What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-03-25 compared with 2024-03-25 · 763 added, 714 removed, 1496 unchanged (50% of the section changed)

1 unchanged sentence

Report of Independent Registered Public Accounting Firm (Public Company Accounting Oversight Board ID:

Consolidated Statements of Financial Position as of February 2, 2024 and February 3, 2023

Consolidated Statements of Income for the fiscal years ended February 2 , 202 4, February 3, 2023, and January 28 , 2022

Consolidated Statements of Comprehensive Income for the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022

Consolidated Statements of Cash Flows for the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022

Consolidated Statements of Stockholders’ Equity (Deficit) for the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022

Consolidated Statements of Financial Position as of January 31, 2025 and February 2, 2024

Consolidated Statements of Income for the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023

Consolidated Statements of Comprehensive Income for the fiscal year s ended January 3 1, 202 5 , February 2, 20 24, and Febr uary 3, 2023

Consolidated Statements of Cash Flows for the fiscal year s ended January 31,2025, February 2, 2024 , and February 3, 2023

Consolidated Statements of Stockholders’ Equity (Deficit) for the fiscal year s ended January 31 , 202 5 , February 2 , 2024 , and February 3, 2023

Notes to the Consolidated Financial Statements

1 unchanged sentence

Note 2 — Summary of Significant Accounting Policies

Note 3 — Discontinued Operations

Note 3 — Fair Value Measurements

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Note 2 1 — Government Assistance

Note 22 — Quarterly Results (Unaudited)

Note 2 3 — Subsequent Events

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We have audited the accompanying consolidated statements of financial position of Dell Technologies Inc.

and its subsidiaries (the “Company”) as of February 2, 2024 and February 3, 2023, and the related consolidated statements of income, of comprehensive income, of stockholders’ equity (deficit) and of cash flows for each of the three years in the period ended February 2, 2024, including the related notes (collectively referred to as the “consolidated financial statements”).

We also have audited the Company's internal control over financial reporting as of February 2, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of February 2, 2024 and February 3, 2023, and the results of its operations and its cash flows for each of the three years in the period ended February 2, 2024 in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of February 2, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

and its subsidiaries (the “Company”) as of January 31, 2025 and February 2, 2024, and the related consolidated statements of income, of comprehensive income, of stockholders’ equity (deficit) and of cash flows for each of the three years in the period ended January 31, 2025, including the related notes (collectively referred to as the “consolidated financial statements”).

We also have audited the Company's internal control over financial reporting as of January 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of January 31, 2025 and February 2, 2024, and the results of its operations and its cash flows for each of the three years in the period ended January 31, 2025 in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company did not maintain, in all material respects, effective internal control over financial reporting as of January 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO because a material weakness in internal control over financial reporting existed as of that date as the Company did not design and maintain effective controls over non-recurring credits from certain suppliers that related to cost of net revenue.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.

The material weakness referred to above is described in Management’s Annual Report on Internal Control over Financial Reporting appearing under Item 9A.

We considered this material weakness in determining the nature, timing, and extent of audit tests applied in our audit of the 2025 consolidated financial statements, and our opinion regarding the effectiveness of the Company’s internal control over financial reporting does not affect our opinion on those consolidated financial statements.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Annual Report on Internal Control Over Financial Reporting appearing under Item 9A.

Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits.

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The Company’s performance obligations include various distinct goods and services such as hardware, software licenses, support and maintenance agreements, and other service offerings and solutions.

For the year ended February 2, 2024, a significant portion of the $33.9 billion Infrastructure Solutions Group (“ISG”) reportable segment net revenues relate to contracts with multiple performance obligations.

The principal considerations for our determination that performing procedures relating to the identification of performance obligations in revenue contracts is a critical audit matter are the significant judgment by management in identifying performance obligations in revenue contracts, which in turn led to a high degree of auditor judgment, subjectivity and effort in performing procedures to evaluate whether performance obligations in revenue contracts were appropriately identified by management.

For the year ended January 31, 2025, a significant portion of the $43.6 billion Infrastructure Solutions Group (“ISG”) reportable segment net revenues relate to contracts with multiple performance obligations.

The principal considerations for our determination that performing procedures relating to the identification of performance obligations in revenue contracts is a critical audit matter are (i) the significant judgment by management in identifying performance obligations in revenue contracts and (ii) a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating audit evidence related to whether performance obligations in revenue contracts were appropriately identified by management.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

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(in millions)

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

Current assets:

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Accounts receivable, net of allowance of $ 63 and $ 71

Due from related party, net — 378

Short-term financing receivables, net of allowance of $ 78 and $ 79 (Note 5)

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Other current assets 9,610 11,010

Current assets held for sale 668 —

Total current assets 36,229 35,984

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Intangible assets, net 4,988 5,701

Due from related party, net — 440

Other non-current assets 5,650 7,116

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Accounts payable 20,832 19,226

Due to related party — 2,067

Accrued and other 6,597 6,828

Short-term deferred revenue 13,673 15,318

Current liabilities held for sale 221 —

Total current liabilities 46,527 48,354

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Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

Products $ 71,420 $ 64,353 $ 79,250

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Net income 4,576 3,372 2,422

Income from discontinued operations, net of income taxes (Note 3)

Net income 3,195 2,422 5,707

Net loss attributable to non-controlling interests ( 16 ) ( 16 ) ( 20 )

Net income attributable to non-controlling interests of discontinued operations — — 150

Net income attributable to Dell Technologies Inc.

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Earnings per share attributable to Dell Technologies Inc.

Continuing operations $ 4.46 $ 3.33 $ 6.49

Discontinued operations $ — $ — $ 0.81

Earnings per share attributable to Dell Technologies Inc.

Continuing operations $ 4.36 $ 3.24 $ 6.26

Discontinued operations $ — $ — $ 0.76

Basic $ 6.51 $ 4.71 $ 3.33

Diluted $ 6.38 $ 4.60 $ 3.24

(a) Includes related party cost of net revenue as follows (Note 19):

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Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

Net income $ 4,576 $ 3,372 $ 2,422

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Recognition of actuarial net gains from pension and other postretirement plans — 15 1

Reclassification adjustments for net losses from pension and other postretirement plans 2 1 7

Net change in actuarial net gains from pension and other postretirement plans 17 2 44

Reclassification adjustments for net (gains) losses from pension and other postretirement plans ( 6 ) 2 1

Net change in actuarial net gains (losses) from pension and other postretirement plans ( 6 ) 17 2

Total other comprehensive income (loss), net of tax expense (benefit) of $ 9 , $ 15 , and $( 17 ), respectively

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Comprehensive income, net of tax 4,437 3,573 1,851

Net income (loss) attributable to non-controlling interests ( 16 ) ( 20 ) 144

Net loss attributable to non-controlling interests ( 16 ) ( 16 ) ( 20 )

Other comprehensive loss attributable to non-controlling interests — — ( 1 )

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CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions, continued on next page)

(in millions)

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

Cash flows from operating activities:

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Deferred income taxes ( 208 ) ( 91 ) ( 717 )

Other, net (a) 609 961 ( 3,130 )

Changes in assets and liabilities, net of effects from acquisitions and dispositions:

Other, net 453 609 961

Changes in assets and liabilities:

Accounts receivable ( 1,295 ) 2,977 113

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Acquisition of businesses and assets, net — ( 126 ) ( 70 )

Divestitures of businesses, net — — 3,957

Other 180 45 41

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Cash flows from financing activities:

Dividends paid by VMware, Inc.

to non-controlling interests

— — ( 2,240 )

Proceeds from the issuance of common stock 1 10 5

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Repurchases of common stock for employee tax withholdings ( 577 ) ( 372 ) ( 398 )

Net transfer of cash, cash equivalents, and restricted cash to VMware, Inc.

— — ( 5,052 )

Payments of dividends and dividend equivalents ( 1,275 ) ( 1,072 ) ( 964 )

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Change in cash from financing activities ( 5,815 ) ( 7,094 ) ( 1,625 )

____________________

(a) During the fiscal year ended January 28, 2022, other, net, includes $ 4.0 billion pre-tax gain on the sale of Boomi.

The accompanying notes are an integral part of these Consolidated Financial Statements.

DELL TECHNOLOGIES INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

Effect of exchange rate changes on cash, cash equivalents, and restricted cash ( 179 ) ( 186 ) ( 104 )

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CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)

(in millions;

(in millions, except per share amounts;

continued on next page )

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Balances as of January 28, 2022 777 $ 7,898 20 $ ( 964 ) $ ( 8,188 ) $ ( 431 ) $ ( 1,685 ) $ 105 $ ( 1,580 )

Net income — — — — 5,563 — 5,563 144 5,707

Net income (loss) — — — — 2,442 — 2,442 ( 20 ) 2,422

Dividends and dividend equivalents declared ($ 1.32 per common share)

— — — — ( 986 ) — ( 986 ) — ( 986 )

Foreign currency translation adjustments — — — — — ( 221 ) ( 221 ) ( 1 ) ( 222 )

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Treasury stock repurchases — — 62 ( 2,849 ) — — ( 2,849 ) — ( 2,849 )

Revaluation of redeemable shares — 472 — — — — 472 — 472

Impact from equity transactions of non-controlling interests — 14 — — — — 14 ( 23 ) ( 9 )

Dividends paid by VMware, Inc.

to non-controlling interests — — — — — — — ( 2,240 ) ( 2,240 )

Spin-off of VMware, Inc.

— ( 10,162 ) — — — 8 ( 10,154 ) ( 2,895 ) ( 13,049 )

Balances as of January 28, 2022 777 $ 7,898 20 $ ( 964 ) $ ( 8,188 ) $ ( 431 ) $ ( 1,685 ) $ 105 $ ( 1,580 )

Balances as of February 3, 2023 798 $ 8,424 82 $ ( 3,813 ) $ ( 6,732 ) $ ( 1,001 ) $ ( 3,122 ) $ 97 $ ( 3,025 )

The accompanying notes are an integral part of these Consolidated Financial Statements.

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in millions, except per share amounts;

continued on next page )

Common Stock and Capital in Excess of Par Value Treasury Stock

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Stockholders’ Equity (Deficit) Non-Controlling Interests Total Stockholders’ Equity (Deficit)

Balances as of January 28, 2022 777 $ 7,898 20 $ ( 964 ) $ ( 8,188 ) $ ( 431 ) $ ( 1,685 ) $ 105 $ ( 1,580 )

Balances as of February 3, 2023 798 $ 8,424 82 $ ( 3,813 ) $ ( 6,732 ) $ ( 1,001 ) $ ( 3,122 ) $ 97 $ ( 3,025 )

Net income (loss) — — — — 3,388 — 3,388 ( 16 ) 3,372

Dividends and dividend equivalents declared ($ 1.32 per common share)

Dividends and dividend equivalents declared

($ 1.48 per common share)

— — — — ( 1,109 ) — ( 1,109 ) — ( 1,109 )

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Net income (loss) — — — — 4,592 — 4,592 ( 16 ) 4,576

Dividends and dividend equivalents declared ($ 1.48 per common share)

Dividends and dividend equivalents declared

($ 1.78 per common share)

— — — — ( 1,299 ) — ( 1,299 ) — ( 1,299 )

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Impact from equity transactions of non-controlling interests — 11 — — — — 11 ( 20 ) ( 9 )

Balances as of February 2, 2024 821 $ 8,926 116 $ ( 5,900 ) $ ( 4,630 ) $ ( 800 ) $ ( 2,404 ) $ 95 $ ( 2,309 )

Balances as of January 31, 2025 834 $ 9,119 138 $ ( 8,502 ) $ ( 1,160 ) $ ( 939 ) $ ( 1,482 ) $ 95 $ ( 1,387 )

The accompanying notes are an integral part of these Consolidated Financial Statements.

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NOTE 1 — OVERVIEW AND BASIS OF PRESENTATION

Dell Technologies is a leading global end-to-end technology provider that designs, develops, manufactures, markets, sells, and supports a wide range of comprehensive and integrated solutions, products, and services.

Dell Technologies is a leader in the global technology industry that designs, develops, manufactures, markets, sells, and supports a wide range of comprehensive and integrated solutions, products, and services.

Dell Technologies offerings include servers and networking, storage, cloud solutions, desktops, notebooks, services, software, branded peripherals, and third-party software and peripherals.

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The Company’s fiscal year is the 52- or 53-week period ending on the Friday nearest January 31.

The fiscal years ended February 2, 2024 and January 28, 2022 were 52-week periods.

The fiscal years ended January 31, 2025 and February 2, 2024 were 52-week periods.

The fiscal year ended February 3, 2023 was a 53-week period.

Spin-Off of VMware, Inc.

— On November 1, 2021, the Company completed its spin-off of VMware LLC (formerly VMware, Inc.

and individually and together with its consolidated subsidiaries, “VMware”) by means of a special stock dividend (the “VMware Spin-off”).

In accordance with applicable accounting guidance, the results of VMware, excluding Dell Technologies' resale of VMware offerings, are presented as discontinued operations in the Consolidated Statements of Income and, as such, have been excluded from both continuing operations and segment results for the fiscal year ended January 28, 2022.

The Consolidated Statements of Cash Flows are presented on a consolidated basis for both continuing operations and discontinued operations for the fiscal year ended January 28, 2022.

See Note 3, Note 19, and Note 20 of the Notes to the Consolidated Financial Statements for additional information about the VMware Spin-off and recent developments in the Company’s relationship with VMware.

Boomi Divestiture — On October 1, 2021, Dell Technologies completed the sale of Boomi, Inc.

(“Boomi”) and certain related assets.

At the completion of the sale, the Company received total cash consideration of approximately $ 4.0 billion, resulting in a pre-tax gain on sale of $ 4.0 billion recognized in interest and other, net on the Consolidated Statements of Income.

The Company ultimately recorded a $ 3.0 billion gain, net of $ 1.0 billion in tax expense.

Prior to the divestiture, Boomi’s operating results were included within other businesses.

The divestiture did not qualify for presentation as a discontinued operation.

Secureworks — As of February 2, 2024 and February 3, 2023, the Company held approximately 81.0 % and 82.6 % , respectively, of the outstanding equity interest in SecureWorks Corp.

Revision of Previously Issued Financial Statements — During the fiscal year ended January 31, 2025, the Company discovered accumulated credits from certain suppliers that were not recorded or not recorded in the correct period in its previously reported financial results.

The Company initiated an investigation that indicated that the credits resulted from the actions of certain procurement employees that support a limited number of suppliers, which affected the Client Solutions Group (“CSG”) segment.

The revision did not have an impact on the Company’s net revenue.

The Company determined that the impacts were not material, individually or in the aggregate, to its previously issued Consolidated Financial Statements and accompanying Notes to the Consolidated Financial Statements for any of the prior quarters or the annual period in which they occurred.

However, in accordance with Staff Accounting Bulletin No.

108 of the Securities and Exchange Commission (“SEC”), the Company concluded that correcting the cumulative misstatement in the current period would be material to its results of operations for the fiscal year ended January 31, 2025.

Accordingly, the Company has revised its previously issued Consolidated Financial Statements, as applicable, as of and for the fiscal year ended February 2, 2024.

A summary of the corrections to the impacted financial statement line items in these Consolidated Financial Statements is presented below.

Consolidated Statements of Financial Position

February 2, 2024

As Reported Adjustment As Revised

(in millions)

Current assets:

Other current assets $ 10,973 $ 37 $ 11,010

Total current assets $ 35,947 $ 37 $ 35,984

Total assets $ 82,089 $ 37 $ 82,126

Current liabilities:

Accounts payable $ 19,389 $ ( 163 ) $ 19,226

Accrued and other $ 6,805 $ 23 $ 6,828

Total current liabilities $ 48,494 $ ( 140 ) $ 48,354

Total liabilities $ 84,398 $ ( 140 ) $ 84,258

Stockholders' equity (deficit):

Accumulated deficit $ ( 4,630 ) $ 177 $ ( 4,453 )

Total Dell Technologies Inc.

stockholders' equity (deficit) $ ( 2,404 ) $ 177 $ ( 2,227 )

Total stockholders' equity (deficit) $ ( 2,309 ) $ 177 $ ( 2,132 )

Total liabilities and stockholders' equity $ 82,089 $ 37 $ 82,126

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Consolidated Statements of Income

Fiscal Year Ended

February 2, 2024

As Reported Adjustment As Revised

(in millions, except per share amounts)

Cost of net revenue:

Products $ 53,316 $ ( 200 ) $ 53,116

Total cost of net revenue $ 67,556 $ ( 200 ) $ 67,356

Gross margin $ 20,869 $ 200 $ 21,069

Operating income $ 5,211 $ 200 $ 5,411

Income before income taxes $ 3,887 $ 200 $ 4,087

Income tax expense $ 692 $ 23 $ 715

Net income $ 3,195 $ 177 $ 3,372

Net income attributable to Dell Technologies Inc.

$ 3,211 $ 177 $ 3,388

Earnings per share attributable to Dell Technologies Inc.

Basic $ 4.46 $ 0.25 $ 4.71

Diluted $ 4.36 $ 0.24 $ 4.60

Consolidated Statements of Comprehensive Income

Fiscal Year Ended

February 2, 2024

As Reported Adjustment As Revised

(in millions)

Net income $ 3,195 $ 177 $ 3,372

Comprehensive income, net of tax $ 3,396 $ 177 $ 3,573

Comprehensive income attributable to Dell Technologies Inc.

$ 3,412 $ 177 $ 3,589

Consolidated Statements of Cash Flows

Fiscal Year Ended

February 2, 2024

As Reported Adjustment As Revised

(in millions)

Cash flow from operations:

Net income $ 3,195 $ 177 $ 3,372

Adjustments to reconcile net income to net cash provided by operating activities:

Other assets and liabilities $ ( 1,470 ) $ ( 14 ) $ ( 1,484 )

Accounts payable $ ( 335 ) $ ( 163 ) $ ( 498 )

The Company will also revise previously reported quarterly financial information for this misstatement based on the summary presented herein in its future filings with the SEC, as applicable.

A summary of the corrections to the impacted financial statement line items to the Company’s previously issued Condensed Consolidated Financial Statements for each quarterly period is presented in Note 22 of the Notes to the Consolidated Financial Statements.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Secureworks — As of January 31, 2025 and February 2, 2024, the Company held approximately 78.6 % and 81.0 %, respectively, of the outstanding equity interest in Secureworks Corp.

(“Secureworks”).

The portion of the results of operations of Secureworks allocable to its other owners is shown as net loss attributable to non-controlling interests in the Consolidated Statements of Income, as an adjustment to net income attributable to Dell Technologies stockholders.

The non-controlling interests’ share of equity in Secureworks is reflected as non-controlling interests in the Consolidated Statements of Financial Position and wa s $ 95 million and $ 97 million as of February 2, 2024 and February 3, 2023, respectively.

Other Events — On July 12, 2023, the Company entered into a definitive agreement with Comenity Capital Bank, a subsidiary of Bread Financial Holdings, Inc.

(“Bread”), to establish a new consumer revolving financing program, operated as the “Dell Pay Credit” program, under which transactions are originated, owned, serviced, and collected by Bread.

Under the agreement, the Company also agreed to sell its U.S.

consumer revolving customer receivables portfolio.

On October 4, 2023, the parties closed the sale for total cash consideration of approximately $ 390 million and the Company recognized an immaterial gain within the Consolidated Statements of Income.

Upon completion of the sale, the Company derecognized transferred receivables, net of $ 380 million from the Consolidated Statements of Financial Position.

On October 21, 2024, Secureworks announced that it had entered into a definitive agreement providing for its sale to Sophos Inc., an affiliate of Thoma Bravo, L.P., a private equity and growth capital firm.

The transaction was completed on February 3, 2025, subsequent to the close of the Company’s fiscal year ended January 31, 2025, in an all-cash transaction for a purchase price of approximately $ 0.9 billion.

The Company expects to record an immaterial gain from the transaction.

In accordance with applicable accounting guidance, the Company concluded that Secureworks’ assets and liabilities have met the criteria to be classified as held-for-sale as of January 31, 2025.

The Company reclassified the related assets and liabilities as current assets held for sale and current liabilities held for sale, respectively, in the accompanying Consolidated Statements of Financial Position as of January 31, 2025.

The following table presents the major classes of assets and liabilities as of January 31, 2025 related to Secureworks, which were classified as held for sale as of the date indicated:

January 31, 2025

(in millions)

Current assets:

Cash and cash equivalents $ 62

Accounts receivable, net 51

Other current assets 11

Total current assets 124

Intangible assets, net 63

Other non-current assets 54

Total assets $ 668

Current liabilities:

Accrued and other $ 71

Short-term deferred revenue 125

Total current liabilities 196

Other non-current liabilities 25

Total liabilities $ 221

The sale of Secureworks does not meet the criteria for discontinued operations reporting, and as a result its operating results and cash flows are not separately stated as a discontinued operation in the accompanying Consolidated Financial Statements.

As Secureworks does not meet the requirements for a reportable segment, its operating results are included within Corporate and other.

Other Events — On October 4, 2023, the Company established a new consumer revolving financing program with Comenity Capital Bank, a subsidiary of Bread Financial Holdings, Inc.

(“Bread”), under which transactions are originated, owned, serviced, and collected by Bread.

Under the agreement, the Company also sold its U.S.

consumer revolving customer receivables portfolio for total cash consideration of approximately $ 390 million, resulting in an immaterial gain recognized within the Consolidated Statements of Income.

The Company has no continuing involvement with these receivables, which are serviced by Bread.

See Note 6 of the Notes to the Consolidated Financial Statements for more information.

DELL TECHNOLOGIES INC.

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NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation — These Consolidated Financial Statements include the accounts of Dell Technologies and its wholly-owned subsidiaries, as well as the accounts of Secureworks, which, as indicated in Note 1 of the Notes to the Consolidated Financial Statements, is majority-owned by Dell Technologies, and VMware through the date of the VMware Spin-off.

Principles of Consolidation — These Consolidated Financial Statements include the accounts of Dell Technologies and its wholly-owned subsidiaries, as well as the accounts of Secureworks, which, as indicated in Note 1 of the Notes to the Consolidated Financial Statements, was majority-owned by Dell Technologies as of January 31, 2025.

All intercompany transactions have been eliminated.

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Strategic investments in non-marketable equity and other securities without readily determinable fair values are recorded at cost, less impairment, and are adjusted for observable price changes.

Fair value measurements and impairments for strategic investments are recognized in interest and other, net in the Consolidated Statements of Income.

In evaluating equity investments without readily determinable fair values for impairment or observable price changes, the Company uses inputs that include pre- and post-money valuations of recent financing events and the impact of those events on its fully diluted ownership percentages, as well as other available information regarding the issuer’s historical and forecasted performance.

Fixed-income debt securities are carried at amortized cost.

The Company intends to hold the fixed-income debt securities to maturity.

Fair value measurements and impairments for strategic investments are recognized in interest and other, net in the Consolidated Statements of Income.

Fixed-income debt securities are carried at amortized cost and approximate fair value.

The Company intends to hold its fixed-income debt securities to maturity.

Allowance for Expected Credit Losses on Accounts Receivable — The Company recognizes an allowance for losses on accounts receivable in an amount equal to the current expected credit losses.

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The Company assesses collectibility by pooling receivables where similar characteristics exist and evaluates receivables individually when specific customer balances no longer share those risk characteristics and are considered at risk or uncollectible.

The expense associated with the allowance for expected credit losses is recognized in selling, general, and administrative expenses.

The expense associated with the allowance for expected credit losses is recognized in selling, general, and administrative expenses in the Consolidated Statements of Income.

DELL TECHNOLOGIES INC.

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The Company’s leases are generally classified as operating leases.

Finance leases are immaterial.

The Company does not have any material finance leases.

Operating leases result in the recognition of right of use (“ROU”) assets and lease liabilities on the Consolidated Statements of Financial Position.

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The warehouses and some of the equipment used are considered embedded leases.

The Company accounts for the lease and non-lease components separately.

The Company accounts for the lease and non-lease components separately for its warehouses and equipment.

The lease components consist of the warehouses and some of the equipment, such as conveyor belts.

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DFS provides lessees with the option to extend the lease or purchase the underlying asset at the end of the lease term, which is considered when evaluating lease classification.

In general, DFS’s lease arrangements do not have variable payment terms and are typically non-cancelable.

In general, DFS lease arrangements do not have variable payment terms and are typically non-cancelable.

On commencement of sales-type leases, the Company recognizes profit up-front, and amounts due from the customer under the lease contract are recognized as financing receivables on the Consolidated Statements of Financial Position.

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Impairment of assets in a customer contract is assessed on the same basis as other long-lived assets.

Accounting for Fixed-Term Loans — For fixed-term loans, the Company may recognize profit up-front upon commencement or over time depending on the product or service offering.

Amounts due from the customer under the loan agreement are recognized as financing receivables on the Consolidated Statements of Financial Position.

The Company generally recognizes interest income to product revenue based on the effective interest method and expenses deferred initial direct costs on a straight-line basis over the loan term.

Financing Receivables — Financing receivables are presented net of allowance for losses and consist of customer receivables and residual interest.

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Fixed-term loans are also offered to qualified individual consumers.

Revolving loans offered under a private label credit financing program, referred to as Dell Business Credit (“DBC”), are primarily offered to small and medium-sized business customers.

Revolving loans were primarily offered to small and medium-sized business customers, with the remaining offerings discontinued during the fiscal year ended January 31, 2025.

The Company retains a residual interest in equipment leased under its fixed-term lease programs.

The amount of the residual interest is established at the inception of the lease based upon estimates of the value of the equipment at the end of the lease term using historical studies, industry data, and future value-at-risk demand valuation methods.

Allowance for Financing Receivables Losses — The Company recognizes an allowance for financing receivables losses, including both the lease receivable and unguaranteed residual, in an amount equal to the expected losses net of recoveries.

The allowance for financing receivables losses on the lease receivable is determined based on various factors, including lifetime expected losses determined using macroeconomic forecast assumptions and management judgments applicable to and through the expected life of the portfolios as well as past due receivables, receivable type, and customer risk profile.

Both fixed and revolving financing receivables loss rates are affected by macroeconomic conditions, including the level of gross domestic product (“GDP”) growth, the level of commercial capital equipment investment, unemployment rates, and the credit quality of the borrower.

Allowance for Financing Receivable Losses — The Company recognizes an allowance for financing receivable losses, including both the lease receivable and unguaranteed residual, in an amount equal to the expected losses net of recoveries.

The allowance for financing receivable losses on the lease receivable is determined based on various factors, including lifetime expected losses determined using macroeconomic forecast assumptions and management judgments applicable to and through the expected life of the portfolios as well as past due receivables, receivable type, and customer risk profile.

Generally, expected credit losses as a result of residual value risk on equipment under lease are not considered to be significant primarily because of the existence of a secondary market with respect to the equipment.

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While the Company does not generally place financing receivables on non-accrual status during the delinquency period, accrued interest is included in the allowance for loss calculation and, therefore, the Company is adequately reserved in the event of charge off.

Recoveries on receivables previously charged off as uncollectible are recorded to the allowance for financing receivables losses.

The expense associated with the allowance for financing receivables losses is recognized as cost of net revenue.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Recoveries on receivables previously charged off as uncollectible are recorded to the allowance for financing receivable losses.

The expense associated with the allowance for financing receivable losses is recognized as cost of net revenue.

Asset Securitization — The Company transfers certain U.S.

and European customer loan and lease payments and associated equipment to Special Purpose Entities (“SPEs”) that meet the definition of a Variable Interest Entity (“VIE”) and are consolidated into the Consolidated Financial Statements.

and European customer lease and loan payments and associated equipment to Special Purpose Entities (“SPEs”) that meet the definition of a Variable Interest Entity (“VIE”) and are consolidated into the Consolidated Financial Statements.

These SPEs are bankruptcy-remote legal entities with separate assets and liabilities.

The purpose of the SPEs is to facilitate the funding of customer loan and lease payments and associated equipment in the capital markets.

The purpose of the SPEs is to facilitate the funding of customer lease and loan payments and associated equipment in the capital markets.

Some of these SPEs have entered into financing arrangements with multi-seller conduits that, in turn, issue asset-backed debt securities in the capital markets.

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Inventories — The Company generally records inventory on the Consolidated Statements of Financial Position when legal title and risk of loss have passed to the Company for items that are held for sale in the ordinary course of business, that are in process of production for sale, or that will be consumed in the production of goods or services that will be held for sale.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Inventories are stated at the lower of cost or net realizable value, with cost being determined on a first-in, first-out basis.

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Gains or losses related to retirements or dispositions of fixed assets are recognized in the period during which the retirement or disposition occurs.

Capitalized Software Development Costs — Software development costs related to the development of new product offerings are capitalized subsequent to the establishment of technological feasibility, which is demonstrated by the completion of a detailed program design or working model, if no program design is completed.

The Company amortizes capitalized costs on a straight-line basis over the estimated useful lives of the products, which is generally two years .

As of February 2, 2024 and February 3, 2023, capitalized software development costs were $ 646 million and $ 673 million, respectively, and are included in other non-current assets, net in the accompanying Consolidated Statements of Financial Position.

Amortization expense for the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022 was $ 416 million, $ 317 million, and $ 263 million, respectively.

The Company capitalizes certain internal and external costs to acquire or create internal use software which are incurred subsequent to the completion of the preliminary project stage.

Costs associated with maintenance and minor enhancements to the features and functionality of the Company’s internal use software are expensed as incurred.

Impairment of Long-Lived Assets — The Company reviews long-lived assets for impairment when events or changes in circumstances indicate the carrying amount of an asset may not be recoverable.

The Company assesses the recoverability of the assets based on the undiscounted future cash flows expected from the use and eventual disposition of the asset.

The Company amortizes capitalized software development costs on a straight-line basis over the estimated useful lives of the products, which is generally two years .

As of January 31, 2025 and February 2, 2024, capitalized software development costs were $ 623 million and $ 646 million, respectively, and are included in other non-current assets, net in the accompanying Consolidated Statements of Financial Position.

Amortization expense for the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023 was $ 325 million, $ 416 million, and $ 317 million, respectively.

Impairment of Long-Lived Assets — The Company reviews long-lived assets for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

The Company assesses the recoverability of the asset based on the undiscounted future cash flows expected from the use and eventual disposition of the asset.

If the carrying amount of the asset is determined not to be recoverable, a write-down to fair value is recorded.

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Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Intangible Assets Including Goodwill — Identifiable intangible assets with finite lives are amortized over their estimated useful lives.

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Dollar as their functional currency translate assets and liabilities at current exchange rates in effect at the balance sheet date.

Revenue and expenses from these international subsidiaries are translated using either the monthly average exchange rates in effect for the period in which the activity was recognized or the specific daily exchange rate associated with the date the transactions actually occur.

Revenue and expenses from these international subsidiaries are translated using the monthly average exchange rates in effect for the period in which the activity was recognized.

Foreign currency translation adjustments are included as a component of accumulated other comprehensive income (loss) (“AOCI”) in stockholders’ equity (deficit).

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Local currency transactions of international subsidiaries that have the U.S.

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The Company’s agreements have varying requirements depending on the goods and services being sold, the rights and obligations conveyed, and the legal jurisdiction of the arrangement.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

While most of our agreements have standard terms and conditions, more complex agreements may contain nonstandard terms and conditions that require significant judgments in interpreting agreements to determine the appropriate accounting.

Revenue is recognized for these arrangements based on the following five steps:

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Judgment is used in determining the customer’s ability and intent to pay, which is based upon various factors, including the customer’s historical payment experience or customer credit and financial information.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(2) Identify the performance obligations in the contract.

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The Company estimates SSP by considering multiple factors, including, but not limited to, pricing practices, internal costs, and profit objectives as well as overall market conditions, which include geographic or regional specific factors, competitive positioning, and competitor actions.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

(5) Recognize revenue when (or as) the performance obligation is satisfied.

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The Company reports revenue net of any revenue-based taxes assessed by governmental authorities that are imposed on and concurrently with specific revenue-producing transactions.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company has elected the following practical expedients:

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Other services revenue is recognized when the Company performs the services and the customer receives and consumes the benefits.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Revenue from leasing arrangements is not subject to the revenue standard for contracts with customers and remains separately accounted for under lease accounting guidance.

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Sales-type leases also produce financing income, which is included in product net revenue in the Consolidated Statements of Income and is recognized at effective rates of return over the lease term.

The Company also offers qualified customers fixed-term loans and revolving credit lines for the purchase of products and services offered by the Company.

The Company also offers qualified customers fixed-term loans as well as previously offered revolving lines of credit through DFS for the purchase of products and services offered by the Company.

Financing income attributable to these loans is recognized in product net revenue on an accrual basis.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Principal versus Agent — For transactions that involve a third party, the Company evaluates whether it is acting as the principal or the agent in the transaction.

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As an agent, the Company is arranging for the good or service to be provided by another party and recognizes revenue at the net amount of consideration retained.

Disaggregation of Revenue — The Company’s revenue is presented on a disaggregated basis on the Consolidated Statements of Income and in Note 19 of the Notes to the Consolidated Financial Statements based on an evaluation of disclosures outside of the financial statements, information regularly reviewed by the chief operating decision maker for evaluating the financial performance of operating segments, and other information that is used to evaluate the Company’s financial performance and make resource allocations.

Disaggregation of Revenue — The Company’s revenue is presented on a disaggregated basis on the Consolidated Statements of Income and in Note 18 of the Notes to the Consolidated Financial Statements based on an evaluation of disclosures outside of the financial statements, information regularly provided to and reviewed by the Company’s chief operating decision maker for evaluating the financial performance of operating segments, and other information that is used to evaluate the Company’s financial performance and make resource allocations.

This information includes revenue from products and services, revenue from reportable segments, and revenue by major product categories within the segments.

Contract Assets — Contract assets are rights to consideration in exchange for goods or services that the Company has transferred to a customer when such a right is conditional on something other than the passage of time.

Such amounts are immaterial as of February 2, 2024 and February 3, 2023.

Contract Assets — Contract assets are rights to consideration in exchange for goods or services that the Company has transferred to a customer when such a right is conditional on criteria other than the passage of time.

Such amounts are immaterial as of January 31, 2025 and February 2, 2024.

Contract Liabilities — Contract liabilities primarily consist of deferred revenue.

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See Note 10 of the Notes to the Consolidated Financial Statements for additional information about deferred revenue.

Deferred Costs — Deferred costs primarily consist of costs incurred to fulfill revenue-generating contracts mainly associated with VMware Resale offerings discussed in Note 19 and Note 20 of the Notes to the Consolidated Financial Statements and third-party software support and maintenance offerings.

Deferred costs are included with other current assets and other non-current assets on the Consolidated Statements of Financial Position.

The Company defers and subsequently amortizes these charges on a straight-line basis over the life of the contract or the average contract duration to obtain the appropriate expense recognition timing.

Costs to Obtain a Contract — The Company capitalizes incremental direct costs to obtain a contract, primarily sales commissions and employer taxes related to commission payments, if the costs are deemed to be recoverable.

Deferred Costs — Deferred costs primarily consist of costs incurred to fulfill or obtain a contract and are included within other current assets and other non-current assets on the Consolidated Statements of Financial Position, based on when the expense is expected to be recognized.

Costs incurred to fulfill revenue-generating contracts are mainly associated with third-party software support and maintenance offerings and VMware Resale offerings discussed in Note 18 and Note 19 of the Notes to the Consolidated Financial Statements.

The Company defers and subsequently amortizes these charges on a straight-line basis over the life of the contract or the average contract duration.

Amortization expense is included in cost of net revenue in the Consolidated Statements of Income.

Deferred costs to fulfill revenue-generating contracts as of January 31, 2025 and February 2, 2024 were $ 4.8 billion and $ 7.7 billion, respectively.

Amortization of deferred costs to fulfill revenue-generating contracts during the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023 was $ 7.6 billion, $ 8.0 billion, and $ 7.3 billion, respectively.

The Company capitalizes incremental direct costs to obtain a contract, primarily sales commissions and employer taxes related to commission payments, if the costs are deemed to be recoverable.

The Company has elected, as a practical expedient, to expense as incurred costs to obtain a contract equal to or less than one year in duration.

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Amortization expense is recognized on a straight-line basis and included in selling, general, and administrative expenses in the Consolidated Statements of Income.

Deferred costs to obtain a contract as of January 31, 2025 and February 2, 2024 were $ 540 million and $ 674 million, respectively.

Amortization of costs to obtain a contract during the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023 was $ 346 million, $ 383 million, and $ 390 million, respectively.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company periodically reviews these deferred costs to determine whether events or changes in circumstances have occurred that could impact the carrying value or period of benefit of the deferred sales commissions.

There were no material impairment losses for deferred costs to obtain a contract during the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022.

Deferred costs to obtain a contract as of February 2, 2024 and February 3, 2023 were $ 674 million and $ 726 million, respectively.

Deferred costs to obtain a contract are classified as current assets and other non-current assets on the Consolidated Statements of Financial Position, based on when the expense is expected to be recognized.

Amortization of costs to obtain a contract during the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022 was $ 383 million, $ 390 million, and $ 380 million, respectively.

There were no material impairment losses for deferred costs during the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023.

Standard Warranty Liabilities — The Company records warranty liabilities for estimated costs of fulfilling its obligations under standard limited hardware and software warranties at the time of sale.

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Each quarter, the Company reevaluates its estimates to assess the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary.

See Note 20 of the Notes to the Consolidated Financial Statements for additional information about standard warranty liabilities.

Consideration Received from Vendors — The Company may receive consideration from vendors in the normal course of business.

Certain of these funds received as consideration are rebates of purchase price paid and others are related to reimbursement of costs incurred by the Company to sell the vendor’s products.

The Company recognizes a reduction of cost of goods sold if the funds are determined to be a reduction of the price of the vendor’s products.

The Company recognizes a reduction to cost of net revenue if the funds are determined to be a reduction of the price of the vendor’s products.

If the consideration is a reimbursement of costs incurred by the Company to sell or develop the vendor’s products, the consideration is classified as a reduction of such costs, most often operating expenses, in the Consolidated Statements of Income.

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Selling, General, and Administrative — Selling expenses include items such as sales salaries and commissions, marketing and advertising costs, and contractor services.

Advertising costs are expensed as incurred in selling, general, and administrative expenses in the Consolidated Statements of Income.

For the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022, advertising expenses were $ 0.9 billion, $ 1.1 billion, and $ 1.3 billion, respectively.

Advertising costs are generally expensed as incurred in selling, general, and administrative expenses in the Consolidated Statements of Income.

For the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023, advertising expenses were $ 0.8 billion, $ 0.9 billion, and $ 1.1 billion, respectively.

General and administrative expenses include items for the Company’s administrative functions, such as finance, legal, human resources, and information technology support.

These functions include costs for items such as salaries and benefits and other personnel-related costs, maintenance and supplies, outside services, intangible asset amortization, and depreciation expense.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Research and Development — Research and development (“R&D”) costs are primarily expensed as incurred.

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Also included in R&D expenses are infrastructure costs, which consist of equipment and material costs, facilities-related costs, and depreciation expense.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Income Taxes — The Company calculates a provision for income taxes using the asset and liability method, under which deferred tax assets and liabilities are recognized by identifying the temporary differences arising from the different treatment of items for tax and accounting purposes.

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Recently Issued Accounting Pronouncements

Segment Reporting — In November 2023, the Financial Accounting Standards Board (“FASB”) issued guidance to improve disclosures about a public entity’s reportable segments by requiring disclosure of additional information about a reportable segment’s expenses on an annual and interim basis.

Expense Disaggregation Disclosures — In November 2024, the Financial Accounting Standards Board (“FASB”) issued guidance to improve disclosures about a public entity’s expenses by requiring disclosure of additional information about the types of expenses commonly presented in the financial statement on an annual and interim basis.

Public entities must adopt the new guidance for fiscal years beginning after December 15, 2026, with early adoption permitted.

Upon adoption, the guidance is required to be applied retrospectively to all prior periods presented in the financial statements.

Upon adoption, the guidance can be applied prospectively or retrospectively.

Adoption of this new guidance will result in increased disclosures in the Notes to the Consolidated Financial Statements.

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Public entities must adopt the new guidance for fiscal years beginning after December 15, 2024, with early adoption permitted.

Upon adoption, the guidance can be applied prospectively or retrospectively.

The Company will adopt the guidance prospectively.

Adoption of this new guidance will result in increased disclosures in the Notes to the Consolidated Financial Statements.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 3 — DISCONTINUED OPERATIONS

VMware Spin-Off — As disclosed in Note 1 of the Notes to the Consolidated Financial Statements, on November 1, 2021, the Company completed its spin-off of VMware by means of a special stock dividend of 30,678,605 shares of Class A common stock and 307,221,836 shares of Class B common stock of VMware to Dell Technologies stockholders of record as of October 29, 2021.

VMware paid a cash dividend, pro rata, to each of the holders of VMware common stock in an aggregate amount equal to $ 11.5 billion, of which Dell Technologies received $ 9.3 billion.

Dell Technologies determined that the VMware Spin-off, and related distributions, qualified as tax-free for U.S.

federal income tax purposes, which required significant judgment by management.

In making these determinations, Dell Technologies applied U.S.

federal tax law to relevant facts and circumstances and obtained a favorable private letter ruling from the Internal Revenue Service, a tax opinion, and other external tax advice related to the concluded tax treatment.

If the completed transactions were to fail to qualify for tax-free treatment for U.S.

federal income tax purposes, the Company could be subject to significant liabilities, which could have material adverse impacts on the Company’s business, financial condition, results of operations and cash flows in future reporting periods.

In connection with and upon completion of the VMware Spin-off, Dell Technologies and VMware entered into various agreements that provided a framework for the relationship between the companies after the transaction, including, among others, a commercial framework agreement, a tax matters agreement, and a transition services agreement.

The Commercial Framework Agreement (“CFA”) provided a framework under which the Company and VMware continued their commercial relationship after the transaction, particularly with respect to projects mutually agreed by the parties as having the potential to accelerate the growth of an industry, product, service, or platform that may provide one or both companies with a strategic market opportunity.

On November 22, 2023, VMware was acquired by Broadcom, Inc.

(“Broadcom”).

Following the acquisition, Broadcom announced changes to its go-to-market approach for VMware offerings, which impacted the Company’s commercial relationship with VMware.

In response to such changes, on January 25, 2024, under a provision of the CFA permitting the Company to terminate the agreement upon a change in control of VMware, the Company delivered notice of termination of the CFA to Broadcom under which the agreement will terminate on March 25, 2024.

Cash flows between Dell Technologies and VMware for the periods presented primarily relate to the Company’s resale of VMware’s standalone products and services and sale of Dell Technologies’ offerings integrated with select VMware products and services.

See Note 20 of the Notes to the Consolidated Financial Statements for additional information regarding transactions between Dell Technologies and VMware.

In accordance with applicable accounting guidance, the results of VMware, excluding Dell Technologies’ resale of VMware offerings, are presented as discontinued operations in the Consolidated Statements of Income and, as such, have been excluded from both continuing operations and segment results for the fiscal year ended January 28, 2022.

The Consolidated Statements of Cash Flows are presented on a consolidated basis for both continuing operations and discontinued operations for the fiscal year ended January 28, 2022.

The tax matters agreement between the Company and VMware governs the respective rights, responsibilities, and obligations of Dell Technologies and VMware with respect to tax liabilities (including taxes, if any, incurred as a result of any failure of the VMware Spin-off to qualify for tax-free treatment for U.S.

federal income tax purposes) and benefits, tax attributes, the preparation and filing of tax returns, the control of audits and other tax proceedings, cooperation, and other matters regarding tax.

The transition services agreement between the Company and VMware governed the various administrative services which the Company provided to VMware on an interim transitional basis.

Transition services were fulfilled and concluded during the fiscal year ended February 3, 2023.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table presents key components of “Income from discontinued operations, net of income taxes” for the fiscal year ended January 28, 2022:

Fiscal Year Ended

January 28, 2022

(in millions)

Net revenue $ 5,798

Cost of net revenue ( 1,632 )

Operating expenses 6,384

Interest and other, net 232

Income from discontinued operations before income taxes 814

Income tax expense 49

Income from discontinued operations, net of income taxes $ 765

____________________

The table above reflects the offsetting effects of historical intercompany transactions which are presented on a gross basis within continuing operations on the Consolidated Statements of Income.

The following table presents significant cash flow items from discontinued operations for the fiscal year ended January 28, 2022 included within the Consolidated Statements of Cash Flows:

Fiscal Year Ended

January 28, 2022

(in millions)

Depreciation and amortization $ 1,004

Capital expenditures $ 263

Stock-based compensation expense $ 814

Recently Adopted Accounting Pronouncements

Segment Reporting — In November 2023, the FASB issued guidance to improve disclosures about a public entity’s reportable segments by requiring disclosure of additional information about a reportable segment’s expenses on an annual and interim basis.

The Company adopted this standard as of January 31, 2025 on a retrospective basis.

Adoption of this new guidance resulted in increased disclosures on reportable segments in Note 18 of the Notes to the Consolidated Financial Statements.

DELL TECHNOLOGIES INC.

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The following table presents the Company’s hierarchy for its assets and liabilities measured at fair value on a recurring basis as of the dates indicated:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total

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Money Market Funds — The Company’s investment in money market funds that are classified as cash equivalents hold underlying investments with a weighted average maturity of 90 days or less and are recognized at fair value.

The valuations of these securities are based on quoted prices in active markets for identical assets, when available, or pricing models whereby all significant inputs are observable or can be derived from or corroborated by observable market data.

The valuations of these securities are based on quoted prices for identical assets in active markets, when available, or pricing models whereby all significant inputs are observable, can be derived from, or can be corroborated by, observable market data.

The Company reviews security pricing and assesses money market fund liquidity on a quarterly basis.

As of February 2, 2024, the Company’s portfolio had no material exposure to money market funds with a fluctuating net asset value.

As of January 31, 2025, the Company’s portfolio had no material exposure to money market funds with a fluctuating net asset value.

Marketable Equity and Other Securities — The Company’s investments in equity and other securities that are measured at fair value on a recurring basis consist of strategic investments in publicly-traded companies.

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Deferred Compensation Plans — The Company offers deferred compensation plans for eligible employees which allow participants to defer a portion of their compensation.

Assets were the same as liabilities associated with the plans at approximately $ 214 million and $ 179 million as of February 2, 2024 and February 3, 2023, respectively, and are included in other assets and other liabilities on the Consolidated Statements of Financial Position.

The net impact to the Consolidated Statements of Income is not material since changes in the fair value of the assets substantially offset changes in the fair value of the liabilities.

Assets and liabilities associated with the plans are measured at fair value using Level 1 inputs.

Assets were the same as liabilities associated with the plans at approximately $ 244 million and $ 214 million as of January 31, 2025 and February 2, 2024, respectively, and are included in other assets and other liabilities on the Consolidated Statements of Financial Position.

The net impact on the Consolidated Statements of Income is not material since changes in the fair value of the assets substantially offset changes in the fair value of the liabilities.

As such, assets and liabilities associated with these plans have not been included in the recurring fair value table above.

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Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis — Certain assets are measured at fair value on a nonrecurring basis and therefore are not included in the recurring fair value table above.

These assets consist primarily of non-financial assets such as goodwill and intangible assets.

See Note 10 of the Notes to the Consolidated Financial Statements for additional information about goodwill and intangible assets.

As of both February 2, 2024 and February 3, 2023, the Company held strategic investments in non-marketable equity and other securities of $ 1.3 billion.

As these investments represent early-stage companies without readily determinable fair values, they are not included in the recurring fair value table above.

See Note 5 of the Notes to the Consolidated Financial Statements for additional information about the Company’s strategic investments.

These assets consist primarily of financial assets such as the Company’s fixed income debt securities and strategic investments in non-marketable equity and other securities and non-financial assets such as goodwill and intangible assets.

Fixed income debt securities are recorded at amortized cost and approximate fair value.

The fair value of fixed income debt securities is determined based on observable market prices in a less active market or based on valuation methodologies using observable inputs.

If measured at fair value in the Consolidated Statements of Financial Position, these securities would generally be classified as Level 2 in the fair value hierarchy.

See Note 4 of the Notes to the Consolidated Financial Statements for additional information about the Company’s fixed income debt securities.

Strategic investments in non-marketable equity and other securities and certain non-financial assets such as goodwill and intangibles are measured at fair value only if they are deemed to be impaired or when there is an adjustment from observable price changes in the current period.

If measured at fair value in the Consolidated Statements of Financial Position, these securities would generally be classified as Level 3 in the fair value hierarchy.

See Note 4 and Note 9 of the Notes to the Consolidated Financial Statements for additional information about the Company’s investments and goodwill and intangible assets, respectively.

Carrying Value and Estimated Fair Value of Outstanding Debt — The following table presents the carrying value and estimated fair value of the Company’s outstanding debt as described in Note 7 of the Notes to the Consolidated Financial Statements, including the current portion, as of the dates indicated:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

Carrying Value Fair Value Carrying Value Fair Value

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Senior Notes $ 15.0 $ 15.0 $ 15.5 $ 15.8

Legacy Notes and Debentures $ 0.9 $ 1.0 $ 0.9 $ 1.0

Legacy Notes $ 0.9 $ 1.0 $ 0.9 $ 1.0

DFS Debt $ 8.7 $ 8.5 $ 9.5 $ 9.1

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All equity and other securities as well as long-term fixed income debt securities are recorded as long-term investments while short-term fixed income debt securities are recorded as other current assets in the Consolidated Statements of Financial Position.

As of both February 2, 2024 and February 3, 2023, total investments were $ 1.6 billion.

As of January 31, 2025 and February 2, 2024, total investments were $ 1.5 billion and $ 1.6 billion, respectively.

Equity and Other Securities

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Investments in marketable securities are measured at fair value on a recurring basis.

Investments in non-marketable equity and other securities represent primarily early-stage companies without readily determinable fair values.

The Company has elected to apply the measurement alternative for non-marketable securities.

Under the alternative, the Company measures investments without readily determinable fair values at cost, less impairment, adjusted by observable price changes.

Under the alternative, the Company measures investments without readily determinable fair values at cost, less impairment, adjusted for observable price changes.

The Company makes a separate election to use the alternative for each eligible investment and is required to reassess at each reporting period whether an investment qualifies for the alternative.

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Carrying Value of Equity and Other Securities

The following table presents the cost, cumulative unrealized gains, cumulative unrealized losses, and carrying value of the Company's strategic investments in marketable and non-marketable equity securities as of the dates indicated:

February 2, 2024 February 3, 2023

The following table presents the cost, cumulative unrealized gain, cumulative unrealized loss, and carrying value of the Company's strategic investments in marketable and non-marketable equity and other securities as of the dates indicated:

January 31, 2025 February 2, 2024

Cost Unrealized Gain Unrealized Loss Carrying Value Cost Unrealized Gain Unrealized Loss Carrying Value

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Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

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____________________

(a) For the fiscal year ended February 2, 2024 and January 28, 2022, net unrealized gains on non-marketable securities were due to upward adjustments for observable price changes offset by losses primarily attributable to downward adjustments for observable price changes or impairments.

(a) For the fiscal year ended January 31, 2025 and February 2, 2024, net unrealized gains on non-marketable securities were due to upward adjustments for observable price changes offset by losses primarily attributable to downward adjustments for observable price changes and impairments.

(b) For the fiscal year ended February 3, 2023, net unrealized losses on non-marketable securities were primarily attributable to the recognition of impairments which were generally in line with extended public equity market declines.

Fixed Income Debt Securities

The Company has fixed income debt securities carried at amortized cost which are primarily held as collateral for borrowings.

The Company intends to hold the investments to maturity.

As of February 2, 2024, the Company held $ 288 million in fixed income debt securities which will mature within one year and $ 13 million in fixed income debt securities which will mature within five years.

The following table summarizes the Company’s debt securities as of the dates indicated:

February 2, 2024 February 3, 2023

Cost Unrealized Gain Unrealized Loss Carrying Value Cost Unrealized Gain Unrealized Loss Carrying Value

(in millions)

Fixed income debt securities $ 325 $ 67 $ ( 91 ) $ 301 $ 348 $ 65 $ ( 95 ) $ 318

As of January 31, 2025 and February 2, 2024, the Company held fixed income debt securities of $ 27 million and $ 301 million, respectively, which it intends to hold to maturity.

These investments are recorded at amortized cost and approximate fair value.

As of January 31, 2025, the Company held $ 26 million in fixed income debt securities which will mature within one year and $ 1 million in fixed income debt securities which will mature within five years.

DELL TECHNOLOGIES INC.

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NOTE 5 — FINANCIAL SERVICES

The Company offers or arranges various financing options and alternative payment structures for its customers globally.

Alternative payment structures consist of various flexible consumption models, including utility, subscription, and as-a-Service models.

Financing options are offered to the Company’s customers primarily through Dell Financial Services and its affiliates (“DFS”).

The Company also arranges financing for some of its customers in various countries where DFS does not currently operate as a captive enterprise.

The key activities of DFS include originating, collecting, and servicing customer financing arrangements primarily related to the purchase or use of Dell Technologies products and services.

In some cases, DFS also offers financing for the purchase of third-party technology products that complement the Dell Technologies portfolio of products and services.

New financing originations were $ 8.4 billion, $ 9.7 billion, and $ 8.5 billion for the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022, respectively.

The Company’s lease and loan arrangements with customers are aggregated primarily into the following categories:

The Company offers or arranges a portfolio of payment and consumption solutions and services for its customers globally, including as-a-Service, subscription, utility, leases, and loans designed to match customers' consumption and financing preferences, and provide operational and financial flexibility.

To support financing solutions and services as part of the portfolio, DFS originates, collects, and services customer financing arrangements primarily related to the purchase and use of Dell Technologies products and services.

In some cases, the Company also offers financing for the purchase of third-party technology products that complement the Dell Technologies portfolio of products and services.

New financing originations were $ 8.4 billion for the fiscal years ended January 31, 2025 and February 2, 2024 and $ 9.7 billion for the fiscal year ended February 3, 2023.

The Company’s financing arrangements with customers are aggregated primarily into the following categories:

Fixed-term leases and loans — The Company enters into financing arrangements with customers who seek lease financing for equipment.

DFS leases are generally classified as sales-type leases or operating leases.

Leases are generally classified as sales-type leases or operating leases.

Additionally, utility, subscription, and as-a-Service flexible consumption models may result in identification of embedded lease arrangements that lead to the recognition of sales-type leases or operating leases.

Leases with business customers have fixed terms of generally two to four years .

3 unchanged sentences

The carrying value of these loans approximates fair value.

Revolving loans — Revolving loans offered under a private label credit financing program, referred to as Dell Business Credit (“DBC”), provide qualified customers with a revolving credit line for the purchase of products and services offered by Dell Technologies.

The DBC product is primarily offered to small and medium-sized commercial customers.

Revolving loans — The Company primarily offered revolving loans to small and medium-sized commercial customers.

Revolving loans provide qualified customers with a revolving credit line for the purchase of products and services offered by Dell Technologies.

Revolving loans in the United States bear interest at a variable annual percentage rate that is tied to the prime rate.

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Prior to the sale of the U.S.

consumer revolving customer receivables portfolio described in Note 1 of the Notes to the Consolidated Financial Statements, the Company also offered private label credit financing under the Dell Preferred Account (“DPA”) program.

consumer revolving customer receivables portfolio on October 4, 2023 described in Note 1 of the Notes to the Consolidated Financial Statements, the Company offered private label credit financing under the Dell Preferred Account (“DPA”) program.

The DPA product was primarily offered to individual consumer customers.

Flexible consumption models, as defined above, further enable the Company to offer its customers the option to pay over time to provide them with financial and operational flexibility.

Such models may result in identification of embedded lease arrangements that lead to the recognition of operating or sales-type leases.

During the fiscal year ended January 31, 2025, the Company discontinued remaining offerings under the revolving loan portfolio.

The Company will support existing customer arrangements as well as transition these customers to fixed-term offerings.

DELL TECHNOLOGIES INC.

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The following table presents the components of the Company’s financing receivables segregated by portfolio segment as of the dates indicated:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

Revolving Fixed-term Total Revolving Fixed-term Total

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Financing receivables, net:

Customer receivables, gross (a) (b) $ 173 $ 10,360 $ 10,533 $ 685 $ 10,293 $ 10,978

Customer receivables, gross (a) $ 86 $ 11,130 $ 11,216 $ 173 $ 10,360 $ 10,533

Allowances for losses ( 6 ) ( 147 ) ( 153 ) ( 9 ) ( 161 ) ( 170 )

6 unchanged sentences

(a) Customer receivables, gross include amounts due from customers under revolving loans, fixed-term loans, fixed-term leases, and accrued interest.

(b) The decrease in revolving customer financing receivables is primarily attributable to the sale of the U.S.

consumer revolving customer receivables portfolio described in Note 1 of the Notes to the Consolidated Financial Statements.

The following table presents the changes in allowance for financing receivables losses for the periods indicated:

Revolving Fixed-term Total

The following table presents the changes in allowance for financing receivable losses for the periods indicated:

Fiscal Year Ended

January 31, 2025 February 2, 2024 February 3, 2023

Revolving Fixed-term Total Revolving Fixed-term Total Revolving Fixed-term Total

(in millions)

Allowance for financing receivables losses:

Balances as of January 29, 2021 $ 148 $ 173 $ 321

Charge-offs, net of recoveries ( 43 ) ( 29 ) ( 72 )

Provision charged to income statement ( 3 ) ( 57 ) ( 60 )

Balances as of January 28, 2022 102 87 189

Charge-offs, net of recoveries ( 52 ) ( 8 ) ( 60 )

Provision charged to income statement 38 34 72

Balances as of February 3, 2023 88 113 201

Allowance for financing receivable losses:

Balances at beginning of period $ 9 $ 161 $ 170 $ 88 $ 113 $ 201 $ 102 $ 87 $ 189

Charge-offs, net of recoveries ( 12 ) ( 59 ) ( 71 ) ( 41 ) ( 8 ) ( 49 ) ( 52 ) ( 8 ) ( 60 )

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Other (a) — — — ( 74 ) — ( 74 ) — — —

Balances as of February 2, 2024 $ 9 $ 161 $ 170

Balances at end of period $ 6 $ 147 $ 153 $ 9 $ 161 $ 170 $ 88 $ 113 $ 201

____________________

(a) Other represents the derecognition of the allowance for financing receivables losses related to the sale of the U.S.

(a) Other represents the derecognition of the allowance for financing receivable losses related to the sale of the U.S.

consumer revolving customer receivables portfolio described in Note 1 of the Notes to the Consolidated Financial Statements.

The Company recognizes an allowance for financing receivables losses, including both the lease receivable and unguaranteed residual, in an amount equal to the expected losses net of recoveries.

The Company recognizes an allowance for financing receivable losses, including both the lease receivable and unguaranteed residual, in an amount equal to the expected losses net of recoveries.

The Company continues to monitor broader economic indicators and their potential impact on future credit loss performance.

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The following table presents the aging of the Company’s customer financing receivables, gross, including accrued interest, segregated by class, as of the dates indicated:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

Current Past Due

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(in millions)

Revolving — DPA $ 3 $ — $ — $ 3 $ 457 $ 34 $ 17 $ 508

Revolving — DBC 148 17 5 170 154 19 4 177

Fixed-term — Consumer and Commercial 9,345 889 126 10,360 9,309 927 57 10,293

Revolving $ 69 $ 12 $ 5 $ 86 $ 151 $ 17 $ 5 $ 173

Fixed-term 10,727 189 214 11,130 9,345 889 126 10,360

Total customer receivables, gross $ 10,796 $ 201 $ 219 $ 11,216 $ 9,496 $ 906 $ 131 $ 10,533

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As a result of these factors, fluctuations in aging from period to period do not necessarily indicate a material change in the collectibility of the portfolio.

Fixed-term consumer and commercial customer receivables are placed on non-accrual status if principal or interest is past due and considered delinquent, or if there is concern about the collectibility of a specific customer receivable.

Fixed-term customer receivables are placed on non-accrual status if principal or interest is past due and considered delinquent, or if there is concern about the collectibility of a specific customer receivable.

The receivables identified as doubtful for collectibility may be classified as current for aging purposes.

Aged revolving portfolio customer receivables identified as delinquent are charged off.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Credit Quality

The following tables present customer receivables, gross, including accrued interest, by credit quality indicator, segregated by class, as of the dates indicated:

February 2, 2024

Fixed-term — Consumer and Commercial

Fiscal Year of Origination

2024 2023 2022 2021 2020 Years Prior Revolving — DPA Revolving — DBC Total

January 31, 2025

Fixed-term — Fiscal Year of Origination

2025 2024 2023 2022 2021 Years Prior Revolving Total

(in millions)

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February 2, 2024

Fixed-term — Consumer and Commercial

Fiscal Year of Origination

2023 2022 2021 2020 2019 Years Prior Revolving — DPA Revolving — DBC Total

Fixed-term — Fiscal Year of Origination

2024 2023 2022 2021 2020 Years Prior Revolving Total

(in millions)

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The categories shown in the tables above segregate customer receivables based on the relative degrees of credit risk.

Credit quality indicators for DBC revolving and fixed-term accounts are generally updated on a periodic basis.

For the DBC revolving receivables and fixed-term commercial receivables shown in the table above, an internal grading system is utilized that assigns a credit level score based on a number of considerations, including liquidity, operating performance, and industry outlook.

The grading criteria and classifications for the fixed-term products differ from those for the revolving products as loss experience varies between these product and customer groups.

The credit quality categories cannot be compared between the different classes as loss experience varies substantially between the classes.

Prior to the sale of the U.S.

consumer revolving customer receivables revolving portfolio described in Note 1 of the Notes to the Consolidated Financial Statements, the Company made credit decisions for the DPA revolving receivables based on proprietary scorecards, which included the customer’s credit history, payment history, credit usage, and other credit agency-related elements.

The higher quality category included prime accounts generally comparable to U.S.

customer FICO scores of 720 or above.

The mid category represented mid-tier accounts that are comparable to U.S.

customer FICO scores from 660 to 719.

The lower category represented accounts that are comparable to U.S.

customer FICO scores below 660.

Credit quality indicators for revolving and fixed-term accounts are generally updated on a periodic basis.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

An internal grading system is utilized that assigns a credit level score based on a number of considerations, including liquidity, operating performance, and industry outlook.

The grading criteria and classifications for the fixed-term products differ from those for the revolving products as loss experience varies between these product and customer groups.

The credit quality categories cannot be compared between the different classes as loss experience varies substantially between the classes.

The following table presents amounts included in the Consolidated Statements of Income related to sales-type lease activity for the periods indicated:

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

4 unchanged sentences

Cost of net revenue — products

1,703 854 727

Gross margin — products

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The following table presents the future maturity of the Company’s fixed-term customer leases and associated financing payments, and reconciles the undiscounted cash flows to the customer receivables, gross recognized on the Consolidated Statements of Financial Position as of the date indicated:

February 2, 2024

January 31, 2025

(in millions)

3 unchanged sentences

Fiscal 2029 477

Fiscal 2029 and beyond 153

Fiscal 2030 and thereafter 218

Total undiscounted cash flows 7,316

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Operating Leases

The Company’s operating leases primarily consist of DFS captive fixed-term leases and contractually committed embedded leases identified within flexible consumption arrangements.

The Company’s operating leases primarily consist of fixed-term leases and contractually committed embedded leases identified within flexible consumption arrangements.

The following table presents the components of the Company’s operating lease portfolio included in property, plant, and equipment, net as of the dates indicated:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

(in millions)

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Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

2 unchanged sentences

The following table presents the future payments to be received by the Company in operating lease contracts as of the date indicated:

February 2, 2024

January 31, 2025

(in millions)

3 unchanged sentences

Fiscal 2029 141

Fiscal 2029 and beyond 52

Fiscal 2030 and thereafter 42

Total $ 2,577

The Company maintains programs that facilitate the funding of leases, loans, and other alternative payment structures in the capital markets.

The majority of DFS debt is non-recourse to Dell Technologies and represents borrowings under securitization programs and structured financing programs, for which the Company’s risk of loss is limited to transferred loan and lease payments and associated equipment.

The majority of DFS debt is non-recourse to Dell Technologies and represents borrowings under securitization programs and structured financing programs for which the Company’s risk of loss is limited to transferred lease and loan payments and associated equipment.

The following table presents DFS debt as of the dates indicated and excludes the allocated portion of the Company’s other borrowings, which represents the additional amount considered to fund the DFS business:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

DFS debt (in millions)

Asset-based financing and securitization facilities $ 2,730 $ 3,987

Asset-based financing facility $ 3,018 $ 2,730

Fixed-term securitization offerings 2,756 3,157

Total DFS U.S.

debt 5,915 6,742

debt, principal amount 5,774 5,915

DFS international debt:

3 unchanged sentences

Dell Bank senior unsecured eurobonds 1,559 1,631

Total DFS international debt 3,577 3,548

Total DFS debt $ 9,492 $ 10,290

Total DFS international debt, principal amount 2,937 3,577

Total DFS debt, principal amount $ 8,711 $ 9,492

Total short-term DFS debt $ 5,175 $ 5,863

2 unchanged sentences

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Asset-Based Financing and Securitization Facilities — The Company maintains separate asset-based financing facilities in the United States, which are revolving facilities for fixed-term leases and loans.

Asset-Based Financing Facility — The Company maintains an asset-based financing facility in the United States, which is a revolving facility for fixed-term leases and loans.

This debt is collateralized solely by the U.S.

loan and lease payments and associated equipment in the facilities.

The debt has a variable interest rate, and the duration of the debt is based on the terms of the underlying loan and lease payment streams.

As of February 2, 2024, the total debt capacity related to the U.S.

asset-based financing facilities was $ 5.1 billion.

The Company enters into interest swap agreements to effectively convert a portion of this debt from a floating rate to a fixed rate.

lease and loan payments and associated equipment in the facility.

The asset-based financing facility consists of two tranches, with effective dates through July 7, 2025 and July 7, 2026, respectively.

As of January 31, 2025, the total debt capacity related to the asset-based financing facility was $ 5.0 billion.

The debt has a variable interest rate, and the duration of the debt is based on the terms of the underlying lease and loan payment streams.

The Company enters into interest rate swap agreements to economically convert a portion of this debt from a floating rate to a fixed rate.

See Note 8 of the Notes to the Consolidated Financial Statements for additional information about the Company’s interest rate swaps.

The Company’s two U.S.

asset-based financing facilities for fixed-term leases and loans are effective through July 7, 2025 and June 21, 2024, respectively.

The asset-based financing facilities contain standard structural features related to the performance of the funded receivables, which include defined credit losses, delinquencies, average credit scores, and minimum collection requirements.

The asset-based financing facility contains standard structural features related to the performance of the funded receivables, which include defined credit losses, delinquencies, average credit scores, and minimum collection requirements.

In the event one or more of these criteria are not met and the Company is unable to restructure the facility, no further funding of receivables will be permitted and the timing of the Company’s expected cash flows from over-collateralization will be delayed.

As of February 2, 2024, these criteria were met.

The Company previously maintained a U.S.

securitization facility for revolving loans.

In connection with the sale of the U.S.

consumer revolving customer receivables portfolio described in Note 1 of the Notes to the Consolidated Financial Statements, the Company’s U.S.

securitization facility for revolving loans was paid down and terminated during the fiscal year ended February 2, 2024.

As of January 31, 2025, these criteria were met.

Fixed-Term Securitization Offerings — The Company periodically issues asset-backed debt securities under fixed-term securitization programs to private investors.

1 unchanged sentence

fixed-term lease and loan payments and associated equipment, which are held by Special Purpose Entities (“SPEs”), as discussed below.

The interest rate on these securities is fixed and ranges from 0.53 % to 6.80 % per annum as of February 2, 2024, and the duration of these securities is based on the terms of the underlying lease and loan payment streams.

The interest rate on these securities is fixed and ranges from 4.14 % to 6.80 % per annum as of January 31, 2025, and the duration of these securities is based on the terms of the underlying lease and loan payment streams.

DFS International Debt

Securitization Facility — The Company maintains a securitization facility in Europe for fixed-term leases and loans.

The debt under this facility has a variable interest rate, and the duration of the debt is based on the terms of the underlying loan and lease payment streams.

This facility is effective through December 23, 2024 and had a total debt capacity of $ 870 million as of February 2, 2024.

The debt under this facility has a variable interest rate, and the duration of the debt is based on the terms of the underlying lease and loan payment streams.

This facility is effective through December 22, 2026 and had a total debt capacity of $ 831 million as of January 31, 2025.

The securitization facility contains standard structural features related to the performance of the securitized receivables, which include defined credit losses, delinquencies, average credit scores, and minimum collection requirements.

In the event one or more of these criteria are not met and the Company is unable to restructure the program, no further funding of receivables will be permitted and the timing of the Company’s expected cash flows from over-collateralization will be delayed.

As of February 2, 2024, these criteria were met.

Other Borrowings — In connection with the Company’s international financing operations, the Company has entered into revolving structured financing debt programs related to its fixed-term lease and loan products sold in Canada, Europe, Australia, New Zealand, and the Middle East.

The debt under these programs has a variable interest rate, and the duration of the debt is based on the terms of the underlying loan and lease payment streams.

The Canadian facility, which is collateralized solely by Canadian loan and lease payments and associated equipment, had a total debt capacity of $ 336 million as of February 2, 2024 and is effective through January 16, 2025.

The European facility, which is collateralized solely by European loan and lease payments and associated equipment, had a total debt capacity of $ 544 million as of February 2, 2024 and is effective through June 14, 2025.

The Australia and New Zealand facility, which is collateralized solely by Australia and New Zealand loan and lease payments and associated equipment, had a total debt capacity of $ 296 million as of February 2, 2024 and is effective through April 20, 2025.

The Middle East facility, which is collateralized solely by Middle East loan and lease payments and associated equipment, had a total debt capacity of $ 150 million as of February 2, 2024 and is effective through March 24, 2025.

As of January 31, 2025, these criteria were met.

The debt under these programs has a variable interest rate.

The duration of the debt in Canada, Europe, Australia, New Zealand, and the Middle East is based on the terms of the underlying lease and loan payment streams.

These facilities are collateralized solely by the lease and loan payments and associated equipment in their respective region or country.

The Canadian facility had a total debt capacity of $ 242 million as of January 31, 2025 and is effective through January 15, 2028.

The European facility had a total debt capacity of $ 520 million as of January 31, 2025 and is effective through December 14, 2026.

The Australia and New Zealand facility had a total debt capacity of $ 279 million as of January 31, 2025 and is effective through April 20, 2025.

The Middle East facility had a total debt capacity of $ 150 million as of January 31, 2025 and was effective through March 24, 2025.

Subsequent to the close of the fiscal year ended January 31, 2025, the Company extended the term of the Middle East facility to be effective through March 14, 2027.

The Company also has two unsecured Singapore facilities with a total debt capacity of $ 244 million as of January 31, 2025 that are effective through July 3, 2026 and July 3, 2027, respectively.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Note Payable — On May 25, 2022, the Company entered into an unsecured credit agreement to fund receivables in Mexico.

As of February 2, 2024, the aggregate principal amount of the note payable was $ 250 million.

The note bears interest at an annual rate of 4.24 % and will mature on May 31, 2024.

Dell Bank Senior Unsecured Eurobonds — On June 24, 2020, Dell Bank issued 500 million Euro of 1.625 % senior unsecured four year eurobonds due June 2024.

On October 27, 2021, Dell Bank issued 500 million Euro of 0.5 % senior unsecured five year eurobonds due October 2026.

Note Payable — On May 25, 2022, the Company entered into an unsecured credit agreement which had an aggregate principal amount of $ 250 million to fund receivables in Mexico.

The note bore interest at an annual rate of 4.24 % and was paid in full on May 31, 2024.

Dell Bank Senior Unsecured Eurobonds — On October 27, 2021, Dell Bank issued 500 million Euro of 0.5 % senior unsecured five year eurobonds due October 2026.

On October 18, 2022, Dell Bank issued 500 million Euro of 4.5 % senior unsecured five year eurobonds due October 2027.

On June 13, 2024, Dell Bank issued 500 million Euro of 3.6 % senior unsecured five year eurobonds due June 2029.

The issuances of the senior unsecured eurobonds support the expansion of the financing operations in Europe.

Variable Interest Entities

In connection with the asset-based financing facilities, securitization facilities, and fixed-term securitization offerings discussed above, the Company transfers certain U.S.

In connection with the asset-based financing facility, securitization facility, and fixed-term securitization offerings discussed above, the Company transfers certain U.S.

and European lease and loan payments and associated equipment to SPEs that meet the definition of a VIE and are consolidated, along with the associated debt described above, into the Consolidated Financial Statements, as the Company is the primary beneficiary of the VIEs.

The SPEs are bankruptcy-remote legal entities with separate assets and liabilities.

The purpose of the SPEs is to facilitate the funding of customer loan and lease payments and associated equipment in the capital markets.

The purpose of the SPEs is to facilitate the funding of customer lease and loan payments and associated equipment in the capital markets.

Some of the SPEs have entered into financing arrangements with multi-seller conduits that, in turn, issue asset-backed debt securities in the capital markets.

3 unchanged sentences

The following table presents the assets and liabilities held by the consolidated VIEs as of the dates indicated, which are included in the Consolidated Statements of Financial Position:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

(in millions)

9 unchanged sentences

Long-term $ 1,788 $ 2,184

Lease and loan payments and associated equipment transferred via securitization through SPEs were $ 4.6 billion and $ 6.2 billion for the fiscal years ended February 2, 2024 and February 3, 2023, respectively.

Lease and loan payments and associated equipment transferred via securitization through SPEs were $ 3.6 billion and $ 4.6 billion for the fiscal years ended January 31, 2025 and February 2, 2024, respectively.

Customer Receivables Sales

To manage certain concentrations of customer credit exposure, the Company may sell selected fixed-term customer receivables to unrelated third parties on a periodic basis, without recourse.

The amount of customer receivables sold for this purpose was $ 222 million, $ 680 million, and $ 201 million for the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022, respectively.

The amount of customer receivables sold for this purpose was $ 79 million, $ 222 million, and $ 680 million for the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023, respectively.

The Company’s continuing involvement in these customer receivables is primarily limited to servicing arrangements.

6 unchanged sentences

The Company also leases certain global logistics warehouses, employee vehicles, and equipment.

As of February 2, 2024, the remaining terms of the Company’s leases range from one month to approximately ten years .

As of February 2, 2024 and February 3, 2023, there were no material finance leases in which the Company was a lessee.

The Company also enters into leasing transactions in which the Company is the lessor, primarily through customer financing arrangements offered through DFS.

As of January 31, 2025, the remaining terms of the Company’s leases range from one month to approximately eleven years .

As of January 31, 2025 and February 2, 2024, there were no material finance leases in which the Company was a lessee.

The Company also enters into leasing transactions in which the Company is the lessor, primarily through customer financing arrangements offered under DFS.

DFS originates leases that are primarily classified as either sales-type leases or operating leases.

2 unchanged sentences

Fiscal Year Ended

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

2 unchanged sentences

Total lease costs $ 355 $ 371 $ 396

During the fiscal years ended February 2, 2024 and February 3, 2023, sublease income, finance lease costs, and short-term lease costs were immaterial.

During the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023, sublease income, finance lease costs, and short-term lease costs were immaterial.

The following table presents supplemental information related to operating leases included in the Consolidated Statements of Financial Position as of the dates indicated:

Classification February 2, 2024 February 3, 2023

Classification January 31, 2025 February 2, 2024

(in millions, except for term and discount rate)

9 unchanged sentences

Fiscal Year Ended

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

2 unchanged sentences

The following table presents the future maturity of the Company’s operating lease liabilities under non-cancelable leases and reconciles the undiscounted cash flows for these leases to the lease liability recognized on the Consolidated Statements of Financial Position as of the date indicated:

February 2, 2024

January 31, 2025

(in millions)

9 unchanged sentences

Non-current operating lease liabilities $ 522

As of February 2, 2024, the Company’s undiscounted operating leases that had not yet commenced were immaterial.

As of January 31, 2025, the Company’s undiscounted operating leases that had not yet commenced were immaterial.

DELL TECHNOLOGIES INC.

2 unchanged sentences

The following table summarizes the Company’s outstanding debt as of the dates indicated:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

(in millions)

Senior Notes $ 15,073 $ 15,607

5.45 % due June 2023

4.00 % due July 2024

5.85 % due July 2025

6.02 % due June 2026

4.90 % due October 2026

6.10 % due July 2027

5.25 % due February 2028

5.30 % due October 2029

6.20 % due July 2030

5.75 % due February 2033

8.10 % due July 2036

3.38 % due December 2041

8.35 % due July 2046

3.45 % due December 2051

Legacy Notes and Debentures:

7.10 % due April 2028

6.50 % due April 2038

5.40 % due September 2040

Legacy Notes 952 952

DFS Debt (Note 5)

Other 171 325

Total debt, principal amount 24,788 26,222

4 unchanged sentences

Total long-term debt, carrying value $ 19,363 $ 19,012

During the fiscal year ended February 2, 2024, the net decrease in the Company’s debt balance was principally attributable to:

• the repayment of $ 1.0 billion principal amount of the 5.45 % Senior Notes due June 2023;

• the repayment of $ 1.0 billion principal amount of the 6.02 % Senior Notes due June 2026 in a tender offer;

• the repayment of $ 350 million principal amount of the 3.45 % Senior Notes due December 2051 and $ 150 million principal amount of the 8.35 % Senior Notes due July 2046 in a tender offer.

The Company recognized an immaterial amount of debt extinguishment costs in interest and other, net in the Consolidated Statements of Income in connection with the above repayments.

Subsequent to the close of the fiscal year ended February 2, 2024, the Company issued $ 1.0 billion aggregate principal amount of 5.40 % Senior Notes due 2034.

The Company intends to use the net proceeds of the issuance to prepay a portion of the outstanding 6.02 % Senior Notes due 2026.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company completed the following transactions during the fiscal year ended January 31, 2025:

• the issuance of $ 1 billion principal amount of 5.40 % Senior Notes due April 2034, the proceeds of which were utilized to prepay a portion of the outstanding 6.02 % Senior Notes due June 2026;

• the repayment of $ 1 billion principal amount of the 4.00 % Senior Notes due July 2024;

• the issuance of $ 0.7 billion principal amount of 4.35 % Senior Notes due February 2030 and $ 0.8 billion principal amount of 4.85 % Senior Notes due February 2035, the proceeds of which were utilized to redeem the 5.85 % Senior Notes due July 2025.

Outstanding Debt

Senior Notes — The Company completed offerings of multiple series of senior notes which were issued on June 1, 2016, June 22, 2016, March 20, 2019, April 9, 2020, December 13, 2021, and January 24, 2023 in aggregate principal amounts of $ 20.0 billion, $ 3.3 billion, $ 4.5 billion, $ 2.3 billion, $ 2.3 billion, and $ 2.0 billion, respectively (the “Senior Notes”).

Interest on these borrowings is payable semiannually.

Legacy Notes and Debentures — The Company has outstanding unsecured notes and debentures (collectively, the “Legacy Notes and Debentures”) that were issued by Dell Inc.

Senior Notes — The Company completed offerings of multiple series of senior notes which were issued on June 1, 2016, June 22, 2016, March 20, 2019, April 9, 2020, December 13, 2021, January 24, 2023, March 18, 2024, and October 8, 2024 in aggregate principal amounts of $ 20.0 billion, $ 3.3 billion, $ 4.5 billion, $ 2.3 billion, $ 2.3 billion, $ 2.0 billion, $ 1.0 billion, and $ 1.5 billion, respectively (collectively, the “Senior Notes”).

The Senior Notes’ maturities range from 2026 through 2051.

Interest rates on these borrowings are fixed, ranging from 3.38 % to 8.35 %, and interest is payable semiannually.

Legacy Notes — The Company has outstanding unsecured notes and debentures (collectively, the “Legacy Notes”) that were issued by Dell Inc.

(“Dell”), a wholly-owned subsidiary of Dell Technologies Inc., prior to the acquisition of Dell by Dell Technologies Inc.

in the going-private transaction that closed in October 2013.

Interest on these borrowings is payable semiannually.

The Legacy Notes’ maturities range from 2028 through 2040.

Interest rates on these borrowings are fixed, ranging from 5.40 % to 7.10 %, and interest is payable semiannually.

DFS Debt — See Note 5 and Note 8 of the Notes to the Consolidated Financial Statements, respectively, for discussion of DFS debt and the interest rate swap agreements that hedge a portion of that debt.

2021 Revolving Credit Facility — The Company’s revolving credit facility, which was entered into on November 1, 2021 (the “2021 Revolving Credit Facility”), matures on November 1, 2027.

This facility provides the Company with revolving commitments in an aggregate principal amount of $ 6.0 billion for general corporate purposes, including liquidity support for the Company’s commercial paper program, and includes a letter of credit sub-facility of up to $ 0.5 billion and a swing-line loan sub-facility of up to $ 0.5 billion.

Revolving Credit Facility — The Company’s revolving credit facility provides the Company with revolving commitments in an aggregate principal amount of $ 6.0 billion for general corporate purposes and includes a letter of credit sub-facility of up to $ 0.5 billion and a swing-line loan sub-facility of up to $ 0.5 billion.

The revolving credit facility also allows the Company to obtain incremental additional commitments on one or more occasions in minimum amounts of $ 10 million.

2 unchanged sentences

The base rate is calculated based upon the greatest of the specified prime rate, the specified federal reserve bank rate, or SOFR plus 1 %.

The borrowers may voluntarily repay outstanding loans under the 2021 Revolving Credit Facility at any time without premium or penalty, other than customary breakage costs.

As of February 2, 2024, the Company had no outstanding borrowings under the 2021 Revolving Credit Facility.

Commercial Paper Program — During Fiscal 2023, the Company established a commercial paper program under which the Company may issue unsecured notes in a maximum aggregate face amount of $ 5.0 billion outstanding at any time, with maturities up to 397 days from the date of issuance.

The borrowers may voluntarily repay outstanding loans at any time without premium or penalty, other than customary breakage costs.

The facility matures on November 1, 2027.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

As of January 31, 2025, the Company had no outstanding borrowings under the revolving credit facility.

Commercial Paper Program — The Company maintains a commercial paper program under which the Company may issue unsecured notes in a maximum aggregate face amount of $ 5.0 billion outstanding at any time, with maturities of up to 397 days from the date of issuance.

The notes are sold on customary terms in the U.S.

1 unchanged sentence

The proceeds of the notes are used for general corporate purposes.

As of February 2, 2024, the Company had no outstanding borrowings under the commercial paper program.

As of January 31, 2025, the Company had no outstanding issuances under the commercial paper program.

The Company may purchase, redeem, prepay, refinance, or otherwise retire any amount of outstanding indebtedness under the terms of such indebtedness at any time and from time to time, in open market or negotiated transactions with the holders of such indebtedness or otherwise, as considered appropriate in light of market conditions and other relevant factors.

Covenants — The credit agreement governing the 2021 Revolving Credit Facility and the indentures governing the Senior Notes and the Legacy Notes and Debentures impose various limitations, subject to exceptions, on creating certain liens and entering into sale and lease-back transactions.

The foregoing credit agreement and indentures contain customary events of default, including failure to make required payments, failure to comply with covenants, and the occurrence of certain events of bankruptcy and insolvency.

The 2021 Revolving Credit Facility is also subject to an interest coverage ratio covenant that is tested at the end of each fiscal quarter with respect to the Company’s preceding four fiscal quarters.

The Company was in compliance with this financial covenant as of February 2, 2024.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Covenants — The credit agreement governing the revolving credit facility and the indentures governing the Senior Notes and the Legacy Notes impose various limitations, subject to exceptions, on creating certain liens and entering into sale and lease-back transactions.

The foregoing credit agreement and indentures contain customary events of default, and the revolving credit facility is subject to an interest coverage ratio covenant that is tested at the end of each fiscal quarter with respect to the Company’s preceding four fiscal quarters.

The Company was in compliance with this financial covenant as of January 31, 2025.

Aggregate Future Maturities

The following table presents the aggregate future maturities of the Company’s debt as of February 2, 2024 for the periods indicated:

Maturities by Fiscal Year

2025 2026 2027 2028 2029 Thereafter Total

The following table presents the aggregate future maturities of the Company’s debt as of January 31, 2025, excluding associated carrying value adjustments, for the periods indicated:

January 31, 2025

(in millions)

Senior Notes $ 1,000 $ 1,000 $ 5,250 $ 500 $ 1,000 $ 6,857 $ 15,607

Legacy Notes and Debentures — — — — 300 652 952

DFS Debt 5,863 2,127 878 618 6 — 9,492

Other 125 31 8 6 1 — 171

Fiscal 2026 $ 5,208

Fiscal 2027 6,384

Fiscal 2028 1,315

Fiscal 2029 1,372

Fiscal 2030 2,984

Thereafter 7,525

Total maturities, principal amount $ 24,788

Associated carrying value adjustments ( 6 ) ( 6 ) ( 33 ) ( 8 ) ( 14 ) ( 161 ) ( 228 )

Total maturities, carrying value amount $ 6,982 $ 3,152 $ 6,103 $ 1,116 $ 1,293 $ 7,348 $ 25,994

DELL TECHNOLOGIES INC.

3 unchanged sentences

The Company’s objective is to offset gains and losses resulting from these exposures with gains and losses on the derivative contracts used to hedge the exposures, thereby reducing volatility of earnings and protecting the fair values of assets and liabilities.

The earnings effects of the derivative instruments are presented in the same income statement line items as the earnings effects of the hedged items.

The earnings effects of the derivative instruments are presented in the same line items on the Consolidated Statements of Income as the earnings effects of the hedged items.

For derivatives designated as cash flow hedges, the Company assesses hedge effectiveness both at the onset of the hedge and at regular intervals throughout the life of the instruments.

6 unchanged sentences

The majority of these contracts typically expire in twelve months or less.

During the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022, the Company did not discontinue any cash flow hedges related to foreign exchange contracts that had a material impact on the Company’s results of operations due to the probability that the forecasted cash flows would not occur.

During the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023, the Company did not discontinue any cash flow hedges related to foreign exchange contracts that had a material impact on the Company’s results of operations due to the probability that the forecasted cash flows would not occur.

The Company uses forward contracts to hedge monetary assets and liabilities denominated in a foreign currency.

8 unchanged sentences

Interest rate swaps are utilized to manage the interest rate risk, at a portfolio level, associated with DFS operations in Europe.

The interest rate swaps economically convert the fixed rate on financing receivables to a three-month Euribor floating rate in order to match the floating rate nature of the banks’ funding pool.

The Company also uses interest rate swaps to manage the cash flows related to interest payments on Eurobonds.

The interest rate swaps economically convert the fixed rate on financing receivables to a one-month or three-month Euribor floating rate in order to match the floating rate nature of the banks’ funding pool.

The Company also uses interest rate swaps to manage the cash flows related to interest payments on senior unsecured eurobonds.

The interest rate swaps economically convert the fixed rate on the Company’s bonds to a floating rate to match the underlying lease repayments profile.

These contracts are not designated for hedge accounting and most expire within five years or less.

See Note 5 of the Notes to the Consolidated Financial Statements for more information about the Dell Bank senior unsecured eurobonds.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company utilizes cross-currency amortizing swaps to hedge the currency and interest rate risk exposure associated with the European securitization program.

1 unchanged sentence

Dollar foreign exchange forward contract in which the Company pays a fixed or floating British Pound or U.S.

Dollar amount and receives a fixed or floating amount in Euros linked to the one-month Euribor.

Dollar amount and receives a fixed or floating amount in Euros linked to the one-month Euribor rate.

The notional value of the swaps amortizes in line with the expected cash flows and run-off of the securitized assets.

The swaps are not designated for hedge accounting and expire within five years or less.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Periodically, the Company also uses interest rate swaps to modify the market risk exposures in connection with long-term debt.

During Fiscal 2023, the Company entered into interest rate swaps designated as fair value hedges intended to hedge a portion of its interest rate exposure by converting the fixed interest rate of a certain tranche of debt to a floating interest rate based on the benchmark SOFR Overnight Index Swap rate.

The gains and losses related to changes in the fair value of such interest rate swaps perfectly offset changes in the fair value of the hedged portion of the underlying debt that were attributable to the changes in the underlying benchmark interest rate.

During the fiscal year ended February 2, 2024, the Company repaid the hedged debt and terminated the associated interest rate swaps.

Derivative Instruments

The following table presents the notional amounts of outstanding derivative instruments as of the dates indicated:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

(in millions)

4 unchanged sentences

Interest rate contracts:

Designated as fair value hedging instruments $ — $ 1,000

Non-designated as hedging instruments $ 6,353 $ 6,551

Total $ 6,551 $ 8,214

The following table presents the effect of derivative instruments designated as cash flow hedging instruments on the Consolidated Statements of Financial Position and the Consolidated Statements of Income for the periods indicated:

Derivatives in Cash Flow Hedging Relationships Gain Recognized in Accumulated OCI, Net of Tax, on Derivatives Location of Gain (Loss) Reclassified from Accumulated OCI into Income Gain (Loss) Reclassified from Accumulated OCI into Income

Derivatives in Cash Flow Hedging Relationships Gain Recognized in Accumulated OCI, Net of Tax, on Derivatives

Location of Gain (Loss) Reclassified from Accumulated OCI into Income Gain (Loss) Reclassified from Accumulated OCI into Income

(in millions) (in millions)

For the fiscal year ended February 2, 2024:

For the fiscal year ended January 31, 2025:

Total net revenue $ 100

5 unchanged sentences

Total $ 85 Total $ ( 107 )

For the fiscal year ended January 28, 2022:

For the fiscal year ended February 3, 2023:

Total net revenue $ 736

Foreign exchange contracts $ 354 Total cost of net revenue ( 31 )

Total $ 374 Income from discontinued operations 3

Total $ 354 Total $ 705

DELL TECHNOLOGIES INC.

2 unchanged sentences

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022 Location of Gain (Loss) Recognized

January 31, 2025 February 2, 2024 February 3, 2023 Location of Gain (Loss) Recognized

(in millions)

1 unchanged sentence

Interest rate contracts 27 — 50 Interest and other, net

Foreign exchange contracts — — 26 Income from discontinued operations

Total $ ( 187 ) $ ( 35 ) $ ( 124 )

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company presents its derivative instruments on a net basis in the Consolidated Statements of Financial Position due to the right of offset by its counterparties under master netting arrangements.

The following tables present the fair value of those derivative instruments presented on a gross basis as of the dates indicated:

February 2, 2024

Other Current

Assets Other Non-Current Assets Other Current Liabilities Other Non-Current

Liabilities Total

January 31, 2025

Other Current Assets Other Non-Current Assets Other Current Liabilities Other Non-Current Liabilities Total Fair Value

(in millions)

2 unchanged sentences

Foreign exchange contracts in a liability position ( 7 ) — ( 3 ) — ( 10 )

Interest rate contracts in an asset position — — — — —

Interest rate contracts in a liability position — — — — —

Net asset (liability) 129 — 6 — 135

7 unchanged sentences

February 2, 2024

Other Current

Assets Other Non-Current Assets Other Current Liabilities Other Non-Current

Liabilities Total

Other Current Assets Other Non-Current Assets Other Current Liabilities Other Non-Current Liabilities Total Fair Value

(in millions)

2 unchanged sentences

Foreign exchange contracts in a liability position ( 5 ) — ( 15 ) — ( 20 )

Interest rate contracts in an asset position — — — — —

Interest rate contracts in a liability position — — — ( 6 ) ( 6 )

Net asset (liability) 39 — 4 — 43

9 unchanged sentences

The following tables present the gross amounts of the Company’s derivative instruments, amounts offset due to master netting agreements with the Company’s counterparties, and the net amounts recognized in the Consolidated Statements of Financial Position as of the dates indicated:

February 2, 2024

January 31, 2025

Gross Amounts of Recognized Assets/(Liabilities) Gross Amounts Offset in the Statement of Financial Position Net Amounts of Assets/(Liabilities) Presented in the Statement of Financial Position Gross Amounts not Offset in the Statement of Financial Position Net Amount of Assets/ (Liabilities) Recognized in the Statement of Financial Position

17 unchanged sentences

The Infrastructure Solutions Group and Client Solutions Group reporting units are consistent with the reportable segments identified in Note 18 of the Notes to the Consolidated Financial Statements.

Other businesses consists of VMware Resale, Secureworks, and Virtustream, which each represent separate reporting units.

Corporate and other consists of results of Secureworks, VMware Resale, and Virtustream, each of which represents a separate reporting unit not classified as a reportable segment, either individually or collectively.

The following table presents goodwill allocated to the Company’s reportable segments and changes in the carrying amount of goodwill as of the dates indicated:

Infrastructure Solutions Group Client Solutions Group Other Businesses Total

Infrastructure Solutions Group Client Solutions Group Corporate and other Total

(in millions)

3 unchanged sentences

Balances as of February 2, 2024 15,041 4,232 427 19,700

Impact of foreign currency translation and other ( 153 ) — — ( 153 )

Reclassification to assets held for sale (b) — — ( 427 ) ( 427 )

Balances as of January 31, 2025 $ 14,888 $ 4,232 $ — $ 19,120

____________________

1 unchanged sentence

during the fiscal year ended February 2, 2024.

(b) During the fiscal year ended January 31, 2025, Secureworks goodwill was reclassified to current assets held for sale on the Consolidated Statements of Financial Position.

See Note 1 of the Notes to the Consolidated Financial Statements for additional information about the sale of Secureworks.

Intangible Assets

The following table presents the Company’s intangible assets as of the dates indicated:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

Gross Accumulated

8 unchanged sentences

Total intangible assets $ 30,072 $ ( 25,084 ) $ 4,988 $ 30,434 $ ( 24,733 ) $ 5,701

Amortization expense related to definite-lived intangible assets was $ 0.8 billion, $ 1.0 billion, and $ 1.6 billion for the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022, respectively.

There were no material impairment charges related to intangible assets during the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022.

Amortization expense related to definite-lived intangible assets was $ 0.7 billion, $ 0.8 billion, and $ 1.0 billion for the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023, respectively.

There were no material impairment charges related to intangible assets during the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023.

DELL TECHNOLOGIES INC.

1 unchanged sentence

The following table presents the estimated future annual pre-tax amortization expense of definite-lived intangible assets as of the date indicated:

February 2, 2024

January 31, 2025

(in millions)

12 unchanged sentences

The qualitative assessment included consideration of the relevant events and circumstances affecting the reporting unit, including macroeconomic, industry and market conditions, overall financial performance, and trends in the public company market valuation, where applicable.

Additionally, Secureworks’ entry into an agreement, pursuant to which Secureworks was acquired in an all-cash transaction for approximately $ 0.9 billion, as discussed in Note 1 of the Notes to the Consolidated Financial Statements, provided a fair value indication that the Secureworks reporting unit exceeded its carrying value.

Management exercised significant judgment related to the above assessments, including the identification of goodwill reporting units, assignment of assets and liabilities to goodwill reporting units, assignment of goodwill to reporting units, and determination of the fair value of each goodwill reporting unit.

3 unchanged sentences

The fair value of the indefinite-lived trade names is generally estimated using discounted cash flow methodologies.

These methodologies require significant judgment, including estimation of future revenue, the estimation of the long-term revenue growth rate of the Company’s business and the determination of the Company’s weighted average cost of capital and royalty rates.

These methodologies require significant judgment, including the estimation of future revenue, the estimation of the long-term revenue growth rate of the Company’s business and the determination of the Company’s weighted average cost of capital and royalty rates.

Changes in these estimates and assumptions could materially affect the fair value of the indefinite-lived intangible assets, potentially resulting in a non-cash impairment charge.

Based on the results of the annual impairment test performed during the fiscal year ended February 2, 2024, the fair values of each of the reporting units and indefinite-lived intangibles exceeded their carrying values.

No goodwill or indefinite-lived assets impairment test was performed during the fiscal year ended February 2, 2024 other than the Company’s annual impairment review.

Based on the results of the annual impairment test performed during the fiscal year ended January 31, 2025, the fair values of each of the reporting units and indefinite-lived intangibles exceeded their carrying values.

No goodwill or indefinite-lived assets impairment test was performed during the fiscal year ended January 31, 2025 other than the Company’s annual impairment review and the assessment of Secureworks.

DELL TECHNOLOGIES INC.

6 unchanged sentences

Fiscal Year Ended

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

(in millions)

8 unchanged sentences

____________________

(a) For the fiscal year ended February 3, 2023, Other represents the reclassification of deferred revenue to accrued and other liabilities.

(a) For the fiscal year ended January 31, 2025, Other represents the reclassification of Secureworks deferred revenue to liabilities held for sale.

See Note 1 of the Notes to the Consolidated Financial Statements for more information about the sale of Secureworks.

Remaining Performance Obligations — Remaining performance obligations represent the aggregate amount of the transaction price allocated to performance obligations not delivered, or partially undelivered, as of the end of the reporting period.

Remaining performance obligations include deferred revenue plus unbilled amounts not yet recorded in deferred revenue.

The value of the transaction price allocated to remaining performance obligations as of February 2, 2024 was approximately $ 40 billion.

The Company expects to recognize approximately 58 % of remaining performance obligations as revenue in the next twelve months , and the remainder thereafter.

The value of the transaction price allocated to remaining performance obligations as of January 31, 2025 was approximately $ 38 billion.

The Company expects to recognize approximately 61 % of remaining performance obligations as revenue in the next twelve months , 20 % in the following twelve months , and the remainder thereafter.

The aggregate amount of the transaction price allocated to remaining performance obligations does not include amounts owed under cancelable contracts where there is no substantive termination penalty.

6 unchanged sentences

The Company has contractual obligations to purchase goods or services, which specify significant terms (including fixed or minimum quantities to be purchased), fixed, minimum, or variable price provisions, and the approximate timing of the transaction.

As of February 2, 2024, such purchase obligations were $ 4.4 billion for Fiscal 2025;

$ 0.3 billion for Fiscal 2026;

and $ 0.3 billion for Fiscal 2027 and thereafter.

Purchase obligations are primarily related to commitments with suppliers and software maintenance and support services.

As of January 31, 2025, such purchase obligations were $ 5.0 billion for Fiscal 2026, $ 0.6 billion for Fiscal 2027, and $ 0.9 billion for Fiscal 2028 and thereafter.

Legal Matters

9 unchanged sentences

Dell and certain other directors serving on the Company’s board of directors at the time of the Class V transaction (collectively, the “director defendants”), certain stockholders of the Company, consisting of Mr.

Dell and Silver Lake Group LLC and certain of its affiliated funds (collectively, the “stockholder defendants”), and Goldman Sachs & Co.

LLC (“Goldman Sachs”), which served as financial advisor to the Company in connection with the transaction.

Dell and Silver Lake Group, L.L.C.

and certain of its affiliated funds (collectively, the “stockholder defendants”), and Goldman Sachs & Co.

LLC, which served as financial advisor to the Company in connection with the transaction.

The plaintiffs generally alleged that the director defendants and the stockholder defendants breached their fiduciary duties under Delaware law to the former holders of the Class V Common Stock in connection with the Class V transaction by offering a transaction value that was allegedly billions of dollars below fair value.

As previously reported, during the fourth quarter of the fiscal year ended February 3, 2023, the plaintiffs and the defendants entered into an agreement to settle the lawsuit.

Under the terms of the settlement, the plaintiffs agreed to the dismissal of all claims upon payment of a total of $ 1.0 billion (the “settlement amount”), which includes all costs, expenses and fees of the plaintiff class relating to the action and its resolution.

The settlement terms required that the settlement amount be paid by the Company and/or the Company’s insurers pursuant to indemnification obligations of the Company to the defendants.

The Company is subject to indemnification obligations, upon the satisfaction of specified conditions, to the director and stockholder defendants and their affiliates pursuant to provisions of the Delaware General Corporation Law, the Company’s certificate of incorporation and bylaws, and agreements with the defendants.

A special committee of the Board of Directors consisting of directors who were not defendants in the action, advised by independent counsel, informed the Board of Directors of its determination that the defendants were entitled to indemnification under the foregoing obligations.

During the fiscal year ended February 3, 2023, the Company established a $ 1.0 billion liability on the Consolidated Statements of Financial Position and recognized $ 0.9 billion expense, net of $ 106 million in insurance proceeds, within interest and other, net within the Consolidated Statements of Income related to the settlement agreement.

Under the terms of the settlement, the plaintiffs agreed to the dismissal of all claims upon payment of a total of $ 1.0 billion (the “settlement amount”), which included all costs, expenses and fees of the plaintiff class relating to the action and its resolution.

On May 16, 2023, during the fiscal year ended February 2, 2024, the Company paid the settlement amount following approval of the settlement by the Delaware Court of Chancery.

This matter is no longer material to the Company.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

On May 16, 2023, during the fiscal year ended February 2, 2024, the Company paid the settlement amount following approval of the settlement by the Delaware Court of Chancery.

The payment is reflected within cash flows from operating activities within the Consolidated Statements of Cash Flows.

R2 Semiconductor Patent Litigation — In November 2022, R2 Semiconductor, Inc.

(“R2”) filed a lawsuit in the Dusseldorf Regional Court in Germany against Intel Deutschland GmbH, Dell GmbH, and certain other customers of Intel Corporation.

R2 asserted that one European patent is infringed by certain Intel processors and those of the Company’s products that incorporate those processors (the “Accused Products”).

R2 asserted that one European patent is infringed by certain Intel processors and those of the Company’s products that incorporate those processors.

R2 sought an injunction prohibiting the sale of the allegedly infringing products and damages for the alleged infringement.

The Dusseldorf Regional Court (the “Court”) conducted a trial on December 7, 2023, and, on February 7, 2024, issued a decision in favor of R2.

The Court’s judgment imposes an injunction prohibiting (among other acts) the sale and use of the Accused Products in Germany by Dell GmbH, and requiring Dell GmbH to issue a communication to certain customers recalling the covered products sold since March 5, 2020.

These orders will not take effect until after notice of R2’s payment of the sureties required for enforcement and will remain in place unless stayed or overturned on appeal or until the parties reach an agreement.

On February 8, 2024, the Company filed an appeal which is in process with the appellate court.

The Court has not yet assessed damages arising out of R2’s claim.

Intel Corporation has agreed to defend and indemnify the Company and its affiliates against certain losses incurred by the Company in connection with the alleged infringement.

Given the status of this lawsuit, the nature of the case, and the Company’s agreements with Intel Corporation, the Company is unable to make a reasonable estimate of the potential loss or range of losses that might arise from the lawsuit.

Other Litigation — Dell does not currently anticipate that any of the other various legal proceedings it is involved in will have a material adverse effect on its business, financial condition, results of operations, or cash flows.

The court conducted a trial on December 7, 2023 and, on February 7, 2024, issued a decision in favor of R2 and imposed an injunction prohibiting the sale and use of such products in Germany by Dell GmbH, and requiring Dell GmbH to issue a communication to certain customers recalling the covered products sold since March 5, 2020.

On February 8, 2024, the Company filed an appeal.

In April and May 2024, R2 filed lawsuits in Paris, France and Milan, Italy, against affiliates of Intel Corporation (“Intel”) and of the Company, raising similar allegations.

Intel agreed to defend the foregoing actions and indemnify the Company and its affiliates against certain losses incurred by the Company in connection with R2’s claims.

On August 30, 2024, Intel and R2 publicly announced an agreement to dismiss all litigation between the two companies that would include dismissal of all litigation against all subsidiaries of Dell Technologies named in the foregoing actions.

Pursuant to that agreement, the Italian lawsuit was dismissed on September 2, 2024, the German lawsuit was dismissed on September 4, 2024, and the French lawsuit was dismissed on September 6, 2024.

Other Litigation — Dell does not currently anticipate that any of the other legal proceedings it is involved in will have a material adverse effect on its business, financial condition, results of operations, or cash flows.

In accordance with the relevant accounting guidance, the Company provides disclosures of matters where it is at least reasonably possible that the Company could experience a material loss exceeding the amounts already accrued for these or other proceedings or matters.

In addition, the Company also discloses matters based on its consideration of other matters and qualitative factors, including the experience of other companies in the industry, and investor, customer, and employee relations considerations.

As of February 2, 2024, the Company does not believe there is a reasonable possibility that a material loss exceeding the amounts already accrued for these or other proceedings or matters has been incurred.

As of January 31, 2025, the Company does not believe there is a reasonable possibility that a material loss exceeding the amounts already accrued for these or other proceedings or matters has been incurred.

However, since the ultimate resolution of any such proceedings and matters is inherently unpredictable, the Company’s business, financial condition, results of operations, or cash flows could be materially affected in any particular period by unfavorable outcomes in one or more of these proceedings or matters.

4 unchanged sentences

Historically, payments related to these indemnification obligations have not been material to the Company.

Under the Separation and Distribution Agreement entered into with VMware, Inc., (currently known as VMware LLC after its conversion into a Delaware limited liability company), upon the completion of the VMware Spin-off on November 1, 2021, Dell Technologies agreed to indemnify VMware, Inc., each of its subsidiaries and each of their respective directors, officers, employees, as well as any successors and assigns of the foregoing, from and against all liabilities relating to, arising out of or resulting from, among other matters, the liabilities allocated to Dell Technologies as part of the separation of Dell Technologies and VMware, Inc.

(individually and together with its subsidiaries, “VMware”) and their respective businesses (the “Separation”).

Under the Separation and Distribution Agreement entered into with VMware, Inc.

upon completion of the spin-off of VMware, Inc.

on November 1, 2021 (the “VMware Spin-off”), Dell Technologies agreed to indemnify VMware, Inc., each of its subsidiaries and each of their respective directors, officers, employees, as well as any successors and assigns of the foregoing, from and against all liabilities relating to, arising out of or resulting from, among other matters, the liabilities allocated to Dell Technologies as part of the separation of Dell Technologies and VMware, Inc.

(currently operating under the name VMware LLC, and individually and together with its subsidiaries, “VMware”) and their respective businesses (the “Separation”).

VMware similarly agreed to indemnify Dell Technologies Inc., each of its subsidiaries and each of their respective directors, officers, and employees from and against all liabilities relating to, arising out of or resulting from, among other matters, the liabilities allocated to VMware as part of the Separation.

The amounts that VMware and Dell Technologies may be obligated to pay each other could vary depending on the outcome of certain unresolved tax matters, which may not be resolved for several years.

Net income tax indemnification receivables from VMware were immaterial as of January 31, 2025 and February 2, 2024.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

For information on the cross-indemnifications related to the tax matters agreement between the Company and VMware effective upon the Separation on November 1, 2021, see Note 20 of the Notes to the Consolidated Financial Statements.

Certain Concentrations

4 unchanged sentences

The Company markets and sells its products and services to large corporate clients, governmental agencies, and health care and education accounts, as well as to small and medium-sized businesses and individuals.

No single customer accounted for more than 10% of the Company’s consolidated net revenue during the fiscal year ended February 2, 2024, February 3, 2023, and January 28, 2022.

No single customer accounted for more than 10% of the Company’s consolidated net revenue during the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023.

The Company utilizes a limited number of contract manufacturers that assemble a portion of its products.

4 unchanged sentences

The agreements with the majority of the contract manufacturers permit the Company to offset its payables against the receivables, thus mitigating the credit risk wholly or in part.

Such receivables were $ 3.4 billion and $ 3.3 billion as of February 2, 2024 and February 3, 2023, respectively, and primarily consisted of receivables from the Company’s four largest contract manufacturers.

The Company offset its corresponding payables against $ 2.7 billion and $ 2.5 billion of such receivables as of February 2, 2024 and February 3, 2023, respectively.

Such receivables were $ 5.4 billion and $ 3.4 billion as of January 31, 2025 and February 2, 2024, respectively, and primarily consisted of receivables from the Company’s three largest contract manufacturers.

The Company offset its corresponding payables against $ 4.7 billion and $ 2.7 billion of such receivables as of January 31, 2025 and February 2, 2024, respectively.

The portion of receivables not offset is included in other current assets in the Consolidated Statements of Financial Position.

2 unchanged sentences

NOTE 12 — INCOME AND OTHER TAXES

The following table presents components of the income tax expense (benefit) for continuing operations recognized for the periods indicated:

The following table presents components of the income tax expense (benefit) recognized for the periods indicated:

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

8 unchanged sentences

Income tax expense $ 472 $ 715 $ 803

The following table presents components of income (loss) before income taxes for continuing operations for the periods indicated:

The following table presents components of income (loss) before income taxes for the periods indicated:

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

2 unchanged sentences

Income before income taxes $ 5,048 $ 4,087 $ 3,225

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table presents a reconciliation of the Company’s effective tax rate to the statutory U.S.

federal tax rate for continuing operations for the periods indicated:

federal tax rate for the periods indicated:

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

federal statutory rate 21.0 % 21.0 % 21.0 %

5 unchanged sentences

R&D tax credits ( 1.7 ) ( 4.3 ) ( 2.6 )

Legal entity restructuring — — ( 4.1 )

Lapse of U.S.

statutes of limitations ( 8.5 ) — —

Class V transaction litigation settlement — — 5.8

1 unchanged sentence

Total 9.4 % 17.5 % 24.9 %

Changes related to the Company’s effective tax rates for the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022 were primarily driven by items discrete to those years.

Additionally, the Company’s effective tax rate for the fiscal year ended February 2, 2024 as compared to the fiscal year ended February 3, 2023 reflected the tax impact of foreign operations and benefits from U.S.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Changes related to the Company’s effective tax rates for the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023 were primarily attributable to discrete tax items and a change in the Company’s jurisdictional mix of income related to the tax impact of foreign operations and benefits from U.S.

research and development tax credits.

The Company’s effective tax rate for the fiscal year ended February 3, 2023 includes the impact of a $ 0.9 billion expense recognized in connection with the agreement to settle the Class V transaction litigation described in Note 12 of the Notes to the Consolidated Financial Statements.

The Company’s effective tax rate for the fiscal year ended January 28, 2022 includes tax expense of $ 1.0 billion on a pre-tax gain of $ 4.0 billion related to the divestiture of Boomi during the period, as well as tax benefits of $ 367 million on $ 1.6 billion of debt extinguishment fees and $ 244 million related to the restructuring of certain legal entities.

The Company’s effective tax rate for the fiscal year ended January 31, 2025 included discrete tax benefits of $ 0.4 billion related to the expiration of certain U.S.

statutes of limitations and $ 0.2 billion related to stock-based compensation.

The Company’s effective tax rate for the fiscal year ended February 3, 2023 included the impact of a $ 0.9 billion expense recognized in connection with the agreement to settle the Class V transaction litigation described in Note 11 of the Notes to the Consolidated Financial Statements.

The differences between the effective income tax rates and the U.S.

federal statutory rate of 21% principally result from the geographical distribution of income, differences between the book and tax treatment of certain items, and discrete tax items.

In certain jurisdictions, the Company’s tax rate is significantly less than the applicable statutory rate as a result of tax holidays.

In certain jurisdictions, the Company’s tax rate is significantly lower than the applicable statutory rate as a result of tax holidays.

The majority of the Company’s foreign income subject to these tax holidays and lower tax rates is attributable to Singapore and China.

A significant portion of these income tax benefits relates to a tax holiday that will be effective until January 31, 2029.

Most of the Company’s other tax holidays will expire in whole or in part during fiscal years 2030 and 2031.

Many of these tax holidays and reduced tax rates may be extended when certain conditions are met or may be terminated early if certain conditions are not met or as a result of changes in tax legislation.

As of February 2, 2024, the Company was not aware of any matters of non-compliance related to these tax holidays or enacted tax legislative changes affecting these tax holidays.

For the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022, the income tax benefits attributable to the tax status of the affected subsidiaries were estimated to be approximately $ 244 million ($ 0.33 per share), $ 123 million ($ 0.16 per share), and $ 466 million ($ 0.59 per share), respectively.

These income tax benefits are included in tax impact of foreign operations in the table above.

As of February 2, 2024, the Company has undistributed earnings of certain foreign subsidiaries of approximately $ 36.4 billion that remain indefinitely reinvested, and as such has not recognized a deferred tax liability.

Starting in the fiscal year ended January 31, 2025, the benefits of these tax holidays were limited by the impact of the Organisation for Economic Co-operation and Development’s Pillar Two global minimum tax.

For the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023, the income tax benefits attributable to the tax status of the affected subsidiaries were immaterial to the Company’s provision for income taxes and earnings per share.

As of January 31, 2025, the Company has undistributed earnings of certain foreign subsidiaries of approximately $ 36.9 billion that remain indefinitely reinvested, and as such has not recognized a deferred tax liability.

Determination of the amount of unrecognized deferred income tax liability related to these undistributed earnings is not practicable.

The Company believes that a significant portion of the Company’s undistributed earnings as of February 2, 2024 will not be subject to further U.S.

The Company believes that a significant portion of the Company’s undistributed earnings as of January 31, 2025 will not be subject to further U.S.

federal taxation.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table presents the components of the Company’s net deferred tax assets (liabilities) as of the dates indicated:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

(in millions)

5 unchanged sentences

Capitalized research and development 291 302

Other (a) 320 417

Deferred tax assets (b) 4,151 4,550

Other 256 320

Deferred tax assets (a) 4,165 4,151

Valuation allowance ( 1,368 ) ( 1,232 )

5 unchanged sentences

Other ( 393 ) ( 375 )

Deferred tax liabilities (b) ( 1,487 ) ( 1,655 )

Deferred tax liabilities (a) ( 1,191 ) ( 1,487 )

Net deferred tax assets $ 1,606 $ 1,432

____________________

(a) As of February 2, 2024, the Company elected to present provisions for product returns and doubtful accounts within Other.

Prior period balances have been recast to conform to this presentation.

(b) Deferred tax assets and deferred tax liabilities are included in other non-current assets and other non-current liabilities, respectively, in the Consolidated Statements of Financial Position.

(a) Deferred tax assets and deferred tax liabilities are included in other non-current assets and other non-current liabilities in the Consolidated Statements of Financial Position.

DELL TECHNOLOGIES INC.

1 unchanged sentence

The following tables present the net operating loss carryforwards, tax credit carryforwards, and other deferred tax assets with related valuation allowances recognized as of the dates indicated:

February 2, 2024

January 31, 2025

Deferred Tax Assets Valuation Allowance Net Deferred Tax Assets First Year Expiring

11 unchanged sentences

Total $ 4,151 $ ( 1,232 ) $ 2,919

The Company’s credit carryforwards as of February 2, 2024 and February 3, 2023 relate primarily to U.S.

tax credits and include state and federal tax credits associated with research and development, as well as foreign tax credits associated with the U.S.

The Company’s credit carryforwards as of January 31, 2025 and February 2, 2024 relate primarily to U.S.

tax credits and include state tax credits associated with research and development, as well as foreign tax credits associated with the U.S.

Tax Cuts and Jobs Act.

1 unchanged sentence

tax credits and has recorded a valuation allowance against the credits it does not expect to utilize.

The decrease in credit carryforwards and corresponding valuation allowance for the fiscal year ended February 2, 2024 was primarily attributable to changes in the determination of foreign tax credits associated with the U.S.

Tax Cuts and Jobs Act.

These credit carryforwards were not previously expected to be utilized and had a full valuation allowance.

Accordingly, such changes had no impact on the Company’s effective tax rate.

The Company’s loss carryforwards as of February 2, 2024 and February 3, 2023 include net operating loss carryforwards from federal, state, and foreign jurisdictions.

The valuation allowances for other deferred tax assets as of February 2, 2024 and February 3, 2023 primarily relate to foreign jurisdictions, the changes in which are included in tax impact of foreign operations in the Company’s effective tax reconciliation.

The Company’s loss carryforwards as of January 31, 2025 and February 2, 2024 include net operating loss carryforwards from federal, state, and foreign jurisdictions.

The valuation allowances for other deferred tax assets as of January 31, 2025 and February 2, 2024 primarily relate to foreign jurisdictions, the changes in which are included in the tax impact of foreign operations in the Company’s effective tax reconciliation.

The Company has determined that it will be able to realize the remainder of its deferred tax assets.

1 unchanged sentence

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

7 unchanged sentences

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

3 unchanged sentences

Reductions for tax positions of prior years ( 129 ) ( 177 ) ( 46 )

Lapse of statute of limitations ( 35 ) ( 41 ) ( 78 )

Lapse of statutes of limitations ( 388 ) ( 35 ) ( 41 )

Audit settlements ( 32 ) ( 65 ) ( 9 )

Ending Balance $ 1,976 $ 2,367 $ 1,812

The table above does not include accrued interest and penalties of $ 394 million as of both February 2, 2024 and February 3, 2023, and $ 383 million as of January 28, 2022.

Additionally, the table does not include certain tax benefits associated with interest and state tax deductions and other indirect jurisdictional effects of uncertain tax positions, which were $ 1,438 million, $ 910 million, and $ 817 million as of February 2, 2024, February 3, 2023, and January 28, 2022, respectively.

After taking these items into account, the Company’s net unrecognized tax benefits were $ 1.3 billion as of February 2, 2024 and February 3, 2023, and $ 1.2 billion as of January 28, 2022, and are included in other non-current liabilities i n the Consolidated Statements of Financial Position .

The unrecognized tax benefits in the table above include $ 1.2 billion, $ 1.1 billion, and $ 0.9 billion as of February 2, 2024, February 3, 2023, and January 28, 2022, respectively, that, if recognized, would have impacted income tax expense.

The table above does not include accrued interest and penalties of $ 0.2 billion as of January 31, 2025 and $ 0.4 billion as of both February 2, 2024 and February 3, 2023.

The table also does not include certain tax benefits associated with interest and state tax deductions and other indirect jurisdictional effects of uncertain tax positions, which were $ 1.3 billion, $ 1.4 billion, and $ 0.9 billion as of January 31, 2025, February 2, 2024, and February 3, 2023, respectively.

After taking these items into account, the Company’s net unrecognized tax benefits were $ 0.9 billion as of January 31, 2025 and $ 1.3 billion as of February 2, 2024 and February 3, 2023, and are included in other non-current liabilities i n the Consolidated Statements of Financial Position .

The unrecognized tax benefits in the table above include $ 0.9 billion, $ 1.2 billion, and $ 1.1 billion as of January 31, 2025, February 2, 2024, and February 3, 2023, respectively, that, if recognized, would have impacted income tax expense.

Interest and penalties related to income tax liabilities are included in income tax expense.

The impact of interest and penalties on the Company’s tax provision was immaterial for the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022.

In June 2023, the Company received Revenue Agent’s Reports for the examination by the Internal Revenue Service (“IRS”) of fiscal years 2015 through 2017 and fiscal years 2018 through 2019.

The Company agreed with the IRS assessments relating to fiscal years 2015 through 2017 and settled those positions in August 2023.

The impact to the financial statements for that settlement was not material.

For fiscal years 2018 through 2019, the IRS proposed adjustments primarily relating to certain transactions the Company completed as part of its business integration efforts, with which the Company disagrees and which it will contest through the IRS administrative appeals procedures.

The impact of interest and penalties on the Company’s tax provision was immaterial for the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023.

In June 2023, the Company received a Revenue Agent’s Report for the federal income tax examination by the Internal Revenue Service (“IRS”) of fiscal years 2018 through 2019.

The IRS proposed adjustments primarily relating to certain transactions the Company completed as part of its business integration efforts.

In August 2023, the Company submitted a written protest to the IRS relating to certain assessments.

The Company received a rebuttal from the IRS to its written protest in April 2024.

The Company disagrees with the IRS’s proposed adjustments and will contest them through the IRS administrative appeals procedures.

The Company anticipates that the appeals process for the resolution of these matters will extend beyond the next twelve months.

In September 2023, the IRS commenced a federal income tax examination of fiscal years 2020 through 2022.

The IRS is also currently conducting a federal income tax examination of fiscal years 2020 through 2022.

The Company is also currently under income tax audits in various U.S.

2 unchanged sentences

With respect to major U.S.

state and foreign taxing jurisdictions, the Company is generally not subject to tax examinations for years prior to the fiscal year ended January 29, 2010.

state and foreign taxing jurisdictions, the Company is generally not subject to tax examinations for years prior to the fiscal year ended February 2, 2018.

The Company believes that it has provided adequate reserves related to all matters contained in tax periods open to examination, including the IRS audits described above.

1 unchanged sentence

Judgment is required in evaluating the Company’s uncertain tax positions and determining the Company’s provision for income taxes.

Although the timing of resolution or closure of uncertain tax positions is not certain, the Company believes it is reasonably possible that certain tax matters in various jurisdictions could be concluded within the next twelve months.

The resolution of these matters could reduce the Company’s unrecognized tax benefits by up to $ 0.4 billion including interest and penalties.

Such a reduction would have a material impact on the Company’s effective tax rate.

The Company does not anticipate a significant change to the total amount of unrecognized tax benefits within the next twelve months.

DELL TECHNOLOGIES INC.

16 unchanged sentences

Amounts reclassified from accumulated other comprehensive income (loss) — ( 705 ) 1 ( 704 )

Spin-off of VMware 9 ( 1 ) — 8

Total change for the period ( 222 ) ( 351 ) 2 ( 571 )

Balances as of January 28, 2022 $ ( 526 ) $ 129 $ ( 34 ) $ ( 431 )

Change in comprehensive loss attributable to non-controlling interests ( 1 ) — — ( 1 )

Balances as of February 3, 2023 $ ( 747 ) $ ( 222 ) $ ( 32 ) $ ( 1,001 )

Other comprehensive income (loss) before reclassifications ( 8 ) 85 15 92

1 unchanged sentence

Total change for the period ( 8 ) 192 17 201

Change in comprehensive loss attributable to non-controlling interests ( 1 ) — — ( 1 )

Balances as of February 2, 2024 $ ( 755 ) $ ( 30 ) $ ( 15 ) $ ( 800 )

2 unchanged sentences

Total change for the period ( 268 ) 135 ( 6 ) ( 139 )

Balances as of February 2, 2024 $ ( 755 ) $ ( 30 ) $ ( 15 ) $ ( 800 )

Balances as of January 31, 2025 $ ( 1,023 ) $ 105 $ ( 21 ) $ ( 939 )

Amounts related to the Company’s cash flow hedges are reclassified to net income during the same period in which the items being hedged are recognized in earnings.

4 unchanged sentences

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

Cash Flow Hedges Pensions Total Cash Flow Hedges Pensions Total Cash Flow Hedges Pensions Total

4 unchanged sentences

Operating expenses — 6 6 — ( 2 ) ( 2 ) — ( 1 ) ( 1 )

Income from discontinued operations — — — — — — 3 — 3

Total reclassifications, net of tax $ 111 $ 6 $ 117 $ ( 107 ) $ ( 2 ) $ ( 109 ) $ 705 $ ( 1 ) $ 704

5 unchanged sentences

(in millions)

Common stock as of February 2, 2024

Common stock as of January 31, 2025

Class A 600 277 277

11 unchanged sentences

The Company is authorized to issue one million shares of preferred stock, par value $ 0.01 per share.

As of February 2, 2024 and February 3, 2023, no shares of preferred stock were issued or outstanding.

As of January 31, 2025 and February 2, 2024, no shares of preferred stock were issued or outstanding.

Dell Technologies Common Stock — The Class A Common Stock, the Class B Common Stock, the Class C Common Stock, and the Class D Common Stock are collectively referred to as Dell Technologies Common Stock.

6 unchanged sentences

Conversion Rights — Under the Company’s certificate of incorporation, at any time and from time to time, any holder of Class A Common Stock or Class B Common Stock has the right to convert all or any of the shares of Class A Common Stock or Class B Common Stock, as applicable, held by such holder into shares of Class C Common Stock on a one -to-one basis.

During the fiscal year ended January 31, 2025, the Company issued 100 million shares of Class C Common Stock to stockholders upon the conversion of 76 million shares of Class A Common Stock and 24 million shares of Class B Common Stock in accordance with the Company’s certificate of incorporation.

During the fiscal year ended February 2, 2024, the Company issued 34 million shares of Class C Common Stock to stockholders upon the conversion of 25 million shares of Class A Common Stock and 9 million shares of Class B Common Stock in accordance with the Company’s certificate of incorporation.

During the fiscal year ended February 3, 2023, there were no conversions of shares of Class A Common Stock or Class B Common Stock into shares of Class C Common Stock.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

During the fiscal year ended January 28, 2022, the Company issued an aggregate of 6 million shares of Class C Common Stock to stockholders upon their conversion of the same number of shares of Class A Common Stock into Class C Common Stock in accordance with the Company’s certificate of incorporation.

On February 24, 2022, the Company announced that the Board of Directors adopted a dividend policy providing for payment of quarterly cash dividends on the Dell Technologies Common Stock.

During the fiscal year ended February 3, 2023, there were no conversions of shares of Class A Common Stock or Class B Common Stock into shares of Class C Common Stock.

The Company paid the following dividends during the periods presented:

1 unchanged sentence

(in millions)

February 29, 2024 April 23, 2024 May 3, 2024 $ 0.445 $ 316

June 11, 2024 July 23, 2024 August 2, 2024 $ 0.445 $ 314

September 18, 2024 October 22, 2024 November 1, 2024 $ 0.445 $ 312

December 3, 2024 January 22, 2025 January 31, 2025 $ 0.445 $ 310

March 2, 2023 April 25, 2023 May 5, 2023 $ 0.37 $ 270

2 unchanged sentences

December 5, 2023 January 23, 2024 February 2, 2024 $ 0.37 $ 261

February 24, 2022 April 20, 2022 April 29, 2022 $ 0.33 $ 248

June 7, 2022 July 20, 2022 July 29, 2022 $ 0.33 $ 242

September 6, 2022 October 19, 2022 October 28, 2022 $ 0.33 $ 238

December 6, 2022 January 25, 2023 February 3, 2023 $ 0.33 $ 236

During the fiscal year ended February 2, 2024, the Company also paid an immaterial amount of dividend equivalents on eligible vested equity awards which are not included above.

On February 29, 2024, subsequent to the close of the fiscal year ended February 2, 2024, the Company announced that the Board of Directors approved a 20 % increase in the dividend to a rate of $ 0.445 per share per fiscal quarter beginning in the first quarter of the fiscal year ending January 31, 2025.

During the fiscal year ended January 31, 2025 and February 2, 2024, the Company also paid an immaterial amount of dividend equivalents on eligible vested equity awards which are not included above.

On February 27, 2025, subsequent to the close of the Company’s fiscal year ended January 31, 2025, the Company announced that the Board of Directors approved an 18 % increase in the dividend rate to $ 0.525 per share per fiscal quarter beginning in the first quarter of the fiscal year ending January 30, 2026.

Repurchases of Common Stock

Effective as of September 23, 2021, the Company’s Board of Directors approved a stock repurchase program under which the Company is authorized to repurchase up to $ 5 billion of shares of Class C Common Stock with no fixed expiration date.

Effective as of October 5, 2023, the Company’s Board of Directors approved the repurchase of an additional $ 5 billion of shares of the Company’s Class C Common Stock under the stock repurchase program.

Following the approval, the Company had approximately $ 5.7 billion in authorized amount remaining under the program.

On September 23, 2021, the Company’s Board of Directors approved the Company’s current stock repurchase program with no fixed expiration date under which the Company may repurchase up to $ 5 billion of shares of Class C Common Stock, exclusive of any fees, commissions, or other expenses related to such repurchases.

On October 5, 2023 and February 27, 2025, subsequent to the close of the fiscal year ended January 31, 2025, the Company’s Board of Directors authorized additional shares for repurchase under the program of $ 5 billion and $ 10 billion, respectively.

Following the February 27, 2025 approval, the Company had approximately $ 11.5 billion of authorized shares remaining under the program.

During the fiscal year ended January 31, 2025, the Company repurchased approximately 22 million shares of Class C Common Stock for a total purchase price of approximately $ 2.6 billion.

During the fiscal year ended February 2, 2024, the Company repurchased approximately 34 million shares of Class C Common Stock for a total purchase price of approximately $ 2.1 billion.

During the fiscal year ended February 3, 2023, the Company repurchased approximately 62 million shares of Class C Common Stock for a total purchase price of approximately $ 2.8 billion.

During the fiscal year ended January 28, 2022, the Company repurchased 12 million shares of Class C Common Stock for a total purchase price of approximately $ 659 million.

The above repurchases of Class C Common Stock exclude shares withheld from stock awards to settle employee tax withholding obligations related to the vesting of such awards.

The above repurchases of Class C Common Stock exclude U.S.

federal excise taxes and shares withheld from stock awards to settle employee tax withholding obligations related to the vesting of such awards.

DELL TECHNOLOGIES INC.

6 unchanged sentences

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

Earnings per share attributable to Dell Technologies Inc.

Continuing operations $ 4.46 $ 3.33 $ 6.49

Discontinued operations $ — $ — $ 0.81

January 31, 2025 February 2, 2024 February 3, 2023

Earnings per share attributable to Dell Technologies Inc.

Continuing operations $ 4.36 $ 3.24 $ 6.26

Discontinued operations $ — $ — $ 0.76

Dell Technologies Common Stock — Basic $ 6.51 $ 4.71 $ 3.33

Dell Technologies Common Stock — Diluted $ 6.38 $ 4.60 $ 3.24

The following table presents the computation of basic and diluted earnings per share for the periods indicated:

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

2 unchanged sentences

— basic and diluted $ 4,592 $ 3,388 $ 2,442

Discontinued operations

Income from discontinued operations, net of income taxes — basic $ — $ — $ 615

Incremental dilution from VMware, Inc.

Income from discontinued operations, net of income taxes, attributable to Dell Technologies Inc.

— diluted $ — $ — $ 608

Dell Technologies Common Stock weighted-average shares outstanding

6 unchanged sentences

NOTE 16 — STOCK-BASED COMPENSATION

Stock-Based Compensation Expense

The following table presents stock-based compensation expense recognized in the Consolidated Statements of Income for the periods indicated:

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

2 unchanged sentences

Operating expenses 633 729 779

Stock-based compensation expense from continuing operations before taxes 878 931 808

Stock-based compensation expense from discontinued operations before taxes (a) — — 814

Total stock-based compensation expense before taxes 785 878 931

1 unchanged sentence

Total stock-based compensation expense, net of income taxes $ 642 $ 721 $ 768

____________________

(a) Stock-based compensation expense from discontinued operations before taxes represents VMware stock-based compensation expense and is included in income from discontinued operations, net of taxes, on the Consolidated Statements of Income for periods prior to the VMware Spin-off.

Dell Technologies Inc.

8 unchanged sentences

The 2023 Plan authorizes the issuance of an aggregate of up to approximately 103.3 million shares of the Class C Common Stock, including (a) 50.0 million shares of Class C Common Stock that were authorized for offering and issuance under the 2023 Plan, (b) approximately 7.0 million shares of Class C Common Stock that remained available for issuance under the 2013 Plan as of the effective date of the 2023 Plan, and (c) up to approximately 46.3 million shares of Class C Common Stock subject to awards outstanding under the 2013 Plan as of the effective date of the 2023 Plan that subsequently expire or terminate prior to exercise or settlement.

As of February 2, 2024, there were approximately 58 million shares of Class C Common Stock available for future grants under the 2023 Plan.

As of January 31, 2025, there were approximately 54 million shares of Class C Common Stock available for future grants under the 2023 Plan.

Restricted Stock — The Company’s awards primarily consist of RSUs granted to employees.

During the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022, the Company granted long-term incentive awards in the form of service-based RSUs and performance-based RSUs (“PSUs”) in order to align critical talent retention programs with the interests of holders of the Class C Common Stock.

During the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023, the Company granted long-term incentive awards in the form of service-based RSUs and performance-based RSUs (“PSUs”) in order to align critical talent retention programs with the interests of holders of the Class C Common Stock.

Service-based RSUs have a fair value based on the closing price of the Class C Common Stock price as reported on the NYSE on the grant date or the trade day immediately preceding the grant date, if the grant date falls on a non-trading day.

1 unchanged sentence

Each service-based RSU represents the right to acquire one share of Class C Common Stock upon vesting.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The PSUs granted during the periods presented are reflected as target units for performance periods not yet complete.

2 unchanged sentences

The remaining PSUs are subject to internal financial measures and have fair values based on the closing price of the Class C Common Stock as reported on the NYSE on the accounting grant date.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Beginning with grants made during the fiscal year ended February 3, 2023, dividend equivalents accrue on outstanding RSUs and PSUs when a dividend is paid to the Company’s common stockholders.

2 unchanged sentences

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

Weighted-average grant date fair value (a) $ 43.91 $ 73.26 $ 134.01

January 31, 2025 February 2, 2024 February 3, 2023

Weighted-average grant date fair value $ 172.99 $ 43.91 $ 73.26

Term (in years) 3 3 3

3 unchanged sentences

Expected dividend yield — % — % — %

____________________

(a) Weighted-average grant date fair value for periods prior to the completion of the VMware Spin-off is calculated using pre-spin off stock prices and has not been adjusted to reflect the impact of the conversion ratio on the Class C Common Stock.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table presents RSU activity settled in Class C Common Stock for the periods indicated :

3 unchanged sentences

Granted 23 48.11

VMware Spin-off adjustment (b) 30 NA

Vested ( 27 ) 29.96

Forfeited ( 5 ) 39.26

Outstanding as of January 28, 2022 59 31.67

Outstanding as of February 3, 2023 50 39.44

Granted 23 39.62

5 unchanged sentences

Forfeited ( 4 ) 56.93

Outstanding as of February 2, 2024 (c) 39 $ 44.68 $ 3,399

Vested and expected to vest, February 2, 2024 37 $ 44.83 $ 3,206

Outstanding as of January 31, 2025 (b) 26 $ 60.51 $ 2,673

Vested and expected to vest, January 31, 2025 25 $ 59.82 $ 2,551

____________________

(a) The aggregate intrinsic value represents the total pre-tax intrinsic values based on the closing price of $ 86.32 of the Class C Common Stock on February 2, 2024 as reported on the NYSE that would have been received by the RSU holders if the RSUs had been issued as of February 2, 2024.

(b) In connection with the VMware Spin-off, and as authorized by the 2013 Plan, Dell Technologies made certain adjustments to the number of RSUs using a conversion ratio of approximately 1.97 to 1 to preserve the intrinsic value of the awards prior to the VMware Spin-off.

The total fair value of RSU awards that vested during the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022 was $ 973 million, $ 827 million, and $ 493 million, respectively, with a pre-tax intrinsic value of $ 1,230 million, $ 1,371 million, and $ 1,097 million, respectively.

As of February 2, 2024, there was $ 848 million of unrecognized stock-based compensation expense, net of estimated forfeitures, related to these awards expected to be recognized over a weighted-average period of approximately 1.7 years.

(a) The aggregate intrinsic value represents the total pre-tax intrinsic values based on the closing price of $ 103.60 of the Class C Common Stock on January 31, 2025 as reported on the NYSE that would have been received by the RSU holders if the RSUs had been issued as of January 31, 2025.

(b) As of January 31, 2025, the 26 million units outstanding included 21 million RSUs and 5 million PSUs.

The total fair value of RSU awards that vested during the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023 was $ 795 million, $ 973 million, and $ 827 million, respectively, with a pre-tax intrinsic value of $ 1,984 million, $ 1,230 million, and $ 1,371 million, respectively.

As of January 31, 2025, there was $ 772 million of unrecognized stock-based compensation expense, net of estimated forfeitures, related to these awards expected to be recognized over a weighted-average period of approximately 1.7 years.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Dell Technologies Shares Withheld for Taxes — Beginning in the fiscal year ended February 3, 2023, shares of Class C Common Stock are generally withheld from issuance to cover employee taxes for the vesting of restricted stock units.

During the fiscal year ended January 28, 2022, shares of Class C Common Stock were withheld from issuance to cover employee taxes for both the vesting of restricted stock units and the exercise of stock options only under certain situations.

For the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022, 9.0 million, 8.0 million, and 0.4 million shares, respectively, were withheld to cover $ 366 million, $ 388 million, and $ 40 million, respectively, of employees’ tax obligations.

For the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023, 5.0 million, 9.0 million, and 8.0 million shares, respectively, were withheld to cover $ 568 million, $ 366 million, and $ 388 million, respectively, of employees’ tax obligations.

The value of the withheld shares was classified as a reduction to common stock and capital in excess of par value.

Stock Option Activity — In addition to RSU activity, the Company also had stock option activity which was not material during the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022.

Stock Option Activity — In addition to RSU activity, the Company also had stock option activity which was not material during the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023.

Stock options are granted with option exercise prices equal to the fair market value of the Company’s Class C Common Stock and expire ten years after the grant date.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

In addition to the 2023 Plan described above, the Company’s consolidated subsidiary, Secureworks, maintains its own equity plan and issues equity grants settling in its Class A common stock.

The stock option and restricted stock unit activity under this plan was not material to the Company during the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022.

The stock option and restricted stock unit activity under this plan was not material to the Company during the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023.

DELL TECHNOLOGIES INC.

2 unchanged sentences

Defined Benefit Retirement Plans

The Company sponsors retirement plans for certain employees in the United States and internationally, some of which meet the criteria of a defined benefit retirement plan.

The Company sponsors retirement plans for certain employees, some of which meet the criteria of a defined benefit retirement plan.

Benefits under defined benefit retirement plans guarantee a particular payment to the employee in retirement.

1 unchanged sentence

The annual costs of the plans are determined using the projected unit credit actuarial cost method that includes actuarial assumptions and estimates which are subject to change.

Pension Plan — The Company sponsors a noncontributory defined benefit retirement plan in the United States (the “U.S.

pension plan”) which was assumed in connection with the EMC merger transaction.

Pension Plan — The Company sponsored a noncontributory defined benefit retirement plan in the United States (the “U.S.

pension plan”), which was assumed in connection with the EMC merger transaction that was completed in September 2016.

As of December 1999, the U.S.

pension plan was frozen, so employees no longer accrue retirement benefits for future services.

On August 20, 2024, the Company’s Board of Directors approved an amendment to terminate the U.S.

pension plan with an effective date of September 30, 2024.

The Company is transitioning the U.S.

pension plan to a qualified insurance company and expects settlement in 12 to 18 months from the termination effective date.

The Company does not expect the settlement of the U.S.

pension plan obligations to have a material impact on its Consolidated Financial Statements.

The measurement date for the U.S.

1 unchanged sentence

The Company did not make any material contributions to the U.S.

pension plan for the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022, and does not expect to make any significant contributions in Fiscal 2025.

pension plan for the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023.

Net periodic benefit costs related to the U.S.

pension plan were immaterial for the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022.

pension plan were immaterial for the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023.

The following table presents attributes of the U.S.

pension plan as of the dates indicated:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

(in millions)

4 unchanged sentences

(a) Plan assets are managed by outside investment managers.

The Company’s investment strategy with respect to plan assets is to achieve a long-term growth of capital, consistent with an appropriate level of risk.

Assets are recognized at fair value and are primarily classified within Level 2 of the fair value hierarchy.

1 unchanged sentence

pension plan is recognized in other non-current liabilities in the Consolidated Statements of Financial Position.

As of February 2, 2024, future benefit payments for the U.S.

As of January 31, 2025, future benefit payments for the U.S.

pension plan are expected to be paid as follows:

4 unchanged sentences

$ 38 million in Fiscal 2030;

and $ 179 million thereafter.

and $ 176 million from Fiscal 2031 through Fiscal 2035.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

International Pension Plans — The Company also sponsors retirement plans outside of the United States which qualify as defined benefit plans.

International Pension Plans — The Company also sponsors retirement plans outside of the United States that qualify as defined benefit plans.

The following table presents attributes of the international pension plans as of the dates indicated:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

(in millions)

5 unchanged sentences

The Company’s investment strategy with respect to plan assets is to achieve a long-term growth of capital, consistent with an appropriate level of risk.

Assets are recognized at fair value and are primarily classified within Level 1 of the fair value hierarchy.

Assets are recognized at fair value and are primarily classified within Level 2 of the fair value hierarchy for the fiscal year ended January 31, 2025 and were primarily classified within Level 1 of the fair value hierarchy for the fiscal year ended February 2, 2024.

(b) The underfunded position is recognized in other non-current liabilities in the Consolidated Statements of Financial Position.

3 unchanged sentences

Participation in the Dell 401(k) Plan is at the election of the employee.

As of February 2, 2024, the Company matched 100 % of each participant’s voluntary contributions (the “Dell 401(k) employer match”), subject to a maximum contribution of 6 % of the participant’s eligible compensation, up to an annual limit of $ 7,500 .

As of January 31, 2025, the Company matched 100 % of each participant’s voluntary contributions (the “Dell 401(k) employer match”), subject to a maximum contribution of 6 % of the participant’s eligible compensation, up to an annual limit of $ 7,500 .

Participants vest immediately in all contributions to the Dell 401(k) Plan.

The Company’s matching contributions as well as participants’ voluntary contributions are invested according to each participant’s elections in the investment options provided under the Dell 401(k) Plan.

The Company’s contributions during the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022 were $ 238 million, $ 263 million, and $ 249 million, respectively.

The Company’s contributions during the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023 were $ 218 million, $ 238 million, and $ 263 million, respectively.

DELL TECHNOLOGIES INC.

1 unchanged sentence

NOTE 18 — SEGMENT INFORMATION

The Company has two reportable segments that are based on the following business units:

The Company reports its financial results through two reportable segments which are based on the following business units:

Infrastructure Solutions Group (“ISG”) and Client Solutions Group (“CSG”).

ISG includes the Company’s storage, server, and networking offerings.

The Company’s comprehensive storage portfolio includes modern and traditional storage solutions, including all-flash arrays, scale-out file, object platforms, hyper-converged infrastructure, and software-defined storage.

The Company organizes its reportable segments based on the manner in which management evaluates the performance of the Company.

The Company’s Chief Executive Officer is the Chief Operating Decision Maker (“CODM”).

The CODM is regularly provided and reviews segment revenue and segment operating income to assess the performance of each segment and allocate resources to the segments in the annual planning process.

The Company’s measure of segment revenue and segment operating income for management reporting purposes excludes Corporate and other, amortization of intangible assets, stock-based compensation expense, and other corporate expenses, as applicable, which are not used in evaluating the results of, or in allocating resources to, the segments.

The Company does not allocate assets to the above reportable segments for internal reporting purposes.

Additionally, the accounting policies of the segments are the same as those described in Note 2 of the Notes to the Consolidated Financial Statements.

ISG includes the Company’s servers and networking offerings and storage offerings.

The Company’s server portfolio includes high-performance general-purpose and AI-optimized servers.

The Company’s networking portfolio includes wide area network infrastructure, data center and edge networking switches, and cables and optics.

ISG also offers software, peripherals, and services, including consulting and support and deployment.

CSG includes offerings designed for commercial and consumer customers.

The Company’s CSG portfolio includes branded PCs including notebooks, desktops, and workstations, branded peripherals, and third-party software and peripherals.

CSG includes the Company’s commercial offerings and consumer offerings.

The Company’s CSG portfolio includes branded PCs, including notebooks, desktops, and workstations and branded peripherals that include displays, docking stations, keyboards, mice, and webcam and audio devices, as well as third-party software and peripherals.

CSG also includes services offerings, such as configuration, support and deployment, and extended warranties.

The reportable segments disclosed herein are based on information reviewed by the Company’s management to evaluate the business segment results.

The Company’s measure of segment revenue and segment operating income for management reporting purposes excludes operating results of other businesses, unallocated corporate transactions, the impact of purchase accounting, amortization of intangible assets, transaction-related expenses, stock-based compensation expense, and other corporate expenses, as applicable.

The Company does not allocate assets to the above reportable segments for internal reporting purposes.

Following the completion of the VMware Spin-off and pursuant to the CFA, as described in Note 1 and Note 3 of the Notes to the Consolidated Financial Statements, Dell Technologies acted as a distributor of VMware’s standalone products and services and purchased such products and services for resale to end-user customers (“VMware Resale”).

The results of VMware Resale transactions are reflected in other businesses.

On November 22, 2023, VMware was acquired by Broadcom.

Following the acquisition, Broadcom announced changes to its go-to-market approach for VMware offerings which impacted the Company’s commercial relationship with VMware.

In response to such changes, on January 25, 2024, under a provision of the CFA permitting it to terminate the agreement upon a change in control of VMware, the Company delivered notice of termination of the CFA to Broadcom under which the agreement will terminate on March 25, 2024.

The Company continues to integrate select VMware products and services with Dell Technologies’ offerings and sell them to end-users.

Following its acquisition by Broadcom on November 22, 2023, VMware announced changes to its go-to-market approach for VMware offerings that impacted the Company’s commercial relationship with VMware.

On March 25, 2024, the Company terminated the Commercial Framework Agreement with VMware, which provided the framework pursuant to which the Company and VMware continued the commercial relationship following the VMware Spin-off described in Note 11 of the Notes to the Consolidated Financial Statements and under which Dell Technologies acted as a distributor of Broadcom’s VMware stand-alone products and services and purchased such products and services for resale to end-user customers (“VMware Resale”).

Dell Technologies no longer acts as a distributor of VMware’s standalone products and services, although the Company will continue to support customers that have purchased resale offerings sold in prior periods.

The results of VMware Resale transactions are reflected in Corporate and other.

The Company continues to integrate and embed certain VMware products and services with select Dell Technologies’ offerings to end-users.

The results of such offerings are reflected within CSG or ISG, depending upon the nature of the underlying offering sold.

3 unchanged sentences

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

3 unchanged sentences

Reportable segment net revenue 91,986 82,801 96,569

Other businesses (a) (b) 5,614 5,721 5,388

Unallocated transactions (c) 10 11 11

Impact of purchase accounting (d) — — ( 32 )

Corporate and other (a) 3,581 5,624 5,732

Total consolidated net revenue $ 95,567 $ 88,425 $ 102,301

2 unchanged sentences

Client Solutions Group 2,972 3,712 3,824

Reportable segment operating income 7,798 8,869 8,101

Other businesses (a) (b) ( 129 ) ( 240 ) ( 319 )

Unallocated transactions (c) 9 8 3

Impact of purchase accounting (d) ( 14 ) ( 44 ) ( 67 )

Amortization of intangibles ( 819 ) ( 970 ) ( 1,641 )

Transaction-related expenses (e) ( 12 ) ( 22 ) ( 273 )

Stock-based compensation expense (f) ( 878 ) ( 931 ) ( 808 )

Other corporate expenses (g) ( 744 ) ( 899 ) ( 337 )

Total consolidated operating income $ 5,211 $ 5,771 $ 4,659

Reportable segment operating income (b) 8,551 7,998 8,869

Corporate and other (a) ( 22 ) ( 120 ) ( 232 )

Amortization of intangibles (c) ( 667 ) ( 833 ) ( 1,014 )

Stock-based compensation expense (d) ( 785 ) ( 878 ) ( 931 )

Other corporate expenses (e) ( 840 ) ( 756 ) ( 921 )

Total consolidated operating income (f) $ 6,237 $ 5,411 $ 5,771

____________________

(a) Other businesses consists of (i) VMware Resale, (ii) Secureworks, and (iii) Virtustream, and do not meet the requirements for a reportable segment, either individually or collectively.

(b) The Company completed the sale of Boomi on October 1, 2021.

Prior to the divestiture, Boomi’s results were included within other businesses.

See Note 1 of the Notes to the Consolidated Financial Statements for further information about the divestiture of Boomi.

(c) Unallocated transactions includes other corporate items that are not allocated to Dell Technologies’ reportable segments.

(d) Impact of purchase accounting includes non-cash purchase accounting adjustments that are primarily related to the EMC merger transaction.

(e) Transaction-related expenses includes acquisition, integration, and divestiture related costs.

During Fiscal 2022 this category also includes costs incurred in connection with the VMware Spin-off described in Note 1 and Note 3 of the Notes to the Consolidated Financial Statements.

(f) Stock-based compensation expense consists of equity awards granted based on the estimated fair value of those awards at grant date.

(g) Other corporate expenses includes impairment charges, severance expense, incentive charges related to equity investments, facility action costs, payroll taxes associated with stock-based compensation, and other costs.

(a) Corporate and other consists of results of divested businesses or non-reportable segments whose offerings are no longer actively sold, including (i) VMware Resale, (ii) Secureworks, and (iii) Virtustream, and do not meet the requirements for a reportable segment, either individually or collectively.

Additionally, Corporate and other includes other items that are managed at the corporate level and are not allocated to reportable segments.

(b) Depreciation expense directly attributable to each reportable segment is included in the operating results of each segment.

However, the CODM does not evaluate depreciation expense by operating segment, and therefore such expense is not separately presented.

(c) Amortization of intangibles includes non-cash purchase accounting adjustments that are primarily related to the EMC merger transaction.

(d) Stock-based compensation expense consists of equity awards granted based on the estimated fair value of those awards at grant date.

(e) Other corporate expenses includes severance expenses, payroll taxes associated with stock-based compensation, incentive charges related to equity investments, facility action costs, transaction-related expenses, and impairment charges.

(f) Income and expenses within Interest and other, net, is not allocated to the reportable segments.

Therefore, the Company only reports reportable segment operating income.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table presents the significant expense categories by reportable segment for the periods indicated:

Fiscal Year Ended

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

Infrastructure Solutions Group:

Cost of net revenue $ 29,352 $ 20,943 $ 24,326

Selling, general, and administrative $ 6,593 $ 6,752 $ 7,126

Research and development $ 2,069 $ 1,904 $ 1,859

Client Solutions Group:

Cost of net revenue $ 41,195 $ 40,658 $ 49,264

Selling, general, and administrative $ 3,750 $ 4,080 $ 4,639

Research and development $ 476 $ 466 $ 486

The following table presents the disaggregation of net revenue by reportable segment and by major product categories within the segments for the periods indicated:

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

9 unchanged sentences

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

2 unchanged sentences

Total net revenue $ 95,567 $ 88,425 $ 102,301

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table presents property, plant, and equipment, net allocated between the United States and foreign countries as of the dates indicated:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

(in millions)

4 unchanged sentences

The allocation between domestic and foreign net revenue is based on the location of the customers.

Net revenue from any single foreign country did not constitute more than 10% of the Company’s consolidated net revenue for any of the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022.

As of February 2, 2024 and February 3, 2023, property, plant, and equipment, net primarily related to domestic ownership.

Within foreign countries, property, plant, and equipment, net of $ 0.8 billion was located in Ireland.

Net revenue from any single foreign country did not constitute more than 10% of the Company’s consolidated net revenue for any of the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023.

As of January 31, 2025 and February 2, 2024, property, plant, and equipment, net primarily related to domestic ownership.

Within foreign countries, property, plant, and equipment, net located in Ireland was $ 0.7 billion and $ 0.8 billion for the fiscal years ended January 31, 2025 and February 2, 2024, respectively.

DELL TECHNOLOGIES INC.

1 unchanged sentence

NOTE 19 — RELATED PARTY TRANSACTIONS

Prior to the acquisition of VMware by Broadcom, VMware was considered a related party of the Company as a result of Michael Dell’s ownership interests in both Dell Technologies and VMware as well as Mr.

Dell’s service as Chairman and Chief Executive Officer of Dell Technologies and as Chairman of the Board of VMware, Inc.

On November 22, 2023, upon the completion of Broadcom’s acquisition of VMware, Mr.

Dell’s ownership interest in VMware and his position as Chairman of the Board of VMware terminated.

The Company has determined that Broadcom’s acquisition terminated the Company’s related party relationship with VMware effective as of November 22, 2023 and that no related party relationship exists with Broadcom or VMware as of February 2, 2024.

The information provided below includes a summary of related party transactions with VMware for the periods presented within this report.

Such transactions were considered related party transactions only through November 21, 2023, the day immediately preceding Broadcom’s acquisition of VMware.

Prior to the acquisition on November 22, 2023 of VMware LLC (previously VMware, Inc.

and individually and together with its consolidated subsidiaries, “VMware”) by Broadcom Inc.

(“Broadcom”), VMware was considered a related party of the Company.

Upon Broadcom’s acquisition of VMware, Michael Dell’s ownership interest in VMware and his position as Chairman of the Board of VMware terminated, and the Company determined no related party relationship exists with Broadcom or VMware effective as of November 22, 2023.

The Company continues to engage in select transactions with VMware following the completion of Broadcom’s acquisition and the termination of the related party relationship.

1 unchanged sentence

Related Party Transactions with VMware

The information provided below includes a summary of related party transactions with VMware for the periods presented within this report.

Such transactions were considered related party transactions only through November 21, 2023, the day immediately preceding Broadcom’s acquisition of VMware.

• Dell Technologies integrated or bundled select VMware products and services with Dell Technologies’ products and sold them to end-users.

2 unchanged sentences

• DFS provided financing to certain VMware end-users, which resulted in the recognition of amounts due to related parties on the Consolidated Statements of Financial Position.

Associated financing fees were recorded to product net revenue on the Consolidated Statements of Income and are reflected within sales and leases of products to VMware in the table below.

Associated financing fees were recorded to product net revenue on the Consolidated Statements of Income and were reflected within sales and leases of products to VMware in the table below.

• Dell Technologies procured products and services from VMware for its internal use.

For the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022, costs incurred associated with products and services purchased from VMware for internal use were immaterial.

For the fiscal years ended February 2, 2024 and February 3, 2023, costs incurred associated with products and services purchased from VMware for internal use were immaterial.

• Dell Technologies sold and leased products and sold services to VMware.

For the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022, revenue recognized from sales of services to VMware was immaterial.

For the fiscal years ended February 2, 2024 and February 3, 2023, revenue recognized from sales of services to VMware was immaterial.

• Dell Technologies and VMware entered into joint marketing, sales, and branding arrangements, for which both parties incurred costs.

For the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022, consideration received from VMware for joint marketing, sales, and branding arrangements was immaterial.

For the fiscal years ended February 2, 2024 and February 3, 2023, consideration received from VMware for joint marketing, sales, and branding arrangements was immaterial.

• Dell Technologies and VMware entered into a transition services agreement in connection with the VMware Spin-off to provide various support services, including investment advisory services, certain support services from Dell Technologies personnel, and other transitional services.

Costs incurred associated with this agreement were immaterial for the fiscal years ended February 3, 2023 and January 28, 2022.

Costs incurred associated with this agreement were immaterial for the fiscal year ended February 3, 2023.

Activities under the agreement concluded during Fiscal 2023.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table presents information about the impact of Dell Technologies’ related party transactions with VMware on the Consolidated Statements of Income for the periods presented:

Fiscal Year Ended

Classification February 2, 2024 (a) February 3, 2023 January 28, 2022

Classification February 2, 2024 (a) February 3, 2023

(in millions)

4 unchanged sentences

(a) For the fiscal year ended February 2, 2024, amounts are reported only through November 21, 2023, the day immediately preceding the acquisition of VMware by Broadcom.

The following tables present amounts classified as related party balances on the Consolidated Statements of Financial Position as of the dates indicated:

Classification February 3, 2023

(in millions)

Deferred costs related to VMware products and services for resale (a) Other current assets $ 3,000

Deferred costs related to VMware products and services for resale (a) Other non-current assets $ 2,537

____________________

(a) Deferred costs are not reported as related party balances as of February 2, 2024 as the related party relationship with VMware terminated upon Broadcom’s acquisition of VMware.

February 2, 2024 (a) February 3, 2023

(in millions)

Due from related party, net, current (b) $ — $ 378

Due from related party, net, non-current (c) $ — $ 440

Due to related party, current (d) $ — $ 2,067

____________________

(a) Amounts due from related party, net were reclassified into accounts receivable, net, other current assets, and other non-current assets, and amounts due to related party, net were reclassified into accounts payable as of February 2, 2024 as, subsequent to Broadcom’s acquisition of VMware, the amounts were no longer considered due from or due to a related party.

(b) Amounts due from related party, net, current consisted of amounts due from VMware, inclusive of current net tax receivables from VMware under the Tax Agreements described below.

Amounts, excluding tax, were generally settled in cash within 60 days.

(c) Amounts due from related party, net, non-current consisted of the non-current portion of net receivables from VMware under the Tax Agreements.

(d) Amounts due to related party, current included amounts due to VMware, which were generally settled in cash within 60 days.

Related Party Tax Matters

In connection with the VMware Spin-off and concurrently with the execution of the Separation and Distribution Agreement, effective as of April 14, 2021, Dell Technologies and VMware entered into a Tax Matters Agreement (the “Tax Matters Agreement”) and agreed to terminate the Tax Sharing Agreement as amended on December 30, 2019 (together with the Tax Matters Agreement, the “Tax Agreements”).

The Tax Matters Agreement governs Dell Technologies’ and VMware’s respective rights and obligations regarding income and other taxes as well as related matters, including tax liabilities, benefits, attributes, and returns for periods both preceding and proceeding the spin-off.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

The timing of the tax payments due to and from VMware is governed by the Tax Agreements.

VMware’s portion of the mandatory one-time transition tax on accumulated earnings of foreign subsidiaries (the “Transition Tax”) is governed by a letter agreement between VMware and Dell Technologies entered into on April 1, 2019.

Pursuant to the Tax Agreements, net receipts from VMware were $ 286 million during the fiscal year ended February 2, 2024, a portion of which was received subsequent to the completion of Broadcom’s acquisition of VMware, and were immaterial for the fiscal years ended February 3, 2023 and January 28, 2022.

Such receipts were primarily related to VMware’s portion of the Transition Tax and federal income taxes on Dell Technologies’ consolidated income tax return.

As of February 2, 2024 and February 3, 2023, the amount due from VMware under the Tax Matters Agreement was $ 311 million and $ 599 million, respectively, and primarily related to VMware’s estimated tax obligation resulting from the Transition Tax.

The 2017 Tax Cuts and Jobs Act included a deferral election for an eight-year installment payment method on the Transition Tax.

Dell Technologies expects VMware to pay the remainder of its Transition Tax over a period of two years .

Upon consummation of the VMware Spin-off, Dell Technologies recorded net income tax indemnification receivables from VMware related to certain income tax liabilities for which Dell Technologies is jointly and severally liable, but for which it is indemnified by VMware under the Tax Matters Agreement.

The amounts that VMware may be obligated to pay Dell Technologies could vary depending on the outcome of certain unresolved tax matters, which may not be resolved for several years.

The net receivable as of February 2, 2024 and February 3, 2023 was $ 104 million and $ 146 million, respectively.

Amounts due from VMware as of February 2, 2024 under the Tax Matters Agreement and the indemnification receivable are no longer considered due from a related party.

In connection with the completion of the VMware Spin-off described in Note 11 of the Notes to the Consolidated Financial Statements, Dell Technologies and VMware entered into a Tax Matters Agreement effective as of April 14, 2021 (the “Tax Matters Agreement”), which governs the respective rights and obligations of Dell Technologies and VMware regarding income and other taxes as well as related matters, including tax liabilities and benefits, attributes, and returns for periods both preceding and following the VMware Spin-off.

Pursuant to the Tax Matters Agreement, net receipts from VMware during the fiscal year ended February 2, 2024 were $ 286 million, a portion of which was received subsequent to the completion of Broadcom’s acquisition of VMware, and were immaterial during the fiscal year ended February 3, 2023.

Such receipts were primarily related to VMware’s portion of the mandatory one-time transition tax on accumulated earnings of foreign subsidiaries and federal income taxes on Dell Technologies’ consolidated income tax return.

Other Related Parties

4 unchanged sentences

The following table presents additional information on selected assets included in the Consolidated Statements of Financial Position as of the dates indicated:

February 2, 2024 February 3, 2023

January 31, 2025 February 2, 2024

(in millions)

1 unchanged sentence

Cash and cash equivalents $ 3,633 $ 7,366

Restricted cash - other current assets (a) 136 272

Restricted cash - other non-current assets (a) 5 15

Cash and cash equivalents — held for sale (a) 62 —

Restricted cash — other current assets (b) 123 136

Restricted cash — other non-current assets (b) 1 5

Total cash, cash equivalents, and restricted cash $ 3,819 $ 7,507

4 unchanged sentences

Prepaid expenses:

Total prepaid expenses (b) $ 589 $ 641

Total prepaid expenses (c) $ 564 $ 589

Deferred costs:

Total deferred costs, current (b) $ 5,548 $ 5,459

Property, plant, and equipment, net (c):

Total deferred costs, current (c) $ 4,129 $ 5,548

Property, plant, and equipment, net:

Assets in a customer contract $ 5,204 $ 5,022

6 unchanged sentences

____________________

(a) Restricted cash includes cash required to be held in escrow pursuant to DFS securitization arrangements.

(b) Deferred costs and prepaid expenses are included in other current assets in the Consolidated Statements of Financial Position.

Amounts classified as long-term deferred costs are included in other non-current assets and are not disclosed above.

(c) The Company revised its presentation of property, plant, and equipment, net by major asset class as of February 2, 2024.

Prior period balances have been recast to conform to this presentation.

(d) During the fiscal years ended February 2, 2024, February 3, 2023, and January 28, 2022, the Company recognized $ 2.0 billion, $ 1.8 billion, and $ 1.6 billion, respectively, in depreciation expense.

(a) Held for sale represents the reclassification of Secureworks cash and cash equivalents to assets held for sale.

See Note 1 of the Notes to the Consolidated Financial Statements for more information about the sale of Secureworks.

(b) Restricted cash primarily includes cash required to be held in escrow pursuant to DFS securitization arrangements.

(c) Deferred costs and prepaid expenses are included in other current assets in the Consolidated Statements of Financial Position.

Amounts classified as long-term deferred costs and long-term prepaid expenses are included in other non-current assets and are not disclosed above.

(d) During the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023, the Company recognized $ 2.1 billion, $ 2.0 billion, and $ 1.8 billion, respectively, in depreciation expense.

DELL TECHNOLOGIES INC.

3 unchanged sentences

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

3 unchanged sentences

Service obligations honored ( 884 ) ( 849 ) ( 969 )

Warranty liability at end of period $ 426 $ 467 $ 480

Warranty liability at end of period (b) $ 424 $ 426 $ 467

____________________

1 unchanged sentence

The Company’s warranty liability process does not differentiate between estimates made for pre-existing warranties and those made for new warranty obligations.

(b) The liabilities for standard warranties are included in accrued and other and in non-current liabilities in the Consolidated Statements of Financial Position.

Severance Charges

The Company incurs costs related to employee severance and records a liability for these costs when it is probable that employees will be entitled to termination benefits and the amounts can be reasonably estimated.

The liability related to these actions is included in accrued and other current liabilities in the Consolidated Statements of Financial Position.

The liability related to these actions is included in accrued and other within current liabilities in the Consolidated Statements of Financial Position.

The following table presents the activity related to the Company’s severance liability for the periods indicated:

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

6 unchanged sentences

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

7 unchanged sentences

Supply Chain Finance Program

The Company maintains a Supply Chain Finance Program (the “SCF Program”), which enables eligible suppliers of the Company, at the supplier's sole discretion, to sell receivables due from the Company to a third-party financial institution.

The Company has no involvement in establishing the terms or conditions of the arrangement between its suppliers and the financial institution and no economic interest in a supplier's decision to sell a receivable.

Suppliers may elect to sell varying amounts of their outstanding receivables as part of the SCF Program.

The Company does not provide legally secured assets or other forms of guarantees under the arrangement.

The Company maintains a Supply Chain Finance Program (the “SCF Program”), which enables eligible suppliers, at the supplier's sole discretion, to sell receivables due from the Company to a third-party financial institution.

The Company has no involvement in establishing the terms or conditions of the arrangement between its suppliers and the financial institution, no economic interest in a supplier's decision to sell a receivable, and does not provide legally secured assets or other forms of guarantees under the arrangement.

The SCF Program does not impact the Company's liquidity as payments for participating supplier invoices are remitted by the Company to the financial institution on the original invoice due date, regardless of whether an individual invoice is sold by the supplier to the financial institution.

1 unchanged sentence

Payment terms with such suppliers vary and do not exceed 130 days.

Any amounts due to the financial institution for suppliers participating in the SCF Program are recorded within Accounts Payable on the Consolidated Statements of Financial Position and associated payments are included in cash flows from operating activities on the Consolidated Statements of Cash Flows.

As of February 2, 2024 and February 3, 2023, the Company had $ 1.1 billion and $ 1.0 billion, respectively, included within Accounts Payable representing invoices due to suppliers confirmed as valid under the SCF Program.

The Company’s outstanding obligations represent invoices due to suppliers confirmed as valid under the SCF Program and are included within accounts payable on the Consolidated Statements of Financial Position, while associated payments are included in cash flows from operating activities on the Consolidated Statements of Cash Flows.

The following table presents the changes in the Company’s outstanding obligations for the periods indicated:

Fiscal Year Ended

January 31, 2025

(in millions)

Confirmed obligations outstanding at the beginning of period $ 1,121

Invoices confirmed 5,191

Confirmed invoices paid ( 4,944 )

Confirmed obligations outstanding at the end of period $ 1,368

Interest and other, net

The following table presents information regarding interest and other, net for the periods indicated:

The following table presents information regarding interest and other, net as included in the Consolidated Statements of Income for the periods indicated:

Fiscal Year Ended

February 2, 2024 February 3, 2023 January 28, 2022

January 31, 2025 February 2, 2024 February 3, 2023

(in millions)

4 unchanged sentences

Foreign exchange ( 112 ) ( 199 ) ( 265 )

Gain on disposition of businesses and assets — — 3,968

Debt extinguishment gain (loss) 68 — ( 1,572 )

Legal settlement, net — — ( 894 )

8 unchanged sentences

The Company classifies the impact of government assistance on the Consolidated Statements of Income based on the underlying nature and purpose of the assistance.

During the fiscal years ended February 2, 2024 and February 3, 2023, government assistance received primarily consisted of the following:

During the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023, government assistance received primarily consisted of the following:

The Company received assistance from foreign governmental entities designed, in part, to promote competitive pricing by providing companies with an offset to local sales taxes incurred on the sales of products to customers.

3 unchanged sentences

Such expirations could be impacted by future legislation.

During the fiscal years ended February 2, 2024 and February 3, 2023, the Company recognized $ 288 million and $ 297 million, respectively, within net revenue on the Consolidated Statements of Income related to such assistance.

During the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023, the Company recognized $ 279 million, $ 288 million, and $ 297 million, respectively, within net revenue on the Consolidated Statements of Income related to such assistance.

The Company received incentives from foreign governmental entities to provide reimbursement for various costs incurred that are directly tied to the production or delivery of offerings sold to customers.

1 unchanged sentence

These agreements currently expire at various dates through 2029.

During the fiscal years ended February 2, 2024 and February 3, 2023, the Company recognized a benefit of $ 166 million and $ 318 million, respectively, to cost of net revenue on the Consolidated Statements of Income related to such assistance.

During the fiscal years ended January 31, 2025, February 2, 2024, and February 3, 2023, the Company recognized a benefit of $ 45 million, $ 166 million, and $ 318 million, respectively, to cost of net revenue on the Consolidated Statements of Income related to such assistance.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 22 — QUARTERLY RESULTS (UNAUDITED)

The following tables present selected unaudited Condensed Consolidated Statements of Income for each quarter of the periods indicated:

Three Months Ended

May 3, 2024 August 2, 2024 November 1, 2024 January 31, 2025

(in millions, except per share amounts)

Net revenue $ 22,244 $ 25,026 $ 24,366 $ 23,931

Gross margin $ 4,851 $ 5,361 $ 5,360 $ 5,678

Operating income $ 965 $ 1,392 $ 1,721 $ 2,159

Net income $ 992 $ 882 $ 1,170 $ 1,532

Net income attributable to Dell Technologies Inc.

$ 997 $ 887 $ 1,175 $ 1,533

Earnings per share attributable to Dell Technologies Inc.

Basic $ 1.41 $ 1.25 $ 1.67 $ 2.19

Diluted $ 1.37 $ 1.23 $ 1.64 $ 2.15

Three Months Ended

May 5, 2023 August 4, 2023 November 3, 2023 February 2, 2024

(in millions, except per share amounts)

Net revenue $ 20,922 $ 22,934 $ 22,251 $ 22,318

Gross margin $ 5,080 $ 5,416 $ 5,201 $ 5,372

Operating income $ 1,131 $ 1,194 $ 1,539 $ 1,547

Net income $ 632 $ 482 $ 1,050 $ 1,208

Net income attributable to Dell Technologies Inc.

$ 637 $ 489 $ 1,052 $ 1,210

Earnings per share attributable to Dell Technologies Inc.

Basic $ 0.88 $ 0.67 $ 1.46 $ 1.70

Diluted $ 0.86 $ 0.66 $ 1.42 $ 1.66

As discussed in Note 1 of the Notes to the Consolidated Financial Statements, the Company discovered accumulated credits from certain suppliers that were not recorded or not recorded in the correct period in its previously reported financial results.

The Company will revise its previously reported quarterly financial information based on the summary presented below in its future filings with the SEC, as applicable, to correct for the overstatement of cost of net revenue to the Consolidated Statements of Income, net of the related income tax effect, and the corresponding amounts affecting the Consolidated Statements of Financial Position.

The revision did not have an impact on the Company’s net revenue.

A summary of the corrections to the affected financial statement line items in these Condensed Consolidated Financial Statements is presented below for each quarterly period.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Condensed Consolidated Statements of Income

Three Months Ended Three Months Ended

May 3, 2024 May 5, 2023

As Reported Adjustment As Revised As Reported Adjustment As Revised

(in millions, except per share amounts)

Cost of net revenue:

Products $ 13,766 $ ( 45 ) $ 13,721 $ 12,375 $ ( 62 ) $ 12,313

Total cost of net revenue $ 17,438 $ ( 45 ) $ 17,393 $ 15,904 $ ( 62 ) $ 15,842

Gross margin $ 4,806 $ 45 $ 4,851 $ 5,018 $ 62 $ 5,080

Operating income $ 920 $ 45 $ 965 $ 1,069 $ 62 $ 1,131

Income before income taxes $ 547 $ 45 $ 592 $ 705 $ 62 $ 767

Income tax expense (benefit) $ ( 408 ) $ 8 $ ( 400 ) $ 127 $ 8 $ 135

Net income $ 955 $ 37 $ 992 $ 578 $ 54 $ 632

Net income attributable to Dell Technologies Inc.

$ 960 $ 37 $ 997 $ 583 $ 54 $ 637

Earnings per share attributable to Dell Technologies Inc.

Basic $ 1.36 $ 0.05 $ 1.41 $ 0.81 $ 0.07 $ 0.88

Diluted $ 1.32 $ 0.05 $ 1.37 $ 0.79 $ 0.07 $ 0.86

____________________

(a) The Company’s Condensed Consolidated Statements of Comprehensive Income were also affected by the revised net income amounts for the periods presented above.

Three Months Ended Three Months Ended

August 2, 2024 August 4, 2023

As Reported Adjustment As Revised As Reported Adjustment As Revised

(in millions, except per share amounts)

Cost of net revenue:

Products $ 16,079 $ ( 50 ) $ 16,029 $ 14,002 $ ( 29 ) $ 13,973

Total cost of net revenue $ 19,715 $ ( 50 ) $ 19,665 $ 17,547 $ ( 29 ) $ 17,518

Gross margin $ 5,311 $ 50 $ 5,361 $ 5,387 $ 29 $ 5,416

Operating income $ 1,342 $ 50 $ 1,392 $ 1,165 $ 29 $ 1,194

Income before income taxes $ 989 $ 50 $ 1,039 $ 714 $ 29 $ 743

Income tax expense $ 148 $ 9 $ 157 $ 259 $ 2 $ 261

Net income $ 841 $ 41 $ 882 $ 455 $ 27 $ 482

Net income attributable to Dell Technologies Inc.

$ 846 $ 41 $ 887 $ 462 $ 27 $ 489

Earnings per share attributable to Dell Technologies Inc.

Basic $ 1.19 $ 0.06 $ 1.25 $ 0.64 $ 0.03 $ 0.67

Diluted $ 1.17 $ 0.06 $ 1.23 $ 0.63 $ 0.03 $ 0.66

____________________

(a) The Company’s Condensed Consolidated Statements of Comprehensive Income were also affected by the revised net income amounts for the periods presented above.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Three Months Ended Three Months Ended

November 1, 2024 November 3, 2023

As Reported Adjustment As Revised As Reported Adjustment As Revised

(in millions, except per share amounts)

Cost of net revenue:

Products $ 15,541 $ ( 53 ) $ 15,488 $ 13,546 $ ( 53 ) $ 13,493

Total cost of net revenue $ 19,059 $ ( 53 ) $ 19,006 $ 17,103 $ ( 53 ) $ 17,050

Gross margin $ 5,307 $ 53 $ 5,360 $ 5,148 $ 53 $ 5,201

Operating income $ 1,668 $ 53 $ 1,721 $ 1,486 $ 53 $ 1,539

Income before income taxes $ 1,392 $ 53 $ 1,445 $ 1,180 $ 53 $ 1,233

Income tax expense $ 265 $ 10 $ 275 $ 176 $ 7 $ 183

Net income $ 1,127 $ 43 $ 1,170 $ 1,004 $ 46 $ 1,050

Net income attributable to Dell Technologies Inc.

$ 1,132 $ 43 $ 1,175 $ 1,006 $ 46 $ 1,052

Earnings per share attributable to Dell Technologies Inc.

Basic $ 1.61 $ 0.06 $ 1.67 $ 1.39 $ 0.07 $ 1.46

Diluted $ 1.58 $ 0.06 $ 1.64 $ 1.36 $ 0.06 $ 1.42

____________________

(a) The Company’s Condensed Consolidated Statements of Comprehensive Income were also affected by the revised net income amounts for the periods presented above.

Three Months Ended

February 2, 2024

As Reported Adjustment As Revised

(in millions, except per share amounts)

Cost of net revenue:

Products $ 13,393 $ ( 56 ) $ 13,337

Total cost of net revenue $ 17,002 $ ( 56 ) $ 16,946

Gross margin $ 5,316 $ 56 $ 5,372

Operating income $ 1,491 $ 56 $ 1,547

Income before income taxes $ 1,288 $ 56 $ 1,344

Income tax expense $ 130 $ 6 $ 136

Net income $ 1,158 $ 50 $ 1,208

Net income attributable to Dell Technologies Inc.

$ 1,160 $ 50 $ 1,210

Earnings per share attributable to Dell Technologies Inc.

Basic $ 1.63 $ 0.07 $ 1.70

Diluted $ 1.59 $ 0.07 $ 1.66

____________________

(a) The Company’s Condensed Consolidated Statements of Comprehensive Income were also affected by the revised net income amounts for the periods presented above.

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

Condensed Consolidated Statements of Cash Flows

Three Months Ended Six Months Ended Nine Months Ended

May 3, 2024 August 2, 2024 November 1, 2024

As Reported Adjustment As Revised As Reported Adjustment As Revised As Reported Adjustment As Revised

(in millions)

Cash flow from operations:

Net income $ 955 $ 37 $ 992 $ 1,796 $ 78 $ 1,874 $ 2,923 $ 121 $ 3,044

Adjustments to reconcile net income to net cash provided by operating activities:

Other assets and liabilities $ ( 592 ) $ ( 1 ) $ ( 593 ) $ 250 $ ( 3 ) $ 247 $ 2,147 $ ( 7 ) $ 2,140

Accounts payable $ 1,241 $ ( 36 ) $ 1,205 $ 4,801 $ ( 75 ) $ 4,726 $ 4,089 $ ( 114 ) $ 3,975

Three Months Ended Six Months Ended Nine Months Ended

May 5, 2023 August 4, 2023 November 3, 2023

As Reported Adjustment As Revised As Reported Adjustment As Revised As Reported Adjustment As Revised

(in millions)

Cash flow from operations:

Net income $ 578 $ 54 $ 632 $ 1,033 $ 81 $ 1,114 $ 2,037 $ 127 $ 2,164

Adjustments to reconcile net income to net cash provided by operating activities:

Other assets and liabilities $ ( 1,322 ) $ ( 11 ) $ ( 1,333 ) $ ( 2,248 ) $ ( 14 ) $ ( 2,262 ) $ ( 2,096 ) $ ( 13 ) $ ( 2,109 )

Accounts payable $ ( 726 ) $ ( 43 ) $ ( 769 ) $ 1,427 $ ( 67 ) $ 1,360 $ 1,012 $ ( 114 ) $ 898

DELL TECHNOLOGIES INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTE 23 — SUBSEQUENT EVENTS

Except as otherwise disclosed, there were no known events occurring after February 2, 2024, and up until the date of issuance of this report that would materially affect the information presented herein.

There were no known events occurring after January 31, 2025, and up until the date of issuance of this report that would materially affect the information presented herein.

ITEM 9 — CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data