Dell Technologies Reports Fiscal Year 2018 Second Quarter

Dell Technologies Reports Fiscal Year 2018 Second Quarter Financial Results

This list of risks, uncertainties, and other factors is not complete. Dell Technologies discusses some of these matters more fully, as well as certain risk factors that could affect the Dell Technologies' business, financial condition, results of operations, and prospects, in its reports filed with the Securities and Exchange Commission, including Dell Technologies' Annual Report on Form 10-K for the fiscal year ended February 3, 2017, quarterly reports on Form 10-Q, and current reports on Form 8-K. These filings are available for review through the Securities and Exchange Commission's website at www.sec.gov. Any or all forward-looking statements Dell Technologies makes may turn out to be wrong and can be affected by inaccurate assumptions Dell Technologies might make or by known or unknown risks, uncertainties and other factors, including those identified in this press release. Accordingly, you should not place undue reliance on the forward-looking statements made in this press release, which speak only as of its date. Dell Technologies does not undertake to update, and expressly disclaims any duty to update, its forward-looking statements, whether as a result of circumstances or events that arise after the date they are made, new information, or otherwise.

DELL TECHNOLOGIES INC.
Condensed Consolidated Statements of Income (Loss) and Related Financial Highlights
(in millions, except per share amounts and percentages; unaudited)

	Three Months Ended			Six Months Ended
	August 4, 2017	July 29, 2016	Change	August 4, 2017	July 29, 2016	Change
Net revenue:
Products	$ 14,355	$ 10,961	31 %	$ 27,323	$ 21,144	29 %
Services	4,944	2,119	133 %	9,792	4,177	134 %
Total net revenue	19,299	13,080	48 %	37,115	25,321	47 %

Cost of net revenue:
Products	12,378	9,495	30 %	23,837	18,294	30 %
Services	2,112	1,249	69 %	4,167	2,498	67 %
Total cost of net revenue	14,490	10,744	35 %	28,004	20,792	35 %

Gross margin	4,809	2,336	106 %	9,111	4,529	101 %

Operating expenses:
Selling, general, and administrative	4,695	2,023	132 %	9,364	4,091	129 %
Research and development	1,093	246	344 %	2,226	510	336 %
Total operating expenses	5,788	2,269	155 %	11,590	4,601	152 %

Operating income (loss)	(979)	67	NM	(2,479)	(72)	NM

Interest and other, net	(545)	(349)	(56)%	(1,118)	(568)	(97)%
Loss from continuing operations before income taxes	(1,524)	(282)	(440)%	(3,597)	(640)	(462)%
Income tax provision (benefit)	(546)	(20)	NM	(1,236)	46	NM
Net loss from continuing operations	(978)	(262)	(273)%	(2,361)	(686)	(244)%
Income from discontinued operations, net of income taxes	-	834	NA	-	1,313	NA
Net income (loss)	(978)	572	(271)%	(2,361)	627	(477)%
Less: Net loss attributable to non-controlling interests	(32)	(1)	NM	(81)	(1)	NM
Net income (loss) attributable to Dell Technologies Inc.	$ (946)	$ 573	(265)%	$ (2,280)	$ 628	(463)%

Earnings (loss) per share attributable to Dell Technologies Inc. - basic:
Continuing operations - Class V Common Stock - basic	$ 0.83	$ -		$ 1.40	$ -
Continuing operations - DHI Group - basic	$ (1.97)	$ (0.64)		$ (4.53)	$ (1.69)
Discontinued operations - DHI Group - basic	$ -	$ 2.06		$ -	$ 3.24

Earnings (loss) per share attributable to Dell Technologies Inc. - diluted:
Continuing operations - Class V Common Stock - diluted	$ 0.82	$ -		$ 1.38	$ -
Continuing operations - DHI Group - diluted	$ (1.97)	$ (0.64)		$ (4.54)	$ (1.69)
Discontinued operations - DHI Group - diluted	$ -	$ 2.06		$ -	$ 3.24

Weighted-average shares outstanding:
Basic - Class V Common Stock	203	-		205	-
Diluted - Class V Common Stock	203	-		205	-
Basic - DHI Group	566	405		566	405
Diluted - DHI Group	566	405		566	405

*Percentage of Total Net Revenue:*
Gross margin	25 %	18 %		25 %	18 %
Selling, general, and administrative	24 %	15 %		25 %	16 %
Research and development	6 %	2 %		6 %	2 %
Operating expenses	30 %	17 %		31 %	18 %
Operating income (loss)	(5)%	1 %		(7)%	(0)%
Loss from continuing operations before income taxes	(8)%	(2)%		(10)%	(3)%
Net loss from continuing operations	(5)%	(2)%		(6)%	(3)%

Income tax rate	36 %	7 %		34 %	(7)%

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