ROUND ROCKC, Texas, Aug. 28, 2020 — Dell Technologies announces financial results for its fiscal 2021 second quarter. Second quarter revenue was $22.7 billion, and non-GAAP revenue was $22.8 billion. During the quarter, the company generated operating income of $1.1 billion, a 119 percent increase over the same period in the prior year, and non-GAAP operating income of $2.6 billion. Net income was $1.1 billion, non-GAAP net income was $1.6 billion and adjusted EBITDA was $3.1 billion. Net cash from operating activities was $3.3 billion. Diluted earnings per share was $1.37 and non-GAAP diluted earnings per share was $1.92.

“We provide the technology solutions customers need to be productive and collaborative no matter where they work or learn, while delivering the data-driven insights and automation they need to innovate and transform,” said Jeff Clarke, vice chairman and chief operating officer, Dell Technologies. “In Q2, we saw strength in the government sector and in education, with orders up 16 and 24 percent, respectively, as parents, teachers and school districts prepare for a new frontier in virtual learning.”

Second Quarter Fiscal 2021 Financial Results

	Three Months Ended										Six Months Ended
	July 31, 2020				August 2, 2019				Change		July 31, 2020				August 2, 2019				Change
	(in millions, except per share amounts and percentages; unaudited)
Total net revenue	$	22,733			$	23,370			(3)%		$	44,630			$	45,278			(1)%
Operating income	$	1,136			$	519			119%		$	1,838			$	1,069			72%
Net income	$	1,099			$	4,232			(74)%		$	1,281			$	4,561			(72)%
Earnings per share – diluted	$	1.37			$	4.47			(69)%		$	1.56			$	4.84			(68)%
Non-GAAP net revenue	$	22,775			$	23,454			(3)%		$	44,720			$	45,444			(2)%
Non-GAAP operating income	$	2,618			$	2,743			(5)%		$	4,779			$	4,939			(3)%
Non-GAAP net income	$	1,621			$	1,751			(7)%		$	2,764			$	2,960			(7)%
Adjusted EBITDA	$	3,100			$	3,156			(2)%		$	5,707			$	5,729			—%
Non-GAAP earnings per share – diluted	$	1.92			$	2.15			(11)%		$	3.26			$	3.60			(9)%

Information about Dell Technologies’ use of non-GAAP financial information is provided under “Non-GAAP Financial Measures” below.  All comparisons in this press release are year-over-year unless otherwise noted.

Dell Technologies ended the quarter with cash and investments of $12.3 billion and paid down $3.5 billion in debt during the quarter. The company had total deferred revenue of $28.8 billion during the quarter, up 14 percent year-over-year. Recurring revenue, which includes deferred revenue amortization, utility, and as-a-Service delivered as part of Dell Technologies on Demand, was approximately $6 billion for the quarter, up 15 percent year-over-year.

“Now more than ever, customers need flexibility. We’re seeing increased adoption of our portfolio delivered as-a-service through flexible consumption solutions, which are now on a $1.3 billion revenue run-rate, up 30 percent year-over-year,” said Tom Sweet, chief financial officer, Dell Technologies. “As needs of the market shift, we continue to execute on our strategy of winning in the consolidating markets in which we compete and investing in long-term drivers of value creation for Dell Technologies and our stakeholders.”

Operating segments summary

Client Solutions Group revenue for the second quarter was $11.2 billion. Operating income was $715 million, or 6.4 percent of Client Solutions Group revenue.  The company saw continued demand for remote work and learning solutions. Consumer revenue was $3.2 billion, up 18 percent, while commercial client revenue was $8.0 billion, down 11 percent.

Key highlights:

• Strong performance driven by double-digit revenue growth across notebooks and consumer client
• Strength in the XPS premium line and gaming systems including Alienware, with combined orders growth of 25 percent
• The launch of new intelligent Latitude PCs, the world’s most intelligent PC with built-in AI and 5G connectivity, and a reengineered industry-leading Precision workstation portfolio

Infrastructure Solutions Group revenue for the second quarter was $8.2 billion, with customers continuing to direct more spending towards remote work and business continuity solutions. Storage revenue was $4.0 billion, while servers and networking revenue was $4.2 billion. Operating income was $973 million for the second quarter, or approximately 11.9 percent of Infrastructure Solutions Group revenue.

Key highlights:

• Continued strong demand for VxRail, with double-digit orders growth for the second straight quarter. Triple-digit orders growth for high-end PowerMax solution and double-digit orders growth in Data Protection
• The announcement of two new VxRail systems—including the first ruggedized VxRail model and introduction of AMD EPYC processors—bringing the power and simplicity of HCI to the most challenging and space-constrained edge environments
• Announced Dell EMC PowerScale, storage systems that help customers capture and capitalize on unstructured data, such as documents, images, videos and social media content in core data centers, edge locations and public cloud

VMware revenue was $2.9 billion for the second quarter, up 10 percent driven by broad-based strength across a diverse product portfolio. Operating income for the quarter was $894 million, or 30.7 percent of VMware revenue.

Conference call information

As previously announced, the Company will hold a conference call to discuss its second quarter performance today, August 27, 2020 at 4:30 p.m. CDT.  The conference call will be broadcast live over the internet and can be accessed at https://investors.delltechnologies.com/events-and-presentations/upcoming-events

For those unable to listen to the live broadcast, an archived version will be available at the same location for one year.

Additional financial and operating information may be downloaded from https://investors.delltechnologies.com/financial-information/quarterly-results

About Dell Technologies

Dell Technologies helps organizations and individuals build their digital future and transform how they work, live, and play. The company provides customers with the industry’s broadest and most innovative technology and services portfolio for the data era.

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Source: Dell Technologies