 3,212 | 9,602 | 9,102 |
Europe, Middle East and Africa | ||||
Segment Reporting Information [Line Items] | ||||
Total consolidated revenues | 1,630 | 1,672 | 4,811 | 4,933 |
Asia Pacific and Japan | ||||
Segment Reporting Information [Line Items] | ||||
Total consolidated revenues | 787 | 821 | 2,311 | 2,346 |
Latin America, Mexico and Canada | ||||
Segment Reporting Information [Line Items] | ||||
Total consolidated revenues | $ 344 | $ 327 | $ 965 | $ 1,010 |