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): July 21, 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 July 21, 2010, EMC Corporation (“EMC”) issued a press release announcing financial results for the quarter ended June 30, 2010. 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 July 21, 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: July 21, 2010

3

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press release of EMC Corporation dated July 21, 2010

EX-99.1

Exhibit 99.1

Contact:  Dave Farmer

                508-293-7206

                farmer_dave@emc.com

EMC REPORTS RECORD SECOND-QUARTER REVENUE; QUARTERLY PROFIT MORE THAN DOUBLES

Second-Quarter Highlights

• Record second-quarter consolidated revenue up 24% year over year

• GAAP net income up 108% year over year

• Record second-quarter non-GAAP net income up 66% year over year

• All-time record year-to-date operating cash flow and free cash flow

• Strong year-over-year increase in gross and operating margins

HOPKINTON, Mass. – July 21, 2010 – EMC Corporation (NYSE:EMC), the world leader in information infrastructure solutions, today reported record financial results for the second quarter of 2010. Consistently strong execution across the business and healthy customer demand across all geographies contributed to EMC achieving its third consecutive quarter of record revenue and reporting net income that more than doubled on a year-over-year basis.

For the second quarter, consolidated revenue was $4.02 billion, an increase of 24% compared with the year-ago quarter; GAAP net income attributable to EMC increased 108% year over year to $426 million; and GAAP diluted earnings per share were $0.20, up 100% year over year. Non-GAAP¹ net income attributable to EMC for the second quarter was $596 million, an increase of 66% compared with the year-ago quarter, and non-GAAP¹ earnings per diluted share were $0.28, an increase of 56% year over year.

During the quarter, EMC expanded gross and operating margins substantially on a year-over-year basis. The company achieved all-time record year-to-date operating cash flow and free cash flow of $2.1 billion and $1.6 billion, which grew 44% and 47%, respectively, compared with the year-ago period. The company completed the quarter with $10.3 billion in cash and investments.

Joe Tucci, EMC Chairman and Chief Executive Officer, said, “The strength and demand that we saw during the quarter is testament to the value our customers see in our information infrastructure and virtual infrastructure solutions and the massive opportunity before us. The IT industry is in the midst of a major transformation to cloud computing and, ultimately, to a more agile way to consume and deliver IT. Never in our history have we had a stronger team, more compelling vision, or more innovative set of technologies, services, and partnerships. As a result, EMC is in an excellent position to lead this dramatic shift in IT and provide our customers with a clear path forward on their journey to the cloud.”

David Goulden, EMC Executive Vice President and Chief Financial Officer, said, “For the second consecutive quarter, EMC once again turned a ‘triple play’ by gaining market share while investing for the future and increasing profitability. With this, we also expanded gross and operating margins and generated all-time record year-to-date operating and free cash flow. Moving forward, we remain confident that we have the right business and operating model to continue delivering annual double-digit revenue and earnings growth over the long term.”

Second-Quarter Highlights

Second-quarter revenue highlights included strong customer demand and double-digit revenue growth for the market-leading high-end EMC Symmetrix storage product portfolio, which increased 32% compared with the year-ago quarter, and EMC’s mid-tier storage product portfolio², which grew revenue 33% year over year. Within EMC’s fast-growing Backup and Recovery Systems Division (BRS), the combined second-quarter revenue run rate for EMC Data Domain and Avamar backup solutions exceeded the billion-dollar revenue run rate the company reported in the first quarter of 2010. VMware (NYSE: VMW), which is majority-owned by EMC, contributed second-quarter revenue of $673 million, increasing 48% compared with the year-ago quarter. Additional second-quarter highlights included strong customer demand for EMC’s RSA information security solutions, which grew revenue 18% year over year, and the company’s broad portfolio of consulting and professional services.

EMC consolidated second-quarter revenue from the United States reached $2.1 billion, an increase of 28% year over year, representing 53% of consolidated second-quarter revenue. Revenue from EMC’s business operations outside of the United States reached $1.9 billion, an increase of 19% year over year, representing 47% of consolidated second-quarter revenue. Within this, revenue increased 18%, 20% and 22% year over year, respectively, in EMC’s Europe, Middle East and Africa (EMEA); Asia Pacific and Japan (APJ); and Latin America regions.

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.

The following statements regarding 2010 financial results have been revised from the statements disclosed by EMC on April 21, 2010:

• For 2010, EMC expects to exceed its previous outlook of $16.5 billion in revenue, $0.84 in consolidated GAAP diluted earnings per share, and $1.18 in consolidated non-GAAP diluted earnings per share, which excludes the impact of restructuring and acquisition-related charges, stock-based compensation expense, and intangible asset amortization.

• For 2010, consolidated restructuring and acquisition-related charges, stock-based compensation expense, and intangible asset amortization are expected to be $0.02, $0.23 and $0.09 per diluted share, respectively.

• 2010 GAAP and non-GAAP research and development (“R&D”) expense is expected to increase between 18% and 19% over 2009. Excluded from the increase in non-GAAP R&D expense is stock-based compensation expense of $46 million and intangible asset amortization of $10 million.

• GAAP operating income is expected to be 14% to 15% of revenues for 2010, and non-GAAP operating income is expected to be 20% to 21% 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%, 4% and less than 2% of revenues, respectively.

• The consolidated GAAP income tax rate is expected to be 19% 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 2%, the consolidated non-GAAP income tax rate is expected to be 21% for 2010. The expected annual GAAP and non-GAAP income tax rates assume that the U.S. research and development tax credit will be re-enacted in 2010.

The following statements regarding 2010 financial results remain unchanged from the statements disclosed by EMC on April 21, 2010:

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

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

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

Supporting Resources

• EMC will host its second-quarter 2010 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 second-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.

#     #     #

¹ Items excluded from the non-GAAP results are restructuring and acquisition-related charges, stock-based compensation expense and intangible amortization for the second quarter of 2010, and restructuring and other special charges, stock-based compensation expense and intangible amortization for the second quarter of 2009. See attached schedules for reconciliation of GAAP to non-GAAP.

² Mid-tier platform products include hardware and software products from EMC CLARiiON, EMC Celerra, EMC Centera, EMC Data Domain, EMC Avamar and EMC Atmos.

EMC, Atmos, Avamar, Celerra, Centera, CLARiiON, Data Domain, RSA and Symmetrix are either registered trademarks or trademarks of EMC Corporation in the United States and/or other countries. VMware is a registered trademark or trademark of VMware, Inc. in the United States and/or other countries. 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; and (xiv) 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 restructuring and acquisition-related charges, stock-based compensation expense, intangible amortization, and restructuring and other special charges) 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.

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						Six Months Ended
	June 30, 2010			June 30, 2009			June 30, 2010			June 30, 2009
Revenues:
Product sales	$	2,553,316		$	2,005,270		$	5,032,033		$	3,974,390
Services		1,470,181			1,252,082			2,882,156			2,433,724
		4,023,497			3,257,352			7,914,189			6,408,114
Cost and expenses:
Cost of product sales		1,157,742			1,057,205			2,319,664			2,070,535
Cost of services		506,556			456,369			1,016,807			910,546
Research and development		477,725			397,881			912,658			781,174
Selling, general and administrative		1,283,651			1,051,204			2,544,935			2,075,977
Restructuring and acquisition-related charges		9,839			33,234			28,341			48,806
Operating income		587,984			261,459			1,091,784			521,076
Non-operating income (expense):
Investment income		32,103			31,343			63,635			71,187
Interest expense		(44,744	)		(44,158	)		(87,712	)		(89,701	)
Other income (expense), net		2,130			17			(6,891	)		(10,741	)
Total non-operating expense		(10,511	)		(12,798	)		(30,968	)		(29,255	)
Income before provision for income taxes		577,473			248,661			1,060,816			491,821
Income tax provision		136,976			38,045			232,629			75,860
Net income		440,497			210,616			828,187			415,961
Less: Net income attributable to the non-controlling interest in VMware, Inc.		(14,281	)		(5,384	)		(29,267	)		(16,660	)
Net income attributable to EMC Corporation	$	426,216		$	205,232		$	798,920		$	399,301
Net income per weighted average share, basic attributable to EMC Corporation common shareholders	$	0.21		$	0.10		$	0.39		$	0.20
Net income per weighted average share, diluted attributable to EMC Corporation common shareholders	$	0.20		$	0.10		$	0.37		$	0.20
Weighted average shares, basic		2,052,161			2,011,508			2,051,599			2,010,147
Weighted average shares, diluted		2,132,997			2,030,048			2,126,062			2,025,433

Reconciliation of GAAP to Non-GAAP

For the Three Months Ended June 30, 2010

(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) 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	$	4,023,497		$	1,664,298		$	477,725		$	1,283,651		$	9,839		$	587,984	$	(10,511	)	$	577,473	$	136,976		$	440,497		$	(14,281	)	$	426,216		$	0.208		$	0.199
Restructuring and acquisition-related charges		—			—			—			—			(9,839	)		9,839		—			9,839		(1,700	)		11,539			(1,167	)		10,372		$	0.005		$	0.005
EMC Consolidated Adjusted (1)		4,023,497			1,664,298			477,725			1,283,651			—			597,823		(10,511	)		587,312		135,276			452,036			(15,448	)		436,588		$	0.213		$	0.204
Stock-based compensation expense		—			(25,085	)		(61,349	)		(74,989	)		—			161,423		298			161,721		38,869			122,852			(11,026	)		111,826		$	0.054		$	0.052
Intangible amortization		—			(34,016	)		(6,252	)		(31,695	)		—			71,963		—			71,963		22,882			49,081			(1,239	)		47,842		$	0.023		$	0.022
EMC Consolidated Non-GAAP (2)	$	4,023,497		$	1,605,197		$	410,124		$	1,176,967		$	—		$	831,209	$	(10,213	)	$	820,996	$	197,027		$	623,969		$	(27,713	)	$	596,256		$	0.291		$	0.279
EMC Information Infrastructure GAAP	$	3,350,692		$	1,546,238		$	317,547		$	993,317		$	8,939		$	484,651	$	(5,507	)	$	479,144	$	111,658		$	367,486		$	—		$	367,486		$	0.179		$	0.172
Restructuring and acquisition-related charges		—			—			—			—			(8,939	)		8,939		—			8,939		3,490			5,449			—			5,449		$	0.003		$	0.003
EMC Information Infrastructure Adjusted (3)		3,350,692			1,546,238			317,547			993,317			—			493,590		(5,507	)		488,083		115,148			372,935			—			372,935		$	0.182		$	0.175
Stock-based compensation expense		—			(16,622	)		(22,037	)		(51,045	)		—			89,704		224			89,928		24,621			65,307			—			65,307		$	0.032		$	0.031
Intangible amortization		—			(26,934	)		(5,625	)		(31,059	)		—			63,618		—			63,618		21,003			42,615			—			42,615		$	0.021		$	0.020
EMC Information Infrastructure Non-GAAP (4)	$	3,350,692		$	1,502,682		$	289,885		$	911,213		$	—		$	646,912	$	(5,283	)	$	641,629	$	160,772		$	480,857		$	—		$	480,857		$	0.234		$	0.225
VMware standalone GAAP	$	673,904		$	118,152		$	161,756		$	292,815		$	—		$	101,181	$	(4,237	)	$	96,944	$	22,406		$	74,538		$	—		$	74,538		$	0.036		$	0.035
GAAP adjustments and eliminations		(1,099	)		(92	)		(1,578	)		(2,481	)		900			2,152		(767	)		1,385		2,912			(1,527	)		(14,281	)		(15,808	)	$	(0.008	)	$	(0.008	)
VMware within EMC GAAP (5)		672,805			118,060			160,178			290,334			900			103,333		(5,004	)		98,329		25,318			73,011			(14,281	)		58,730		$	0.029		$	0.027
Acquisition-related charges		—			—			—			—			(900	)		900		—			900		(5,190	)		6,090			(1,167	)		4,923		$	0.002		$	0.002
VMware within EMC Adjusted (6)		672,805			118,060			160,178			290,334			—			104,233		(5,004	)		99,229		20,128			79,101			(15,448	)		63,653		$	0.031		$	0.029
Stock-based compensation expense		—			(8,463	)		(39,312	)		(23,944	)		—			71,719		74			71,793		14,248			57,545			(11,026	)		46,519		$	0.023		$	0.022
Intangible amortization		—			(7,082	)		(627	)		(636	)		—			8,345		—			8,345		1,879			6,466			(1,239	)		5,227		$	0.003		$	0.002
VMware within EMC Non-GAAP (7)	$	672,805		$	102,515		$	120,239		$	265,754		$	—		$	184,297	$	(4,930	)	$	179,367	$	36,255		$	143,112		$	(27,713	)	$	115,399		$	0.056		$	0.053
																														Wtd. Average Share O/S						2,052,161			2,132,997

Reconciliation of GAAP to Non-GAAP

For the Three Months Ended June 30, 2010

(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) 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)	$	—	$	—	$	—	$	—	$	—	$	—		$	(26,252	)	$	(26,252	)	$	(9,703	)	$	(16,549	)	$	—	$	(16,549	)	$	(0.008	)	$	(0.008	)
Transition costs (9)		—		559		1,311		8,708		—		(10,578	)		—			(10,578	)		(2,931	)		(7,647	)		—		(7,647	)	$	(0.004	)	$	(0.004	)
	$	—	$	559	$	1,311	$	8,708	$	—	$	(10,578	)	$	(26,252	)	$	(36,830	)	$	(12,634	)	$	(24,196	)	$	—	$	(24,196	)	$	(0.012	)	$	(0.011	)

(1) Represents EMC Consolidated GAAP excluding restructuring and acquisition-related charges.

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

(3) Represents EMC Information Infrastructure GAAP excluding restructuring and acquisition-related charges.

(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 June 30, 2009

(in thousands, except per share amounts)

Unaudited

	Revenue			Cost of Revenue			Research and Development			Selling, General and Administrative			Restructuring and Other Special Charges			Operating Income		Other (Expense) 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	$	3,257,352		$	1,513,574		$	397,881		$	1,051,204		$	33,234		$	261,459	$	(12,798	)	$	248,661	$	38,045	$	210,616	$	(5,384	)	$	205,232		$	0.102		$	0.101
Restructuring and other special charges		—			—			—			—			(33,234	)		33,234		—			33,234		5,915		27,319		—			27,319		$	0.014		$	0.013
EMC Consolidated Adjusted (1)		3,257,352			1,513,574			397,881			1,051,204			—			294,693		(12,798	)		281,895		43,960		237,935		(5,384	)		232,551		$	0.116		$	0.114
Stock-based compensation expense		—			(22,257	)		(43,715	)		(55,912	)		—			121,884		—			121,884		26,863		95,021		(7,324	)		87,697		$	0.044		$	0.043
Intangible amortization		—			(30,535	)		(3,221	)		(25,656	)		—			59,412		—			59,412		20,426		38,986		(350	)		38,636		$	0.019		$	0.019
EMC Consolidated Non-GAAP (2)	$	3,257,352		$	1,460,782		$	350,945		$	969,636		$	—		$	475,989	$	(12,798	)	$	463,191	$	91,249	$	371,942	$	(13,058	)	$	358,884		$	0.178		$	0.177
EMC Information Infrastructure GAAP	$	2,802,239		$	1,432,563		$	277,756		$	838,141		$	33,234		$	220,545	$	(12,818	)	$	207,727	$	31,286	$	176,441	$	—		$	176,441		$	0.088		$	0.087
Restructuring and other special charges		—			—			—			—			(33,234	)		33,234		—			33,234		5,915		27,319		—			27,319		$	0.014		$	0.013
EMC Information Infrastructure Adjusted (3)		2,802,239			1,432,563			277,756			838,141			—			253,779		(12,818	)		240,961		37,201		203,760		—			203,760		$	0.101		$	0.100
Stock-based compensation expense		—			(15,224	)		(17,267	)		(34,665	)		—			67,156		—			67,156		16,388		50,768		—			50,768		$	0.025		$	0.025
Intangible amortization		—			(27,778	)		(3,221	)		(25,144	)		—			56,143		—			56,143		19,272		36,871		—			36,871		$	0.018		$	0.018
EMC Information Infrastructure Non-GAAP (4)	$	2,802,239		$	1,389,561		$	257,268		$	778,332		$	—		$	377,078	$	(12,818	)	$	364,260	$	72,861	$	291,399	$	—		$	291,399		$	0.145		$	0.144
VMware standalone GAAP	$	455,675		$	81,146		$	121,380		$	215,150		$	—		$	37,999	$	872		$	38,871	$	6,336	$	32,535	$	—		$	32,535		$	0.016		$	0.016
GAAP adjustments and eliminations		(562	)		(135	)		(1,255	)		(2,087	)		—			2,915		(852	)		2,063		423		1,640		(5,384	)		(3,744	)	$	(0.002	)	$	(0.002	)
VMware within EMC GAAP (5)		455,113			81,011			120,125			213,063			—			40,914		20			40,934		6,759		34,175		(5,384	)		28,791		$	0.014		$	0.014
Stock-based compensation expense		—			(7,033	)		(26,448	)		(21,247	)		—			54,728		—			54,728		10,475		44,253		(7,324	)		36,929		$	0.018		$	0.018
Intangible amortization		—			(2,757	)		—			(512	)		—			3,269		—			3,269		1,154		2,115		(350	)		1,765		$	0.001		$	0.001
VMware within EMC Non-GAAP (6)	$	455,113		$	71,221		$	93,677		$	191,304		$	—		$	98,911	$	20		$	98,931	$	18,388	$	80,543	$	(13,058	)	$	67,485		$	0.034		$	0.033
																												Wtd. Average Share O/S						2,011,508			2,030,048

Reconciliation of GAAP to Non-GAAP

For the Three Months Ended June 30, 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 Other Special Charges		Operating Income			Other (Expense) 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 (7)	$	—	$	—	$	—	$	—	$	—	$	—		$	(26,780	)	$	(26,780	)	$	(8,385	)	$	(18,395	)	$	—	$	(18,395	)	$	(0.009	)	$	(0.009	)
Transition costs (8)		—		1,342		1,616		5,951		—		(8,909	)		—			(8,909	)		(2,341	)		(6,568	)		—		(6,568	)	$	(0.003	)	$	(0.003	)
	$	—	$	1,342	$	1,616	$	5,951	$	—	$	(8,909	)	$	(26,780	)	$	(35,689	)	$	(10,726	)	$	(24,963	)	$	—	$	(24,963	)	$	(0.012	)	$	(0.012	)

(1) Represents EMC Consolidated GAAP excluding restructuring and other special charges.

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

(3) Represents EMC Information Infrastructure GAAP excluding restructuring and other special charges.

(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 stock-based compensation expense and intangible amortization.

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

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

Note: schedule may not add due to rounding

EMC CORPORATION

Consolidated Balance Sheets

(in thousands, except per share amounts)

Unaudited

	June 30, 2010			December 31, 2009
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	5,784,812		$	6,302,499
Short-term investments		1,015,143			392,839
Accounts and notes receivable, less allowance for doubtful accounts of $45,668 and $47,414		1,976,311			2,108,575
Inventories		813,756			886,289
Deferred income taxes		583,425			564,174
Other current assets		372,856			283,926
Total current assets		10,546,303			10,538,302
Long-term investments		3,539,361			2,692,323
Property, plant and equipment, net		2,286,042			2,224,346
Intangible assets, net		1,144,649			1,185,632
Goodwill		9,434,792			9,210,376
Other assets, net		1,060,304			961,024
Total assets	$	28,011,451		$	26,812,003
LIABILITIES & SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	824,579		$	899,298
Accrued expenses		1,959,340			1,944,210
Income taxes payable		85,550			41,691
Deferred revenue		2,541,030			2,262,968
Total current liabilities		5,410,499			5,148,167
Income taxes payable		246,469			235,976
Deferred revenue		1,551,084			1,373,798
Deferred income taxes		568,455			708,378
Long-term convertible debt		3,156,376			3,100,290
Other liabilities		176,342			184,920
Total liabilities		11,109,225			10,751,529
Commitments and contingencies
Shareholders’ equity:
Preferred stock, par value $0.01; authorized 25,000 shares; none outstanding		—			—
Common stock, par value $0.01; authorized 6,000,000 shares; issued 2,053,517 and 2,052,441 shares		20,535			20,524
Additional paid-in capital		3,829,433			3,875,791
Retained earnings		12,558,209			11,759,289
Accumulated other comprehensive loss, net		(144,859	)		(105,722	)
Total EMC Corporation’s shareholders’ equity		16,263,318			15,549,882
Non-controlling interest in VMware, Inc.		638,908			510,592
Total shareholders’ equity		16,902,226			16,060,474
Total liabilities and shareholders’ equity	$	28,011,451		$	26,812,003

EMC CORPORATION

Consolidated Statements of Cash Flows

(in thousands)

Unaudited

	Six Months Ended
	June 30, 2010			June 30, 2009
Cash flows from operating activities:
Cash received from customers	$	8,495,542		$	6,951,380
Cash paid to suppliers and employees		(6,291,713	)		(5,348,576	)
Dividends and interest received		54,219			73,448
Interest paid		(38,251	)		(35,900	)
Income taxes paid		(145,591	)		(202,273	)
Net cash provided by operating activities		2,074,206			1,438,079
Cash flows from investing activities:
Additions to property, plant and equipment		(301,192	)		(205,512	)
Capitalized software development costs		(185,634	)		(151,774	)
Purchases of short and long-term available-for-sale securities		(2,929,754	)		(3,315,606	)
Sales of short and long-term available-for-sale securities		1,244,979			2,730,097
Maturities of short and long-term available-for-sale securities		178,201			348,483
Purchase of Data Domain common stock		—			(65,000	)
Business acquisitions, net of cash acquired		(348,846	)		(98,860	)
Increase in strategic and other related investments		(5,812	)		(107,055	)
Net cash used in investing activities		(2,348,058	)		(865,227	)
Cash flows from financing activities:
Issuance of EMC’s common stock from the exercise of stock options		317,300			84,028
Issuance of VMware’s common stock from the exercise of stock options		215,907			81,606
EMC repurchase of EMC’s common stock		(517,370	)		—
EMC purchase of VMware’s common stock		(198,087	)		—
VMware repurchase of VMware’s common stock		(144,500	)		—
Payments on securities lending		—			(152,196	)
Excess tax benefits from stock-based compensation		111,807			6,715
Payment of long-term and short-term obligations		(3,515	)		(19,364	)
Proceeds from long-term and short-term obligations		1,116			1,116
Net cash (used in) provided by financing activities		(217,342	)		1,905
Effect of exchange rate changes on cash		(26,493	)		4,318
Net (decrease) increase in cash and cash equivalents		(517,687	)		579,075
Cash and cash equivalents at beginning of period		6,302,499			5,843,685
Cash and cash equivalents at end of period	$	5,784,812		$	6,422,760
Reconciliation of net income to net cash provided by operating activities:
Net income	$	828,187		$	415,961
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		566,439			509,066
Non-cash interest expense on convertible debt		52,172			53,079
Non-cash restructuring and other special charges		999			9,300
Stock-based compensation expense		319,397			234,531
Provision for doubtful accounts		11,358			7,219
Deferred income taxes, net		(101,930	)		60,067
Excess tax benefits from stock-based compensation		(111,807	)		(6,715	)
Other		2,399			450
Changes in assets and liabilities, net of acquisitions:
Accounts and notes receivable		163,646			391,899
Inventories		13,598			(9,910	)
Other assets		(104,326	)		(37,540	)
Accounts payable		(84,470	)		(27,915	)
Accrued expenses		(63,195	)		(134,894	)
Income taxes payable		188,968			(186,480	)
Deferred revenue		406,349			144,148
Other liabilities		(13,578	)		15,813
Net cash provided by operating activities	$	2,074,206		$	1,438,079

EMC Corporation

Reconciliation of Cash Flow from Operations to Free Cash Flow

(in thousands)

Unaudited

	Six Months Ended						Twelve Months Ended
	June 30, 2010			June 30, 2009			June 30, 2010			June 30, 2009
EMC Consolidated
Cash flow from Operations	$	2,074,206		$	1,438,079		$	3,970,512		$	3,466,298
Capital Expenditures		(301,192	)		(205,512	)		(507,259	)		(574,962	)
Capitalized Software		(185,634	)		(151,774	)		(338,380	)		(327,899	)
Free Cash Flow	$	1,587,380		$	1,080,793		$	3,124,873		$	2,563,437

EMC Corporation

Reconciliation of GAAP to Non-GAAP Tax Rate

(in thousands)

Unaudited

For the three months ended June 30, 2010
	Income Before Tax		Tax Provision			Tax Rate
EMC Consolidated GAAP	$	577,473	$	136,976		24	%
Stock-based compensation expense		161,721		38,869		24	%
Intangible asset amortization		71,963		22,882		32	%
Restructuring and acquisition-related charges		9,839		(1,700	)	-17	%
EMC Consolidated Non-GAAP	$	820,996	$	197,027		24	%

EMC Corporation

Reconciliation of Gross Margin GAAP to Non-GAAP

(in thousands)

Unaudited

	EMC Consolidated
Gross Margin GAAP	$	2,359,199
Stock-based compensation expense		25,085
Intangible asset amortization		34,016
Gross Margin Non-GAAP	$	2,418,300
Revenues	$	4,023,497
% GAAP		58.6	%
% Non-GAAP		60.1	%

EMC Corporation

Reconciliation of Operating Margin GAAP to Non-GAAP

(in thousands)

Unaudited

	EMC Consolidated
Operating Margin GAAP	$	587,984
Restructuring and acquisition-related charges		9,839
Stock-based compensation expense		161,423
Intangible asset amortization		71,963
Operating Margin Non-GAAP	$	831,209
Revenues	$	4,023,497
% GAAP		14.6	%
% Non-GAAP		20.7	%

EMC Corporation

Supplemental

Revenue Analysis

(in thousands)

Unaudited

Supplemental Revenue Data

	Q1 2009			Q2 2009			Q3 2009			Q4 2009			YTD 2009			Q1 2010			Q2 2010
Storage:
Product Revenue	$	1,572,408		$	1,632,309		$	1,818,230		$	2,175,104		$	7,198,051		$	2,017,314		$	2,076,855
Services Revenue		790,932			842,558			880,807			947,061			3,461,358			901,781			922,067
Total Storage Revenue	$	2,363,340		$	2,474,867		$	2,699,037		$	3,122,165		$	10,659,409		$	2,919,095		$	2,998,922
Information Intelligence Group:
Product Revenue	$	58,710		$	60,792		$	58,209		$	83,125		$	260,836		$	63,662		$	62,329
Services Revenue		115,605			119,445			118,979			124,724			478,753			114,502			116,105
Total Information Intelligence Group Revenue	$	174,315		$	180,237		$	177,188		$	207,849		$	739,589		$	178,164		$	178,434
Security:
Product Revenue	$	80,671		$	84,080		$	84,080		$	91,441		$	340,272		$	85,814		$	90,876
Services Revenue		62,035			63,055			68,420			72,168			265,678			75,654			82,460
Total Security Revenue	$	142,706		$	147,135		$	152,500		$	163,609		$	605,950		$	161,468		$	173,336
EMC Information Infrastructure:
Product Revenue	$	1,711,789		$	1,777,181		$	1,960,519		$	2,349,670		$	7,799,159		$	2,166,790		$	2,230,060
Services Revenue		968,572			1,025,058			1,068,206			1,143,953			4,205,789			1,091,937			1,120,632
Total EMC Information Infrastructure Revenue	$	2,680,361		$	2,802,239		$	3,028,725		$	3,493,623		$	12,004,948		$	3,258,727		$	3,350,692
VMware:
Product Revenue	$	257,331		$	228,089		$	240,062		$	303,504		$	1,028,986		$	311,927		$	323,256
Services Revenue		213,070			227,024			248,843			303,039			991,976			320,038			349,549
Total VMware Revenue	$	470,401		$	455,113		$	488,905		$	606,543		$	2,020,962		$	631,965		$	672,805
Consolidated Revenues:
Product Revenue	$	1,969,120		$	2,005,270		$	2,200,581		$	2,653,174		$	8,828,145		$	2,478,717		$	2,553,316
Services Revenue		1,181,642			1,252,082			1,317,049			1,446,992			5,197,765			1,411,975			1,470,181
Total Consolidated Revenues	$	3,150,762		$	3,257,352		$	3,517,630		$	4,100,166		$	14,025,910		$	3,890,692		$	4,023,497
Percentage impact to EMC revenue growth rate due to changes in exchange rates from the prior year		(3.5	)%		(3.7	)%		(1.3	)%		2.5	%		(1.4	)%		2.4	%		0.04	%

EMC Corporation

Reconciliation of EMC's Compounded Annual Growth Rate

Unaudited

	Actual 2004		Forecasted 2010		Forecasted CAGR
GAAP diluted earnings per share	$	0.36	$	0.84	15%
Restructuring and acquisition-related charges		0.01		0.02	9%
Stock-based compensation expense		0.02		0.23	55%
Intangible asset amortization		0.03		0.09	21%
Non-GAAP diluted earnings per share	$	0.41	$	1.18	19%

Schedule may not add due to rounding