EMC CORP

CIK:0000790070|SEC Filings

CONSOLIDATED INCOME STATEMENTS - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Revenues:
Product sales	$ 3,161	$ 3,225	$ 5,843	$ 6,130
Services	2,856	2,772	5,649	5,480
Total consolidated revenues	6,017	5,997	11,492	11,610
Costs and expenses:
Cost of product sales	1,307	1,433	2,557	2,762
Cost of services	974	977	1,939	1,922
Research and development	821	782	1,635	1,570
Selling, general and administrative	2,034	2,102	4,021	4,139
Restructuring and acquisition-related charges	(1)	23	48	158
Operating income	882	680	1,292	1,059
Non-operating income (expense):
Investment income	26	26	39	51
Interest expense	(42)	(41)	(84)	(81)
Other income (expense), net	(14)	24	(9)	34
Total non-operating income (expense)	(30)	9	(54)	4
Income before provision for income taxes	852	689	1,238	1,063
Income tax provision	222	170	311	252
Net income	630	519	927	811
Less: Net income attributable to the non-controlling interests	(49)	(32)	(78)	(72)
Net income attributable to EMC Corporation	$ 581	$ 487	$ 849	$ 739
Net income per weighted average share, basic attributable to EMC Corporation common shareholders	$ 0.30	$ 0.25	$ 0.43	$ 0.38
Net income per weighted average share, diluted attributable to EMC Corporation common shareholders	$ 0.29	$ 0.25	$ 0.43	$ 0.37
Weighted average shares, basic	1,955	1,927	1,952	1,950
Weighted average shares, diluted	1,973	1,947	1,969	1,971
Cash dividends declared per common share	$ 0.12	$ 0.12	$ 0.23	$ 0.23

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cash flows from operating activities:
Cash received from customers	$ 12,953	$ 13,137
Cash paid to suppliers and employees	(9,749)	(10,076)
Dividends and interest received	57	68
Interest paid	(72)	(67)
Income taxes paid	(649)	(949)
Net cash provided by operating activities	2,540	2,113
Cash flows from investing activities:
Additions to property, plant and equipment	(299)	(449)
Capitalized software development costs	(310)	(262)
Purchases of short- and long-term available-for-sale securities	(2,458)	(4,212)
Sales of short- and long-term available-for-sale securities	2,140	2,667
Maturities of short- and long-term available-for-sale securities	1,771	913
Business acquisitions, net of cash acquired	(59)	(61)
Purchases of strategic and other related investments	(25)	(160)
Sales of strategic and other related investments	41	109
Increase in restricted cash	4	0
Net cash provided by (used in) investing activities	797	(1,455)
Cash flows from financing activities:
Proceeds from the issuance of EMC’s common stock	144	170
Repurchase of common stock	0	(2,063)
Excess tax benefits from stock-based compensation	9	54
Net proceeds (payments) for the issuance of short-term obligations	(503)	1,948
Dividend payment	(453)	(456)
Proceeds from non-controlling interests - issuance of common stock and contributions	233	4
Net cash used in financing activities	(518)	(1,124)
Effect of exchange rate changes on cash and cash equivalents	(14)	(74)
Net increase (decrease) in cash and cash equivalents	2,805	(540)
Cash and cash equivalents at beginning of period	6,549	6,343
Cash and cash equivalents at end of period	9,354	5,803
Reconciliation of net income to net cash provided by operating activities:
Net income	927	811
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	985	942
Non-cash restructuring and other special charges	3	13
Stock-based compensation expense	607	502
Provision for doubtful accounts	9	25
Deferred income taxes, net	(29)	(48)
Excess tax benefits from stock-based compensation	(9)	(54)
Impairment of joint venture	39	0
Other, net	17	18
Changes in assets and liabilities, net of acquisitions:
Accounts and notes receivable	1,077	1,017
Inventories	(103)	(45)
Other assets	(76)	(3)
Accounts payable	(501)	(443)
Accrued expenses	(460)	(480)
Income taxes payable	(325)	(650)
Deferred revenue	389	509
Other liabilities	(10)	(1)
Net cash provided by operating activities	2,540	2,113
VMware
Cash flows from financing activities:
Repurchase of common stock	0	(850)
Proceeds from non-controlling interests - issuance of common stock and contributions	$ 52	$ 69

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Jun. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 9,354	$ 6,549
Short-term investments	2,407	2,726
Accounts and notes receivable, less allowance for doubtful accounts of $89 and $90	2,896	3,977
Inventories	1,243	1,245
Other current assets	650	566
Total current assets	16,550	15,063
Long-term investments	4,387	5,508
Property, plant and equipment, net	3,725	3,850
Intangible assets, net	1,998	2,149
Goodwill	17,137	17,090
Deferred income taxes	1,169	1,164
Other assets, net	1,779	1,788
Total assets	46,745	46,612
Current liabilities:
Accounts payable	1,158	1,644
Accrued expenses	2,739	3,123
Income taxes payable	285	609
Short-term debt (See Note 4)	800	1,299
Deferred revenue	6,421	6,210
Total current liabilities	11,403	12,885
Income taxes payable	487	461
Deferred revenue	4,750	4,592
Long-term debt (See Note 4)	5,479	5,475
Other liabilities	471	480
Total liabilities	22,590	23,893
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 1,957 and 1,943 shares	20	19
Additional paid-in capital	0	0
Retained earnings	22,679	21,700
Accumulated other comprehensive loss, net	(561)	(579)
Total EMC Corporation’s shareholders’ equity	22,138	21,140
Non-controlling interests	2,017	1,579
Total shareholders’ equity	24,155	22,719
Total liabilities and shareholders’ equity	$ 46,745	$ 46,612