Restructuring and Acquisition-Related Charges

For the three months ended June 30, 2016, we recorded a restructuring and acquisition-related credit of $1 million and for the six months ended June 30, 2016, we incurred restructuring and acquisition-related charges of $48 million. For the three and six months ended June 30, 2015, we incurred restructuring and acquisition-related charges of $23 million and $158 million, respectively.

For the three and six months ended June 30, 2016, EMC recorded a $1 million credit and a $6 million credit, respectively, related to our prior restructuring programs. For the three months ended June 30, 2016, VMware incurred a $1 million credit related to its restructuring programs. For the six months ended June 30, 2016, VMware incurred $52 million of restructuring charges, primarily related to its current year restructuring program. Additionally, for the three and six months ended June 30, 2016, VMware incurred $1 million and $2 million, respectively, of charges in connection with acquisitions for financial, advisory, legal and accounting services.

For the three and six months ended June 30, 2015, EMC incurred $23 million and $133 million, respectively, of restructuring charges, primarily related to our 2015 restructuring programs, and $2 million and $3 million, respectively, of charges in connection with acquisitions for financial, advisory, legal and accounting services. For the three months ended June 30, 2015, VMware recognized a credit of $2 million related to its restructuring program and for the six months ended June 30, 2015, VMware incurred $21 million of restructuring charges, primarily related to its 2015 program. For the six months ended June 30, 2015, VMware incurred $1 million of charges in connection with acquisitions for financial, advisory, legal and accounting services.

In the first quarter of 2016, VMware approved a plan to streamline its operations, with plans to reinvest the associated savings in field, technical and support resources associated with growth products. As a result, approximately 800 positions at VMware were eliminated during the six months ended June 30, 2016. Actions relating to VMware’s plan were substantially completed by June 30, 2016.

In the first and second quarters of 2015, EMC implemented restructuring programs to create further operational efficiencies which resulted in a workforce reduction of approximately 1,320 and 160 positions, respectively. The actions impacted positions around the globe covering our Information Storage, RSA Information Security, Enterprise Content Division and Pivotal segments. All of these actions were completed within a year of the start of the program. In the first quarter of 2015, VMware eliminated approximately 350 positions across all major functional groups and geographies to streamline its operations. All of these actions were completed within a year of the start of the program.

For the three and six months ended June 30, 2016, we recognized $5 million and $10 million, respectively, of lease termination costs for facilities vacated in the period in accordance with our plan as part of all of our restructuring programs and for costs associated with terminating other contractual obligations. For the three and six months ended June 30, 2015, we recognized $10 million and $16 million, respectively, of lease termination costs for facilities vacated in the period in accordance with our plan as part of all of our restructuring programs and for costs associated with terminating other contractual obligations. These accruals are expected to be utilized by the end of 2022.

The activity for the restructuring programs is presented below (tables in millions):

Three Months Ended June 30, 2016:



EMC Programs
Category	Balance as of March 31, 2016		Adjustments to the Provision			Utilization			Balance as of June 30, 2016
Workforce reductions	$	213	$	(6	)	$	(67	)	$	140
Consolidation of excess facilities and other contractual obligations	22		5			(5		)	22
Total	$	235	$	(1	)	$	(72	)	$	162



VMware Programs
Category	Balance as of March 31, 2016		Adjustments to the Provision			Utilization			Balance as of June 30, 2016
Workforce reductions	$	27	$	(1	)	$	(24	)	$	2
Consolidation of excess facilities and other contractual obligations	3		—			—			3
Total	$	30	$	(1	)	$	(24	)	$	5

Six Months Ended June 30, 2016:



EMC Programs
Category	Balance as of December 31, 2015		Adjustments to the Provision			Utilization			Balance as of June 30, 2016
Workforce reductions	$	322	$	(16	)	$	(166	)	$	140
Consolidation of excess facilities and other contractual obligations	20		10			(8		)	22
Total	$	342	$	(6	)	$	(174	)	$	162



VMware Programs
Category	Balance as of December 31, 2015		2016 Charges		Utilization			Balance as of June 30, 2016
Workforce reductions	$	3	$	49	$	(50	)	$	2
Consolidation of excess facilities and other contractual obligations	—		3		—			3
Total	$	3	$	52	$	(50	)	$	5

Three Months Ended June 30, 2015:



2015 EMC Programs
Category	Balance as of March 31, 2015		2015 Charges		Utilization			Balance as of June 30, 2015
Workforce reductions	$	96	$	17	$	(24	)	$	89
Consolidation of excess facilities and other contractual obligations	6		10		(4		)	12
Total	$	102	$	27	$	(28	)	$	101



Other EMC Programs
Category	Balance as of March 31, 2015		Adjustments to the Provision			Utilization			Balance as of June 30, 2015
Workforce reductions	$	61	$	(4	)	$	(14	)	$	43
Consolidation of excess facilities and other contractual obligations	14		—			(1		)	13
Total	$	75	$	(4	)	$	(15	)	$	56



VMware Programs
Category	Balance as of March 31, 2015		Adjustments to the Provision			Utilization			Balance as of June 30, 2015
Workforce reductions	$	16	$	(2	)	$	(12	)	$	2
Consolidation of excess facilities and other contractual obligations	—		—			—			—
Total	$	16	$	(2	)	$	(12	)	$	2

Six Months Ended June 30, 2015:



2015 EMC Programs
Category	Balance as of December 31, 2014		2015 Charges		Utilization			Balance as of June 30, 2015
Workforce reductions	$	—	$	123	$	(34	)	$	89
Consolidation of excess facilities and other contractual obligations	—		16		(4		)	12
Total	$	—	$	139	$	(38	)	$	101



Other EMC Programs
Category	Balance as of December 31, 2014		Adjustments to the Provision			Utilization			Balance as of June 30, 2015
Workforce reductions	$	102	$	(6	)	$	(53	)	$	43
Consolidation of excess facilities and other contractual obligations	19		—			(6		)	13
Total	$	121	$	(6	)	$	(59	)	$	56



VMware Programs
Category	Balance as of December 31, 2014		2015 Charges		Utilization			Balance as of June 30, 2015
Workforce reductions	$	8	$	21	$	(27	)	$	2
Consolidation of excess facilities and other contractual obligations	—		—		—			—
Total	$	8	$	21	$	(27	)	$	2