8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15 (d) OF

THE SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): January 26, 2010

EMC CORPORATION

(Exact Name of Registrant as Specified in Charter)

Massachusetts	1-9853	No. 04-2680009
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

176 South Street, Hopkinton, MA	01748
(Address of Principal Executive Offices)	(Zip code)

Registrant’s telephone number, including area code: (508) 435-1000

N/A

(Former Name or Former Address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

On January 26, 2010, EMC Corporation (“EMC”) issued a press release announcing financial results for the quarter and full fiscal year ended December 31, 2009. The press release is attached hereto as Exhibit 99.1 and incorporated by reference herein.

The information in this Item 2.02 and the Exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, regardless of any general incorporation language in such filing.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

99.1 Press release of EMC Corporation dated January 26, 2010

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

EMC CORPORATION
By:	/S/    DAVID I. GOULDEN
	David I. Goulden
	Executive Vice President and Chief Financial Officer

Date: January 26, 2010

3

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press release of EMC Corporation dated January 26, 2010

EX-99.1

Exhibit 99.1

Contact: Dave Farmer 508-293-7206 farmer_dave@emc.com

EMC ACHIEVES RECORD FOURTH-QUARTER REVENUE AHEAD OF COMPANY EXPECTATIONS; QUARTERLY EARNINGS PER SHARE UP 54% YEAR OVER YEAR

Fourth-Quarter Highlights

• Record fourth-quarter consolidated revenue of $4.1 billion – up 17% sequentially; ahead of company outlook of $4 billion

• Fourth-quarter GAAP diluted EPS of $0.20 – up 43% sequentially and 54% year over year

• Fourth-quarter non-GAAP diluted EPS of $0.33 – up 43% sequentially; ahead of company outlook of $0.30

• Fourth-quarter operating cash flow of $1.0 billion; Record fourth-quarter free cash flow of $793 million

HOPKINTON, Mass. – January 26, 2010 – EMC Corporation (NYSE:EMC), the world leader in information infrastructure solutions, today reported financial results for the fourth quarter of 2009. Ongoing strategic investments aligned to key customer priorities helped EMC achieve record fourth-quarter revenue. A continued focus on efficiencies and expense controls helped deliver expanded gross and operating margins, record quarterly free cash flow and fourth-quarter profit that exceeded prior company outlook.

Consolidated revenue for the fourth quarter of 2009 reached a record $4.1 billion, an increase of 17% sequentially, 2% year over year and $100 million more than the outlook provided by EMC for the fourth quarter of 2009. Fourth-quarter GAAP net income attributable to EMC reached $426.5 million, an increase of 43% sequentially and 58% year over year. Fourth-quarter GAAP diluted earnings per share were $0.20, up 43% sequentially and 54% compared with the year-ago quarter. Non-GAAP¹ net income attributable to EMC for the fourth quarter was $695.5 million, an increase of 45% sequentially and 11% compared with the fourth quarter of 2008. Non-GAAP¹ earnings per diluted share were $0.33 for the fourth quarter, $0.03 ahead of the company outlook provided for the fourth quarter of 2009. Fourth-quarter non-GAAP¹ earnings per diluted share increased 43% sequentially and were up 6% year over year.²

During the fourth quarter, EMC expanded gross and operating margins on a sequential basis, generated operating cash flow of $1.0 billion and achieved record quarterly free cash flow of $793 million. EMC completed the fourth quarter with $9.4 billion in cash and investments.

For the full year 2009, EMC achieved total consolidated revenue of $14.0 billion. GAAP net income attributable to EMC for 2009 was $1.1 billion or $0.55 per diluted share. Non-GAAP³ net income attributable to EMC for the full year was $1.9 billion or $0.90 per diluted share. For comparison, GAAP net income attributable to EMC for 2008 was $1.3 billion or $0.61 per diluted share and non-GAAP³ net income attributable to EMC for 2008² was $2.1 billion or $1.00 per diluted share. For 2009, EMC’s operating cash flow was $3.3 billion and free cash flow was $2.6 billion, an increase of 2% year over year.

Joe Tucci, EMC Chairman and Chief Executive Officer, said, “Aggressive investment in core technology and strategic partnerships during the downturn, combined with heightened operational discipline, leaves EMC stronger than ever financially and intensely focused on our customers. We are well positioned to lead the industry’s newest and potentially largest wave of IT, which we and others refer to as cloud computing. As we execute on our vision for where the industry is heading, EMC’s primary focus is on helping customers safely build out their next-generation, fully virtualized data centers and lead them along the journey to private cloud computing, which offers the promise of a dramatically more efficient and effective model for delivering IT as a service.”

David Goulden, EMC Executive Vice President and Chief Financial Officer, said, “Emerging from the worst global recession in company history, EMC is in the best financial and operational shape ever. We refined our financial model to a new level of efficiency and cost discipline, while continuing to invest in strategic technologies and high-growth markets. We rolled out new and more-advanced solutions and services with the best quality in our history and gained market share. With this positive momentum, EMC stands well positioned to continue to gain share in key markets and drive even greater profitability in 2010.”

Fourth-Quarter Highlights

EMC’s Information Infrastructure business for the fourth quarter – comprising product and service revenue from the company’s Information Storage, RSA Security, and Content Management and Archiving business segments – reached $3.5 billion, an increase of 15% sequentially. Within the Information Infrastructure business, the company’s Information Storage and Content Management and Archiving business segments achieved double-digit sequential revenue growth and EMC’s RSA Security business achieved record quarterly revenue. Fourth-quarter highlights included solid customer demand and strong sequential revenue growth for EMC’s Data Domain and Avamar next-generation backup and recovery solutions, EMC’s market-leading Symmetrix and CLARiiON networked storage systems and EMC Celerra unified storage systems; and continued strong demand for EMC’s RSA information security solutions, consumer and small business-focused Iomega products and EMC’s broad portfolio of consulting and professional services.

VMware (NYSE: VMW), which is majority-owned by EMC, contributed fourth-quarter revenue of $607 million.

EMC consolidated fourth-quarter revenue from the United States reached $2.2 billion, an increase of 14% sequentially and 1% year over year, representing 53% of consolidated fourth-quarter revenue. Revenue from EMC’s business operations outside of the United States reached $1.9 billion, an increase of 20% sequentially and 4% year over year, representing 47% of consolidated fourth-quarter revenue.

2009 Highlights

Full-year 2009 consolidated revenue was $14.0 billion. Revenue from EMC’s Information Infrastructure business reached $12.0 billion and VMware contributed revenue of $2.0 billion. Throughout the year, EMC executed on numerous strategic initiatives that collectively helped strengthen the company’s market leadership and advance its competitive lead, including:

• Sustained aggressive investment in research and development, totaling 12% of annual consolidated 2009 revenue, resulted in innovation across all business units. For example, EMC introduced an entirely new approach to high-end data storage with the EMC Virtual Matrix Architecture and EMC Symmetrix V-Max storage systems, unprecedented automation capabilities across all primary EMC storage platforms with the new EMC fully automated storage tiering (FAST) technology, and more than 30 new EMC services and solutions to drive the acceleration of private cloud computing.

• Use of financial strength to make strategic acquisitions, including deduplication storage solutions leader Data Domain, and increase investment levels in higher-growth markets and geographies.

• Tighter alignment with strategic partners, demonstrated by the Virtual Computing Environment coalition formed by EMC and Cisco with VMware, the extension of EMC’s strategic alliance with Microsoft, as well as enhanced technology integration and expanded solutions and services support with major industry players such as Cisco, VMware, Microsoft, Dell and others.

• Further movement and penetration down market, including a wave of new consumer storage technologies and services from Iomega and Mozy.

Business Outlook

The following statements are based on current expectations. These statements are forward-looking, and actual results may differ materially. These statements do not give effect to the potential impact of mergers, acquisitions, divestitures or business combinations that may be announced or closed after the date hereof. These statements supersede all prior statements regarding 2010 financial results set forth in prior EMC news releases.

All dollar amounts and percentages set forth below should be considered to be approximations.

• Consolidated EMC revenues are expected to be $16.0 billion for 2010.

• 2010 GAAP research and development (“R&D”) expense and non-GAAP R&D expense are each expected to increase 20% over 2009. Excluded from the increase in non-GAAP R&D expense is stock-based compensation expense of $42 million and intangible asset amortization of $8 million.

• Transition costs to a more efficient cost structure are expected to be $50 million in 2010.

• GAAP operating income is expected to be 13% of revenues for 2010 and non-GAAP operating income is expected to be 20% of revenues for 2010. Excluded from non-GAAP operating income are restructuring and acquisition-related charges, stock-based compensation expense and intangible asset amortization, which account for less than 1%, 5% and 2% of revenues, respectively.

• Total non-operating expense, which includes investment income, interest expense and other expense, is expected to be $90 million in 2010.

• Consolidated GAAP diluted earnings per share are expected to be $0.78 for 2010.

• Consolidated non-GAAP diluted earnings per share, excluding the impact of restructuring and acquisition-related charges, stock-based compensation expense and intangible asset amortization are expected to be $1.12 for 2010.

• Consolidated restructuring and acquisition-related charges, stock-based compensation expense and intangible asset amortization are expected to be $0.02, $0.24 and $0.08 per diluted share, respectively for 2010.

• The consolidated GAAP income tax rate is expected to be 17% for 2010. Excluding the impact of restructuring and acquisition-related charges, stock-based compensation expense and intangible asset amortization, which collectively impact the tax rate by 3%, the consolidated non-GAAP income tax rate is expected to be 20% for 2010. Both GAAP and non-GAAP income tax rates assume that the U.S. research and development tax credit will be re-enacted in 2010.

• The weighted average outstanding diluted shares are expected to be 2.12 billion for 2010.

• EMC expects to repurchase up to $1.0 billion of the company’s common stock.

Supporting Resources

• EMC will host its 2009 fourth-quarter earnings conference call today at 8:30 a.m. ET, which will be available on EMC’s web site at http://www.emc.com/about/investor-relations/index.htm

• Additional information regarding EMC’s financials, as well as a webcast of the conference call, will be available at 8:30 a.m. ET at http://www.emc.com/about/investor-relations/index.htm

• Visit http://ir.vmware.com for more information about VMware’s fourth-quarter financial results.

About EMC

EMC Corporation (NYSE: EMC) is the world’s leading developer and provider of information infrastructure technology and solutions that enable organizations of all sizes to transform the way they compete and create value from their information. Information about EMC’s products and services can be found at www.EMC.com.

# # #

¹Items excluded from the non-GAAP results are restructuring and acquisition-related charges, stock-based compensation expense, intangible asset amortization and a special income tax charge for the fourth quarter of 2009 and restructuring charge, IPR&D charge, stock-based compensation expense and intangible asset amortization for the fourth quarter of 2008. See attached schedules for reconciliation of GAAP to non-GAAP.

²The results for 2008 have been adjusted to give effect to the adoption of authoritative guidance relating to non-controlling interests and the accounting for convertible debt instruments.

³ Items excluded from the non-GAAP results are gains on Data Domain and SpringSource common stock, restructuring and acquisition-related charges, stock-based compensation expense, intangible asset amortization and a special income tax charge for 2009 and restructuring charge, IPR&D charge, special income tax benefit, stock-based compensation expense and intangible asset amortization for 2008. See attached schedules for reconciliation of GAAP to non-GAAP.

EMC, Avamar, Celerra, CLARiiON, Symmetrix, Symmetrix V-Max and Virtual Matrix Architecture are registered trademarks of EMC Corporation. RSA is a registered trademark of RSA Security Inc. VMware is a registered trademark of VMware, Inc. Iomega is a registered trademark of Iomega Corporation. Data Domain is a registered trademark of Data Domain, Inc. Mozy is a registered trademark of Decho Corporation. SpringSource is a registered trademark of SpringSource, Inc. All other trademarks used are the property of their respective owners.

Forward-Looking Statements

This release contains “forward-looking statements” as defined under the Federal Securities Laws. Actual results could differ materially from those projected in the forward-looking statements as a result of certain risk factors, including but not limited to: (i) adverse changes in general economic or market conditions; (ii) delays or reductions in information technology spending; (iii) our ability to protect our proprietary technology; (iv) risks associated with managing the growth of our business, including risks associated with acquisitions and investments and the challenges and costs of integration, restructuring and achieving anticipated synergies; (v) fluctuations in VMware, Inc.’s operating results and risks associated with trading of VMware stock; (vi) competitive factors, including but not limited to pricing pressures and new product introductions; (vii) the relative and varying rates of product price and component cost declines and the volume and mixture of product and services revenues; (viii) component and product quality and availability; (ix) the transition to new products, the uncertainty of customer acceptance of new product offerings and rapid technological and market change; (x) insufficient, excess or obsolete inventory; (xi) war or acts of terrorism; (xii) the ability to attract and retain highly qualified employees; (xiii) fluctuating currency exchange rates; (xiv) litigation that we may be involved in; and (xv) other one-time events and other important factors disclosed previously and from time to time in EMC’s filings with the U.S. Securities and Exchange Commission. EMC disclaims any obligation to update any such forward-looking statements after the date of this release.

Use of Non-GAAP Financial Measures

This release, the accompanying schedules and the additional content that is available on EMC’s website contain non-GAAP financial measures. These non-GAAP financial measures, which are used as measures of EMC’s performance or liquidity, should be considered in addition to, not as a substitute for, measures of EMC’s financial performance or liquidity prepared in accordance with GAAP. EMC’s non-GAAP financial measures may be defined differently from time to time and may be defined differently than similar terms used by other companies, and accordingly, care should be exercised in understanding how EMC defines its non-GAAP financial measures in this release.

Where specified in the accompanying schedules for various periods entitled “Reconciliation of GAAP to Non-GAAP,” certain items noted on each such specific schedule (including, where noted, amounts relating to gains on Data Domain and SpringSource common stock, restructuring and acquisition-related charges, special income tax charge, stock-based compensation expense, intangible asset amortization, IPR&D charge, special income tax benefit and restructuring charge) are excluded from the non-GAAP financial measures.

EMC’s management uses the non-GAAP financial measures in the accompanying schedules to gain an understanding of EMC’s comparative operating performance (when comparing such results with previous periods or forecasts) and future prospects and excludes the above-listed items from its internal financial statements for purposes of its internal budgets and each reporting segment’s financial goals. These non-GAAP financial measures are used by EMC’s management in their financial and operating decision-making because management believes they reflect EMC’s ongoing business in a manner that allows meaningful period-to-period comparisons. EMC’s management believes that these non-GAAP financial measures provide useful information to investors and others (a) in understanding and evaluating EMC’s current operating performance and future prospects in the same manner as management does, if they so choose, and (b) in comparing in a consistent manner the Company’s current financial results with the Company’s past financial results.

This release also includes disclosures regarding free cash flow which is a non-GAAP financial measure. Free cash flow is defined as net cash provided by operating activities less additions to property, plant and equipment and capitalized software development costs. EMC uses free cash flow, among other measures, to evaluate the ability of its operations to generate cash that is available for purposes other than capital expenditures and capitalized software development costs. Management believes that information regarding free cash flow provides investors with an important perspective on the cash available to make strategic acquisitions and investments, repurchase shares, service debt and fund ongoing operations. As free cash flow is not a measure of liquidity calculated in accordance with GAAP, free cash flow should be considered in addition to, but not as a substitute for, the analysis provided in the statement of cash flows.

Certain items in the accompanying schedules refer to growth rates at constant currency or adjusting for currency so that business results can be viewed without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons of EMC’s business performance. To present this information, current period results for entities reporting in currencies other than US dollars are converted into US dollars at the exchange rate applied in each month of the prior year quarter. Constant currency includes the impacts from EMC’s hedging program.

All of the foregoing non-GAAP financial measures have limitations. Specifically, the non-GAAP financial measures that exclude the items noted above do not include all items of income and expense that affect EMC’s operations. Further, these non-GAAP financial measures are not prepared in accordance with GAAP, may not be comparable to non-GAAP financial measures used by other companies and do not reflect any benefit that such items may confer on EMC. Management compensates for these limitations by also considering EMC’s financial results as determined in accordance with GAAP.

EMC CORPORATION

Consolidated Income Statements

(in thousands, except per share amounts)

Unaudited

	Three Months Ended						Twelve Months Ended
	December 31, 2009			December 31, 2008			December 31, 2009			December 31, 2008
				(As Adjusted)						(As Adjusted)
Revenues:
Product sales	$	2,653,174		$	2,776,794		$	8,828,145		$	10,071,816
Services		1,446,992			1,239,844			5,197,765			4,804,347
		4,100,166			4,016,638			14,025,910			14,876,163
Cost and expenses:
Cost of product sales		1,228,252			1,313,468			4,406,187			4,663,667
Cost of services		494,265			477,486			1,874,824			1,990,127
Research and development		424,243			434,521			1,627,509			1,721,330
Selling, general and administrative		1,284,373			1,211,120			4,538,125			4,601,588
In-process research and development		—			6,576			—			85,780
Restructuring and acquisition-related charges		23,903			240,694			107,490			244,735
Operating income		645,130			332,773			1,471,775			1,568,936
Non-operating income (expense):
Investment income		31,137			54,462			140,430			247,049
Interest expense		(46,571	)		(44,741	)		(182,499	)		(176,355	)
Other income (expense), net		(14,911	)		(18,518	)		2,370			(39,405	)
Total non-operating income (expense)		(30,345	)		(8,797	)		(39,699	)		31,289
Income before tax		614,785			323,976			1,432,076			1,600,225
Income tax provision		177,919			36,336			274,381			280,396
Net income		436,866			287,640			1,157,695			1,319,829
Less: Net income attributable to the non-controlling interests in VMware, Inc.		(10,376	)		(17,718	)		(33,724	)		(44,725	)
Net income attributable to EMC Corporation	$	426,490		$	269,922		$	1,123,971		$	1,275,104
Net income per weighted average share, basic:
common shareholders:	$	0.21		$	0.13		$	0.56		$	0.62
Net income per weighted average share, diluted:
common shareholders:	$	0.20		$	0.13		$	0.55		$	0.61
Weighted average shares, basic		2,041,601			2,012,389			2,022,371			2,048,506
Weighted average shares, diluted		2,103,569			2,028,635			2,055,146			2,079,853

Reconciliation of GAAP to Non-GAAP

For the Three Months Ended December 31, 2009

(in thousands, except per share amounts)

Unaudited

	Revenue			Cost of Revenue			Research and Development			Selling, General and Administrative			Restructuring and Acquisition- Related Charges			Operating Income		Other Expense, net			Income Before Taxes			Income Tax Provision			Net Income			Net Income Attributable to VMware			Net Income Attributable to EMC			Net Income per Weighted Average Share, Basic			Net Income per Weighted Average Share, Diluted
EMC Consolidated GAAP	$	4,100,166		$	1,722,517		$	424,243		$	1,284,373		$	23,903		$	645,130	$	(30,345	)	$	614,785		$	177,919		$	436,866		$	(10,376	)	$	426,490		$	0.209		$	0.202
Restructuring and acquisition-related charges		—			—			—			—			(23,903	)		23,903		—			23,903			9,130			14,773			(152	)		14,621		$	0.007		$	0.007
Special income tax charge		—			—			—			—			—			—		—			—			(77,168	)		77,168			—			77,168		$	0.038		$	0.037
EMC Consolidated Adjusted (1)		4,100,166			1,722,517			424,243			1,284,373			—			669,033		(30,345	)		638,688			109,881			528,807			(10,528	)		518,279		$	0.254		$	0.246
Stock-based compensation expense		—			(30,136	)		(67,040	)		(84,421	)		—			181,597		—			181,597			36,849			144,748			(11,554	)		133,194		$	0.065		$	0.063
Intangible amortization		—			(36,488	)		(3,191	)		(26,224	)		—			65,903		—			65,903			21,443			44,460			(468	)		43,992		$	0.022		$	0.021
EMC Consolidated Non-GAAP (2)	$	4,100,166		$	1,655,893		$	354,012		$	1,173,728		$	—		$	916,533	$	(30,345	)	$	886,188		$	168,173		$	718,015		$	(22,550	)	$	695,465		$	0.341		$	0.330
EMC Information Infrastructure GAAP	$	3,493,623		$	1,614,231		$	290,130		$	994,389		$	23,075		$	571,798	$	(24,067	)	$	547,731		$	167,141		$	380,590		$	—		$	380,590		$	0.186		$	0.181
Restructuring and acquisition-related charges		—			—			—			—			(23,075	)		23,075		—			23,075			9,130			13,945			—			13,945		$	0.007		$	0.007
Special income tax charge		—			—			—			—			—			—		—			—			(77,168	)		77,168			—			77,168		$	0.038		$	0.037
EMC Information Infrastructure Adjusted (3)		3,493,623			1,614,231			290,130			994,389			—			594,873		(24,067	)		570,806			99,103			471,703			—			471,703		$	0.231		$	0.224
Stock-based compensation expense		—			(20,633	)		(29,880	)		(58,024	)		—			108,537		—			108,537			26,614			81,923			—			81,923		$	0.040		$	0.039
Intangible amortization		—			(32,960	)		(3,124	)		(25,710	)		—			61,794		—			61,794			19,881			41,913			—			41,913		$	0.021		$	0.020
EMC Information Infrastructure Non-GAAP (4)	$	3,493,623		$	1,560,638		$	257,126		$	910,655		$	—		$	765,204	$	(24,067	)	$	741,137		$	145,598		$	595,539		$	—		$	595,539		$	0.292		$	0.283
VMware standalone GAAP	$	608,201		$	107,506		$	136,262		$	293,276		$	—		$	71,157	$	(3,920	)	$	67,237		$	10,828		$	56,409		$	—		$	56,409		$	0.028		$	0.027
GAAP adjustments and eliminations		(1,658	)		780			(2,149	)		(3,292	)		828			2,175		(2,358	)		(183	)		(50	)		(133	)		(10,376	)		(10,509	)	$	(0.005	)	$	(0.006	)
VMware within EMC GAAP (5)		606,543			108,286			134,113			289,984			828			73,332		(6,278	)		67,054			10,778			56,276			(10,376	)		45,900		$	0.022		$	0.021
Acquisition-related charges		—			—			—			—			(828	)		828		—			828			—			828			(152	)		676		$	—		$	—
VMware within EMC Adjusted (6)		606,543			108,286			134,113			289,984			—			74,160		(6,278	)		67,882			10,778			57,104			(10,528	)		46,576		$	0.023		$	0.022
Stock-based compensation expense		—			(9,503	)		(37,160	)		(26,397	)		—			73,060		—			73,060			10,235			62,825			(11,554	)		51,271		$	0.025		$	0.024
Intangible amortization		—			(3,528	)		(67	)		(514	)		—			4,109		—			4,109			1,562			2,547			(468	)		2,079		$	0.001		$	0.001
VMware within EMC Non-GAAP (7)	$	606,543		$	95,255		$	96,886		$	263,073		$	—		$	151,329	$	(6,278	)	$	145,051		$	22,575		$	122,476		$	(22,550	)	$	99,926		$	0.049		$	0.047
																												Wtd. Average Share O/S									2,041,601			2,103,569
																												Incremental VMware dilution											$	1,150
																												Minority interest percentage												0.1839

Reconciliation of GAAP to Non-GAAP

For the Three Months Ended December 31, 2009

(in thousands, except per share amounts)

Unaudited

(Continued)

The following costs are included in EMC Consolidated Non-GAAP and EMC Information Infrastructure Non-GAAP results

	Revenue		Cost of Revenue		Research and Development		Selling, General and Administrative		Restructuring and Acquisition- Related Charges		Operating Income			Other Expense, net			Income Before Taxes			Income Tax Provision			Net Income			Net Income Attributable to VMware		Net Income Attributable to EMC			Net Income per Weighted Average Share, Basic			Net Income per Weighted Average Share, Diluted
Non-cash interest expense on convertible debt (8)	$	—	$	—	$	—	$	—	$	—	$	—		$	(27,785	)	$	(27,785	)	$	(9,253	)	$	(18,532	)	$	—	$	(18,532	)	$	(0.009	)	$	(0.009	)
Transition costs (9)		—		167		3,243		15,921		—		(19,331	)		—			(19,331	)		(5,053	)		(14,278	)		—	$	(14,278	)	$	(0.007	)	$	(0.007	)
	$	—	$	167	$	3,243	$	15,921	$	—	$	(19,331	)	$	(27,785	)	$	(47,116	)	$	(14,306	)	$	(32,810	)	$	—	$	(32,810	)	$	(0.016	)	$	(0.016	)

(1) Represents EMC Consolidated GAAP excluding restructuring, acquisition-related charges and a special income tax charge.

(2) Represents EMC Consolidated Adjusted excluding stock-based compensation expense and intangible amortization.

(3) Represents EMC Information Infrastructure GAAP excluding restructuring, acquisition-related charges and a special income tax charge.

(4) Represents EMC Information Infrastructure Adjusted excluding stock-based compensation expense and intangible amortization.

(5) Represents VMware within EMC GAAP.

(6) Represents VMware within EMC GAAP excluding acquisition-related charges.

(7) Represents VMware within EMC Adjusted excluding stock-based compensation expense and intangible amortization.

(8) Represents the non-cash interest charge associated with our convertible senior notes due 2011 and 2013 totaling $3,450 million.

(9) Represents incremental costs incurred to transform our current cost structure to a more streamlined cost structure.

Note: schedule may not add due to rounding

Reconciliation of GAAP to Non-GAAP

For the Three Months Ended December 31, 2008

(in thousands, except per share amounts)

Unaudited

	Revenue			Cost of Revenue			Research and Development			Selling, General and Administrative			IPR&D Charge			Restructuring Charge			Operating Income		Other Income, net			Income Before Taxes		Income Tax Provision			Net Income			Net Income Attributable to VMware			Net Income Attributable to EMC			Net Income per Weighted Average Share, Basic			Net Income per Weighted Average Share, Diluted
EMC Consolidated GAAP	$	4,016,638		$	1,790,954		$	434,521		$	1,211,120		$	6,576		$	240,694		$	332,773	$	(8,797	)	$	323,976	$	36,336		$	287,640		$	(17,718	)	$	269,922		$	0.134		$	0.133
Restructuring charge		—			—			—			—			—			(240,694	)		240,694		6,877			247,571		48,037			199,534			—			199,534		$	0.099		$	0.098
IPR&D charge		—			—			—			—			(6,576	)		—			6,576		—			6,576		2,229			4,347			(691	)		3,656		$	0.002		$	0.002
EMC Consolidated Adjusted (1)		4,016,638			1,790,954			434,521			1,211,120			—			—			580,043		(1,920	)		578,123		86,602			491,521			(18,409	)		473,112		$	0.235		$	0.233
Stock-based compensation expense		—			(21,704	)		(47,385	)		(74,682	)		—			—			143,771		—			143,771		26,895			116,876			(6,837	)		110,039		$	0.055		$	0.054
Intangible amortization		—			(40,397	)		(4,305	)		(28,260	)		—			—			72,962		—			72,962		26,930			46,032			(480	)		45,552		$	0.023		$	0.022
EMC Consolidated Non-GAAP (2)	$	4,016,638		$	1,728,853		$	382,831		$	1,108,178		$	—		$	—		$	796,776	$	(1,920	)	$	794,856	$	140,427		$	654,429		$	(25,726	)	$	628,703		$	0.312		$	0.310
EMC Information Infrastructure GAAP	$	3,502,307		$	1,719,162		$	331,166		$	982,832		$	—		$	240,694		$	228,453	$	(5,703	)	$	222,750	$	41,639		$	181,111		$	—		$	181,111		$	0.090		$	0.089
Restructuring charge		—			—			—			—			—			(240,694	)		240,694		6,877			247,571		48,037			199,534			—			199,534		$	0.099		$	0.098
EMC Information Infrastructure Adjusted (3)		3,502,307			1,719,162			331,166			982,832			—			—			469,147		1,174			470,321		89,676			380,645			—			380,645		$	0.189		$	0.188
Stock-based compensation expense		—			(16,665	)		(25,274	)		(52,885	)		—			—			94,824		—			94,824		20,958			73,866			—			73,866		$	0.037		$	0.036
Intangible amortization		—			(37,253	)		(4,305	)		(26,705	)		—			—			68,263		—			68,263		25,248			43,015			—			43,015		$	0.021		$	0.021
EMC Information Infrastructure Non-GAAP (4)	$	3,502,307		$	1,665,244		$	301,587		$	903,242		$	—		$	—		$	632,234	$	1,174		$	633,408	$	135,882		$	497,526		$	—		$	497,526		$	0.247		$	0.245
VMware standalone GAAP	$	514,603		$	71,950		$	110,506		$	230,033		$	—		$	—		$	102,114	$	(1,490	)	$	100,624	$	(10,830	)	$	111,454		$	—		$	111,454		$	0.055		$	0.055
GAAP adjustments and eliminations		(272	)		(158	)		(7,151	)		(1,745	)		6,576			—			2,206		(1,604	)		602		5,527			(4,925	)		(17,718	)		(22,643	)	$	(0.011	)	$	(0.011	)
VMware within EMC GAAP (5)		514,331			71,792			103,355			228,288			6,576			—			104,320		(3,094	)		101,226		(5,303	)		106,529			(17,718	)		88,811		$	0.044		$	0.044
IPR&D charge		—			—			—			—			(6,576	)		—			6,576		—			6,576		2,229			4,347			(691	)		3,656		$	0.002		$	0.002
VMware within EMC Adjusted (6)		514,331			71,792			103,355			228,288			—			—			110,896		(3,094	)		107,802		(3,074	)		110,876			(18,409	)		92,467		$	0.046		$	0.045
Stock-based compensation expense		—			(5,039	)		(22,111	)		(21,797	)		—			—			48,947		—			48,947		5,937			43,010			(6,837	)		36,173		$	0.018		$	0.018
Intangible amortization		—			(3,144	)		—			(1,555	)		—			—			4,699		—			4,699		1,682			3,017			(480	)		2,537		$	0.001		$	0.001
VMware within EMC Non-GAAP (7)	$	514,331		$	63,609		$	81,244		$	204,936		$	—		$	—		$	164,542	$	(3,094	)	$	161,448	$	4,545		$	156,903		$	(25,726	)	$	131,177		$	0.065		$	0.065
																																	Wtd. Average Share O/S						2,012,389			2,028,635
																																	Incremental VMware dilution								$	268
																																	Minority interest percentage									0.1590

Reconciliation of GAAP to Non-GAAP

For the Three Months Ended December 31, 2008

(in thousands, except per share amounts)

Unaudited

(Continued)

The following costs are included in EMC Consolidated Non-GAAP and EMC Information Infrastructure Non-GAAP results

	Revenue		Cost of Revenue		Research and Development		Selling, General and Administrative		IPR&D Charge		Restructuring Charge		Operating Income		Other Income, net			Income Before Taxes			Income Tax Provision			Net Income			Net Income Attributable to VMware		Net Income Attributable to EMC			Net Income per Weighted Average Share, Basic			Net Income per Weighted Average Share, Diluted
Non-cash interest expense on convertible debt (8)	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	(26,295	)	$	(26,295	)	$	(8,233	)	$	(18,062	)	$	—	$	(18,062	)	$	(0.009	)	$	(0.009	)

(1) Represents EMC Consolidated GAAP excluding restructuring charge and IPR&D charge.

(2) Represents EMC Consolidated Adjusted excluding stock-based compensation expense and intangible amortization.

(3) Represents EMC Information Infrastructure GAAP excluding restructuring charge.

(4) Represents EMC Information Infrastructure Adjusted less stock-based compensation expense and intangible amortization.

(5) Represents VMware within EMC GAAP.

(6) Represents VMware within EMC GAAP excluding IPR&D charge.

(7) Represents VMware within EMC Adjusted excluding stock-based compensation expense and intangible amortization.

(8) Represents the non-cash interest charge associated with our convertible senior notes due 2011 and 2013 totaling $3,450 million.

Note: schedule may not add due to rounding

Reconciliation of GAAP to Non-GAAP

For the Twelve Months Ended December 31, 2009

(in thousands, except per share amounts)

Unaudited

	Revenue			Cost of Revenue			Research and Development			Selling, General and Administrative			Restructuring and Acquisition- Related Charges			Operating Income		Other Income (Expense), net			Income Before Taxes			Income Tax Provision			Net Income			Net Income Attributable to VMware			Net Income Attributable to EMC			Net Income per Weighted Average Share, Basic			Net Income per Weighted Average Share, Diluted
EMC Consolidated GAAP	$	14,025,910		$	6,281,011		$	1,627,509		$	4,538,125		$	107,490		$	1,471,775	$	(39,699	)	$	1,432,076		$	274,381		$	1,157,695		$	(33,724	)	$	1,123,971		$	0.556		$	0.546
Gain on Data Domain and SpringSource common stock		—			—			—			—			—			—		(25,822	)		(25,822	)		—			(25,822	)		1,025			(24,797	)	$	(0.012	)	$	(0.012	)
Restructuring and acquisition-related charges		—			(12,485	)		—			—			(107,490	)		119,975		—			119,975			35,884			84,091			(287	)		83,804		$	0.041		$	0.041
Special income tax charge		—			—			—			—			—			—		—			—			(77,168	)		77,168			—			77,168		$	0.038		$	0.038
EMC Consolidated Adjusted (1)		14,025,910			6,268,526			1,627,509			4,538,125			—			1,591,750		(65,521	)		1,526,229			233,097			1,293,132			(32,986	)		1,260,146		$	0.623		$	0.612
Stock-based compensation expense		—			(99,393	)		(214,554	)		(291,759	)		—			605,706		—			605,706			135,130			470,576			(34,731	)		435,845		$	0.216		$	0.212
Intangible amortization		—			(131,754	)		(12,883	)		(103,151	)		—			247,788		—			247,788			83,842			163,946			(1,568	)		162,378		$	0.080		$	0.079
EMC Consolidated Non-GAAP (2)	$	14,025,910		$	6,037,379		$	1,400,072		$	4,143,215		$	—		$	2,445,244	$	(65,521	)	$	2,379,723		$	452,069		$	1,927,654		$	(69,285	)	$	1,858,369		$	0.919		$	0.904
EMC Information Infrastructure GAAP	$	12,004,948		$	5,921,103		$	1,136,100		$	3,600,416		$	105,889		$	1,241,440	$	(36,059	)	$	1,205,381		$	247,405		$	957,976		$	—		$	957,976		$	0.474		$	0.466
Gain on Data Domain common stock		—			—			—			—			—			—		(19,963	)		(19,963	)		—			(19,963	)		—			(19,963	)	$	(0.010	)	$	(0.010	)
Restructuring and acquisition-related charges		—			(12,485	)		—			—			(105,889	)		118,374		—			118,374			35,884			82,490			—			82,490		$	0.041		$	0.040
Special income tax charge		—			—			—			—			—			—		—			—			(77,168	)		77,168			—			77,168		$	0.038		$	0.038
EMC Information Infrastructure Adjusted (3)		12,004,948			5,908,618			1,136,100			3,600,416			—			1,359,814		(56,022	)		1,303,792			206,121			1,097,671			—			1,097,671		$	0.543		$	0.534
Stock-based compensation expense		—			(67,698	)		(92,766	)		(198,239	)		—			358,703		—			358,703			89,055			269,648			—			269,648		$	0.133		$	0.131
Intangible amortization		—			(119,819	)		(12,776	)		(101,059	)		—			233,654		—			233,654			78,824			154,830			—			154,830		$	0.077		$	0.075
EMC Information Infrastructure Non-GAAP (4)	$	12,004,948		$	5,721,101		$	1,030,558		$	3,301,118		$	—		$	1,952,171	$	(56,022	)	$	1,896,149		$	374,000		$	1,522,149		$	—		$	1,522,149		$	0.753		$	0.741
VMware standalone GAAP	$	2,023,937		$	359,728		$	496,552		$	948,362		$	—		$	219,295	$	4,154		$	223,449		$	26,351		$	197,098		$	—		$	197,098		$	0.097		$	0.096
GAAP adjustments and eliminations		(2,975	)		180			(5,143	)		(10,653	)		1,601			11,040		(7,794	)		3,246			625			2,621			(33,724	)		(31,103	)	$	(0.015	)	$	(0.016	)
VMware within EMC GAAP (5)		2,020,962			359,908			491,409			937,709			1,601			230,335		(3,640	)		226,695			26,976			199,719			(33,724	)		165,995		$	0.082		$	0.080
Gain on SpringSource common stock		—			—			—			—			—			—		(5,859	)		(5,859	)		—			(5,859	)		1,025			(4,834	)	$	(0.002	)	$	(0.002	)
Acquisition-related charges		—			—			—			—			(1,601	)		1,601		—			1,601			—			1,601			(287	)		1,314		$	0.001		$	0.001
VMware within EMC Adjusted (6)		2,020,962			359,908			491,409			937,709			—			231,936		(9,499	)		222,437			26,976			195,461			(32,986	)		162,475		$	0.080		$	0.078
Stock-based compensation expense		—			(31,695	)		(121,788	)		(93,520	)		—			247,003		—			247,003			46,075			200,928			(34,731	)		166,197		$	0.082		$	0.081
Intangible amortization		—			(11,935	)		(107	)		(2,092	)		—			14,134		—			14,134			5,018			9,116			(1,568	)		7,548		$	0.004		$	0.004
VMware within EMC Non-GAAP (7)	$	2,020,962		$	316,278		$	369,514		$	842,097		$	—		$	493,073	$	(9,499	)	$	483,574		$	78,069		$	405,505		$	(69,285	)	$	336,220		$	0.166		$	0.163
																												Wtd. Average Share O/S									2,022,371			2,055,146
																												Incremental VMware dilution											$	1,392

Reconciliation of GAAP to Non-GAAP

For the Twelve Months Ended December 31, 2009

(in thousands, except per share amounts)

Unaudited

(Continued)

The following costs are included in EMC Consolidated Non-GAAP and EMC Information Infrastructure Non-GAAP results

	Revenue		Cost of Revenue		Research and Development		Selling, General and Administrative		Restructuring and Acquisition- Related Charges		Operating Income			Other Income (Expense), net			Income Before Taxes			Income Tax Provision			Net Income			Net Income Attributable to VMware		Net Income Attributable to EMC			Net Income per Weighted Average Share, Basic			Net Income per Weighted Average Share, Diluted
Non-cash interest expense on convertible debt (8)	$	—	$	—	$	—	$	—	$	—	$	—		$	(108,347	)	$	(108,347	)	$	(35,025	)	$	(73,322	)	$	—	$	(73,322	)	$	(0.036	)	$	(0.036	)
Transition costs (9)		—		3,194		8,411		43,063		—		(54,668	)		—			(54,668	)		(15,683	)		(38,985	)		—	$	(38,985	)	$	(0.019	)	$	(0.019	)
	$	—	$	3,194	$	8,411	$	43,063	$	—	$	(54,668	)	$	(108,347	)	$	(163,015	)	$	(50,708	)	$	(112,307	)	$	—	$	(112,307	)	$	(0.056	)	$	(0.055	)

(1) Represents EMC Consolidated GAAP excluding gain on Data Domain and SpringSource common stock, restructuring and acquisition-related charges and a special income tax charge.

(2) Represents EMC Consolidated Adjusted excluding stock-based compensation expense and intangible amortization.

(3) Represents EMC Information Infrastructure GAAP excluding gain on Data Domain common stock, restructuring and acquisition-related charges and a special income tax charge.

(4) Represents EMC Information Infrastructure Adjusted excluding stock-based compensation expense and intangible amortization.

(5) Represents VMware within EMC GAAP.

(6) Represents VMware within EMC GAAP excluding gain on SpringSource common stock and acquisition-related charges.

(7) Represents VMware within EMC Adjusted excluding stock-based compensation expense and intangible amortization.

(8) Represents the non-cash interest charge associated with our convertible senior notes due 2011 and 2013 totaling $3,450 million.

(9) Represents incremental costs incurred to transform our current cost structure to a more streamlined cost structure.

Note: schedule may not add due to rounding

Reconciliation of GAAP to Non-GAAP

For the Twelve Months Ended December 31, 2008

(in thousands, except per share amounts)

Unaudited

	Revenue			Cost of Revenue			Research and Development			Selling, General and Administrative			IPR&D Charge			Restructuring Charge			Operating Income		Other Income, net			Income Before Taxes		Income Tax Provision		Net Income			Net Income Attributable to VMware			Net Income Attributable to EMC			Net Income per Weighted Average Share, Basic			Net Income per Weighted Average Share, Diluted
EMC Consolidated GAAP	$	14,876,163		$	6,653,794		$	1,721,330		$	4,601,588		$	85,780		$	244,735		$	1,568,936	$	31,289		$	1,600,225	$	280,396	$	1,319,829		$	(44,725	)	$	1,275,104		$	0.622		$	0.610
Restructuring charge		—			—			—			—			—			(245,092	)		245,092		6,877			251,969		51,027		200,942			—			200,942		$	0.098		$	0.097
IPR&D charge		—			—			—			—			(85,780	)		—			85,780		—			85,780		2,229		83,551			(691	)		82,860		$	0.040		$	0.040
Special income tax benefit		—			—			—			—			—			—			—		—			—		17,803		(17,803	)		—			(17,803	)	$	(0.009	)	$	(0.009	)
EMC Consolidated Adjusted (1)		14,876,163			6,653,794			1,721,330			4,601,588			—			(357	)		1,899,808		38,166			1,937,974		351,455		1,586,519			(45,416	)		1,541,103		$	0.752		$	0.737
Stock-based compensation expense		—			(80,126	)		(162,377	)		(258,936	)		—			—			501,439		—			501,439		108,811		392,628			(21,412	)		371,216		$	0.181		$	0.178
Intangible amortization		—			(158,600	)		(12,986	)		(108,222	)		—			—			279,808		—			279,808		97,233		182,575			(1,704	)		180,871		$	0.088		$	0.087
EMC Consolidated Non-GAAP (2)	$	14,876,163		$	6,415,068		$	1,545,967		$	4,234,430		$	—		$	(357	)	$	2,681,055	$	38,166		$	2,719,221	$	557,499	$	2,161,722		$	(68,532	)	$	2,093,190		$	1.022		$	1.003
EMC Information Infrastructure GAAP	$	12,999,227		$	6,350,213		$	1,300,715		$	3,773,900		$	79,204		$	244,735		$	1,250,460	$	26,937		$	1,277,397	$	245,048	$	1,032,349		$	—		$	1,032,349		$	0.504		$	0.496
Restructuring charge		—			—			—			—			—			(245,092	)		245,092		6,877			251,969		51,027		200,942			—			200,942		$	0.098		$	0.097
IPR&D charge		—			—			—			—			(79,204	)		—			79,204		—			79,204		—		79,204			—			79,204		$	0.039		$	0.038
Special income tax benefit		—			—			—			—			—			—			—		—			—		17,803		(17,803	)		—			(17,803	)	$	(0.009	)	$	(0.009	)
EMC Information Infrastructure Adjusted (3)		12,999,227			6,350,213			1,300,715			3,773,900			—			(357	)		1,574,756		33,814			1,608,570		313,878		1,294,692			—			1,294,692		$	0.632		$	0.622
Stock-based compensation expense		—			(56,538	)		(84,001	)		(185,018	)		—			—			325,557		—			325,557		73,932		251,625			—			251,625		$	0.123		$	0.121
Intangible amortization		—			(147,323	)		(12,986	)		(102,035	)		—			—			262,344		—			262,344		90,945		171,399			—			171,399		$	0.084		$	0.082
EMC Information Infrastructure Non-GAAP (4)	$	12,999,227		$	6,146,352		$	1,203,728		$	3,486,847		$	—		$	(357	)	$	2,162,657	$	33,814		$	2,196,471	$	478,755	$	1,717,716		$	—		$	1,717,716		$	0.839		$	0.826
VMware standalone GAAP	$	1,881,027		$	304,105		$	429,204		$	835,193		$	—		$	—		$	312,525	$	6,760		$	319,285	$	29,152	$	290,133		$	—		$	290,133		$	0.142		$	0.139
GAAP adjustments and eliminations		(4,091	)		(524	)		(8,589	)		(7,505	)		6,576			—			5,951		(2,408	)		3,543		6,196		(2,653	)		(44,725	)		(47,378	)	$	(0.023	)	$	(0.026	)
VMware within EMC GAAP (5)		1,876,936			303,581			420,615			827,688			6,576			—			318,476		4,352			322,828		35,348		287,480			(44,725	)		242,755		$	0.119		$	0.113
IPR&D charge		—			—			—			—			(6,576	)		—			6,576		—			6,576		2,229		4,347			(691	)		3,656		$	0.002		$	0.002
VMware within EMC Adjusted (6)		1,876,936			303,581			420,615			827,688			—			—			325,052		4,352			329,404		37,577		291,827			(45,416	)		246,411		$	0.120		$	0.115
Stock-based compensation expense		—			(23,588	)		(78,376	)		(73,918	)		—			—			175,882		—			175,882		34,879		141,003			(21,412	)		119,591		$	0.058		$	0.057
Intangible amortization		—			(11,277	)		—			(6,187	)		—			—			17,464		—			17,464		6,288		11,176			(1,704	)		9,472		$	0.005		$	0.005
VMware within EMC Non-GAAP (7)	$	1,876,936		$	268,716		$	342,239		$	747,583		$	—		$	—		$	518,398	$	4,352		$	522,750	$	78,744	$	444,006		$	(68,532	)	$	375,474		$	0.183		$	0.177
																													Wtd. Average Share O/S									2,048,506			2,079,853
																													Incremental VMware dilution											$	7,428

Reconciliation of GAAP to Non-GAAP

For the Twelve Months Ended December 31, 2008

(in thousands, except per share amounts)

Unaudited

(Continued)

The following costs are included in EMC Consolidated Non-GAAP and EMC Information Infrastructure Non-GAAP results

	Revenue		Cost of Revenue		Research and Development		Selling, General and Administrative		IPR&D Charge		Restructuring Charge		Operating Income		Other Income, net			Income Before Taxes			Income Tax Provision			Net Income			Net Income Attributable to VMware		Net Income Attributable to EMC			Net Income per Weighted Average Share, Basic			Net Income per Weighted Average Share, Diluted
Non-cash interest expense on convertible debt (8)	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	(102,581	)	$	(102,581	)	$	(32,118	)	$	(70,463	)	$	—	$	(70,463	)	$	(0.034	)	$	(0.034	)

(1) Represents EMC Consolidated GAAP excluding restructuring charge, IPR&D charge and special income tax benefit.

(2) Represents EMC Consolidated Adjusted excluding stock-based compensation expense and intangible amortization.

(3) Represents EMC Information Infrastructure GAAP excluding restructuring charge, IPR&D charge and special income tax benefit.

(4) Represents EMC Information Infrastructure Adjusted less stock-based compensation expense and intangible amortization.

(5) Represents VMware within EMC GAAP.

(6) Represents VMware within EMC GAAP excluding IPR&D charge.

(7) Represents VMware within EMC Adjusted excluding stock-based compensation expense and intangible amortization.

(8) Represents the non-cash interest charge associated with our convertible senior notes due 2011 and 2013 totaling $3,450 million.

Note: schedule may not add due to rounding

EMC CORPORATION

Consolidated Balance Sheets

(in thousands, except per share amounts)

Unaudited

	December 31, 2009			December 31, 2008
				(As Adjusted)
ASSETS
Current assets:
Cash and cash equivalents	$	6,302,499		$	5,843,685
Short-term investments		392,839			963,292
Accounts and notes receivable, less allowance for doubtful accounts of $47,414 and $48,080		2,108,575			2,252,640
Inventories		886,289			842,803
Deferred income taxes		559,018			477,101
Other current assets		283,926			285,508
Total current assets		10,533,146			10,665,029
Long-term investments		2,692,323			2,370,493
Property, plant and equipment, net		2,224,346			2,223,007
Intangible assets, net		1,185,632			795,616
Goodwill, net		9,210,376			7,046,799
Other assets, net		961,024			773,631
Total assets	$	26,806,847		$	23,874,575
LIABILITIES & SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	899,298		$	757,405
Accrued expenses		1,886,710			1,901,884
Securities lending payable		—			412,321
Income taxes payable		58,141			136,802
Deferred revenue		2,262,968			2,010,024
Total current liabilities		5,107,117			5,218,436
Income taxes payable		235,976			255,182
Deferred revenue		1,373,798			1,182,360
Deferred income taxes		708,378			389,787
Long-term convertible debt		3,100,290			2,991,943
Other liabilities		184,920			180,917
Total liabilities		10,710,479			10,218,625
Commitments and contingencies
EMC Corporation’s Shareholders’ equity:
Preferred stock, par value $.01; authorized 25,000 shares, none outstanding		—			—
Common stock, par value $.01; authorized 6,000,000 shares; issued 2,052,441 and 2,012,938 shares		20,524			20,129
Additional paid-in capital		3,874,952			2,817,054
Retained earnings		11,795,183			10,671,212
Accumulated other comprehensive loss		(104,883	)		(179,952	)
Total EMC Corporation’s shareholders’ equity		15,585,776			13,328,443
Non-controlling interest in VMware, Inc.		510,592			327,507
Total shareholders’ equity		16,096,368			13,655,950
Total liabilities and shareholders’ equity	$	26,806,847		$	23,874,575

EMC CORPORATION

Consolidated Statements of Cash Flows

(in thousands)

Unaudited

	Twelve Months Ended
	December 31, 2009			December 31, 2008
				(As Adjusted)
Cash flows from operating activities:
Cash received from customers	$	14,647,691		$	15,378,081
Cash paid to suppliers and employees		(11,032,859	)		(11,747,031	)
Dividends and interest received		109,525			240,031
Interest paid		(73,430	)		(73,695	)
Income taxes paid		(316,542	)		(232,298	)
Net cash provided by operating activities		3,334,385			3,565,088
Cash flows from investing activities:
Additions to property, plant and equipment		(411,579	)		(695,899	)
Capitalized software development costs		(304,520	)		(294,973	)
Purchases of short and long-term available for sale securities		(5,409,540	)		(3,318,545	)
Sales of short and long-term available for sale securities		5,171,449			3,189,547
Maturities of short and long-term available for sale securities		704,653			204,091
Acquisitions, net of cash acquired		(2,664,141	)		(725,521	)
Increase in strategic and other related investments		(182,994	)		(5,510	)
Other		1,184			31,878
Net cash used in investing activities		(3,095,488	)		(1,614,932	)
Cash flows from financing activities:
Issuance of EMC’s common stock from the exercise of stock options		366,361			241,060
Issuance of VMware’s common stock from the exercise of stock options		227,666			190,107
Purchase of VMware’s common stock		—			(13,259	)
(Repayments on) proceeds from securities lending		(412,321	)		412,321
Repurchase of EMC’s common stock		—			(1,489,501	)
Excess tax benefits from stock-based compensation		46,082			97,705
Payment of short and long-term obligations		(20,835	)		(6,151	)
Proceeds from short and long-term obligations		4,969			33,707
Net cash provided by (used in) financing activities		211,922			(534,011	)
Effect of exchange rate changes on cash		7,995			(54,671	)
Net increase in cash and cash equivalents		458,814			1,361,474
Cash and cash equivalents at beginning of period		5,843,685			4,482,211
Cash and cash equivalents at end of period	$	6,302,499		$	5,843,685
Reconciliation of net income to net cash provided by operating activities:
Net income	$	1,157,695		$	1,319,829
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		1,073,135			1,057,511
Non-cash interest expense on convertible debt		108,347			102,581
Non-cash restructuring and in-process research and development		25,050			139,193
Stock-based compensation expense		600,537			501,439
Increase in provision for doubtful accounts		14,351			34,667
Deferred income taxes, net		32,354			4,629
Excess tax benefits from stock-based compensation		(46,082	)		(97,705	)
Gain on Data Domain and SpringSource common stock		(25,822	)		—
Other		(13,906	)		(13,471	)
Changes in assets and liabilities, net of acquisitions:
Accounts and notes receivable		241,069			73,184
Inventories		(158,482	)		165,813
Other assets		3,600			(16,178	)
Accounts payable		140,376			(148,821	)
Accrued expenses		(138,142	)		8,688
Income taxes payable		(74,692	)		44,821
Deferred revenue		366,361			394,067
Other liabilities		28,636			(5,159	)
Net cash provided by operating activities	$	3,334,385		$	3,565,088

EMC Corporation

Reconciliation of Cash Flow from Operations to Free Cash Flow

(in thousands)

Unaudited

	Three Months Ended						Twelve Months Ended
	December 31, 2009			December 31, 2008			December 31, 2009			December 31, 2008
EMC Consolidated
Cash flow from Operations	$	1,008,657		$	1,066,746		$	3,334,385		$	3,565,088
Capital Expenditures		(133,990	)		(205,833	)		(411,579	)		(695,899	)
Capitalized Software		(82,088	)		(85,532	)		(304,520	)		(294,973	)
Free Cash Flow	$	792,579		$	775,381		$	2,618,286		$	2,574,216
VMware within EMC
Cash flow from Operations	$	278,316		$	264,331		$	941,126		$	735,632
Capital Expenditures		(24,248	)		(58,011	)		(90,352	)		(176,396	)
Capitalized Software		(15,087	)		(37,005	)		(68,611	)		(90,900	)
Free Cash Flow	$	238,981		$	169,315		$	782,163		$	468,336
EMC Information Infrastructure
Cash flow from Operations	$	730,341		$	802,415		$	2,393,259		$	2,829,456
Capital Expenditures		(109,742	)		(147,822	)		(321,227	)		(519,503	)
Capitalized Software		(67,001	)		(48,527	)		(235,909	)		(204,073	)
Free Cash Flow	$	553,598		$	606,066		$	1,836,123		$	2,105,880

Free cash flow for the twelve months ended December 31, 2009 includes intercompany tax payments of $93.4 million from EMC Information Infrastructure to VMware within EMC.

EMC Corporation

Reconciliation of GAAP to Non-GAAP Tax Rate

(in thousands)

Unaudited

For the three months ended December 31, 2009
	Income Before Tax			Tax Provision			Tax Rate
EMC Consolidated GAAP	$	614,785		$	177,919		29	%
Stock-based compensation expense		181,597			36,849		20	%
Intangible asset amortization		65,903			21,444		33	%
Restructuring and acquisition-related charges		23,903			9,130		38	%
Special income tax charge		—			(77,168	)	NA
EMC Consolidated Non-GAAP	$	886,188		$	168,174		19	%
For the year ended December 31, 2009
	Income Before Tax			Tax Provision			Tax Rate
EMC Consolidated GAAP	$	1,432,076		$	274,381		19	%
Stock-based compensation expense		605,706			135,130		22	%
Intangible asset amortization		247,788			83,842		34	%
Gain on Data Domain and SpringSource common stock		(25,822	)		—		0	%
Restructuring and acquisition-related charges		119,975			35,884		30	%
Special income tax charge		—			(77,168	)	NA
EMC Consolidated Non-GAAP	$	2,379,723		$	452,069		19	%

EMC Corporation

Reconciliation of EMC Information Infrastructure Gross Margin GAAP to Non-GAAP

(in thousands)

Unaudited

	Q1 ’08			Q2 ’08			Q3 ’08			Q4 ’08			Q1 ’09			Q2 ’09			Q3 ’09			Q4 ’09
EMC Information Infrastructure Gross Margin GAAP	$	1,548,285		$	1,656,440		$	1,661,144		$	1,783,145		$	1,287,536		$	1,369,676		$	1,547,240		$	1,879,392
Less: Stock-based compensation expense		12,136			12,486			15,251			16,665			14,233			15,224			17,608			20,633
Intangible asset amortization		35,888			36,974			37,208			37,253			27,853			27,778			31,228			32,960
Restructuring-related charges		—			—			—			—			—			—			12,485			—
EMC Information Infrastructure Gross Margin Non-GAAP	$	1,596,309		$	1,705,900		$	1,713,603		$	1,837,063		$	1,329,622		$	1,412,678		$	1,608,561		$	1,932,985
Revenues	$	3,031,889		$	3,221,299		$	3,243,732		$	3,502,307		$	2,680,361		$	2,802,239		$	3,028,725		$	3,493,623
% GAAP		51.1	%		51.4	%		51.2	%		50.9	%		48.0	%		48.9	%		51.1	%		53.8	%
% Non-GAAP		52.7	%		53.0	%		52.8	%		52.5	%		49.6	%		50.4	%		53.1	%		55.3	%

EMC Corporation

Reconciliation of EMC Information Infrastructure Operating Margin GAAP to Non-GAAP

(in thousands)

Unaudited

	Q1 ’08			Q2 ’08			Q3 ’08			Q4 ’08			Q1 ’09			Q2 ’09			Q3 ’09			Q4 ’09
EMC Information Infrastructure Operating Margin GAAP	$	263,370		$	391,523		$	367,114		$	228,453		$	170,216		$	220,545		$	278,880		$	571,798
Less: Restructuring and acquisition-related charges		79,204			—			4,398			240,694			15,572			33,234			46,493			23,075
Stock-based compensation expense		74,460			75,424			80,849			94,824			60,949			67,156			122,061			108,537
Intangible asset amortization		62,149			65,038			66,894			68,263			55,879			56,143			59,838			61,794
EMC Information Infrastructure Operating Margin Non-GAAP	$	479,183		$	531,985		$	519,255		$	632,234		$	302,616		$	377,078		$	507,272		$	765,204
Revenues	$	3,031,889		$	3,221,299		$	3,243,732		$	3,502,307		$	2,680,361		$	2,802,239		$	3,028,725		$	3,493,623
% GAAP		8.7	%		12.2	%		11.3	%		6.5	%		6.4	%		7.9	%		9.2	%		16.4	%
% Non-GAAP		15.8	%		16.5	%		16.0	%		18.1	%		11.3	%		13.5	%		16.7	%		21.9	%

14

EMC Corporation

Supplemental

Revenue Analysis

(in thousands)

Unaudited

Supplemental Revenue Data

	Q1 2008			Q2 2008			Q3 2008			Q4 2008			YTD 2008			Q1 2009			Q2 2009			Q3 2009			Q4 2009			YTD 2009
Storage:
Product Revenue	$	1,903,639		$	2,018,026		$	2,056,498		$	2,285,366		$	8,263,529		$	1,572,408		$	1,632,309		$	1,818,230		$	2,175,104		$	7,198,051
Services Revenue		808,190			855,221			851,825			853,539			3,368,775			790,932			842,558			880,807			947,061			3,461,358
Total Storage Revenue	$	2,711,829		$	2,873,247		$	2,908,323		$	3,138,905		$	11,632,304		$	2,363,340		$	2,474,867		$	2,699,037		$	3,122,165		$	10,659,409
Content Management and Archiving:
Product Revenue	$	61,128		$	73,415		$	62,576		$	81,054		$	278,173		$	58,710		$	60,792		$	58,209		$	83,125		$	260,836
Services Revenue		124,075			130,591			125,493			127,316			507,475			115,605			119,445			118,979			124,724			478,753
Total Content Management and Archiving Revenue	$	185,203		$	204,006		$	188,069		$	208,370		$	785,648		$	174,315		$	180,237		$	177,188		$	207,849		$	739,589
Security:
Product Revenue	$	81,683		$	89,067		$	88,779		$	95,534		$	355,063		$	80,671		$	84,080		$	84,080		$	91,441		$	340,272
Services Revenue		53,174			54,979			58,561			59,498			226,212			62,035			63,055			68,420			72,168			265,678
Total Security Revenue	$	134,857		$	144,046		$	147,340		$	155,032		$	581,275		$	142,706		$	147,135		$	152,500		$	163,609		$	605,950
EMC Information Infrastructure:
Product Revenue	$	2,046,450		$	2,180,508		$	2,207,853		$	2,461,954		$	8,896,765		$	1,711,789		$	1,777,181		$	1,960,519		$	2,349,670		$	7,799,159
Services Revenue		985,439			1,040,791			1,035,879			1,040,353			4,102,462			968,572			1,025,058			1,068,206			1,143,953			4,205,789
Total EMC Information Infrastructure Revenue	$	3,031,889		$	3,221,299		$	3,243,732		$	3,502,307		$	12,999,227		$	2,680,361		$	2,802,239		$	3,028,725		$	3,493,623		$	12,004,948
VMware:
Product Revenue	$	293,980		$	281,143		$	285,088		$	314,840		$	1,175,051		$	257,331		$	228,089		$	240,062		$	303,504		$	1,028,986
Services Revenue		144,190			171,432			186,772			199,491			701,885			213,070			227,024			248,843			303,039			991,976
Total VMware Revenue	$	438,170		$	452,575		$	471,860		$	514,331		$	1,876,936		$	470,401		$	455,113		$	488,905		$	606,543		$	2,020,962
Consolidated Revenues
Product Revenue	$	2,340,430		$	2,461,651		$	2,492,941		$	2,776,794		$	10,071,816		$	1,969,120		$	2,005,270		$	2,200,581		$	2,653,174		$	8,828,145
Services Revenue		1,129,629			1,212,223			1,222,651			1,239,844			4,804,347			1,181,642			1,252,082			1,317,049			1,446,992			5,197,765
Total Consolidated Revenues	$	3,470,059		$	3,673,874		$	3,715,592		$	4,016,638		$	14,876,163		$	3,150,762		$	3,257,352		$	3,517,630		$	4,100,166		$	14,025,910
Percentage impact to EMC revenue growth rate due to changes in exchange rates from the prior year		2.3	%		2.7	%		1.2	%		(2.3	)%		0.8	%		(3.5	)%		(3.7	)%		(1.3	)%		2.5	%		(1.4	)%

15

EMC Corporation

Constant Currency Revenue Analysis

(in thousands)

Unaudited

Consolidated Revenue	Q4-09 vs. Q4-08
Revenue growth—GAAP	2.1	%
Impact of constant currency	-2.5	%
Revenue growth on a constant currency basis	-0.4	%
BRIC + 13 Revenue	Q4-09 vs. Q4-08
Revenue growth—GAAP	5.5	%
Impact of constant currency	-4.3	%
Revenue growth on a constant currency basis	1.2	%

This presentation refers to growth rates at constant currency or adjusting for currency so that business results can be viewed without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons of EMC’s business performance. To present this information, current period results for entities reporting in currencies other than US dollars are converted into US dollars at the exchange rate applied in each month of the prior year quarter. Constant currency includes the impacts from EMC’s hedging program.

16