Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Oct. 31, 2015 | |
Document Information [Line Items] | ||
Entity Registrant Name | VMWARE, INC. | |
Entity Central Index Key | 1,124,610 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Class A Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 121,019,601 | |
Class B Convertible Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 300,000,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Income - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Revenues: | |||||
License | $ 681 | $ 639 | $ 1,896 | $ 1,814 | |
Services | 991 | 876 | 2,883 | 2,519 | |
GSA settlement | 0 | 0 | (76) | 0 | |
Total revenues | 1,672 | 1,515 | 4,703 | 4,333 | |
Operating expenses (1): | |||||
Cost of license revenues | [1] | 46 | 46 | 142 | 143 |
Cost of services revenues | [1] | 212 | 196 | 609 | 519 |
Research and development | [1] | 331 | 327 | 958 | 936 |
Sales and marketing | [1] | 556 | 529 | 1,656 | 1,550 |
General and administrative | [1] | 201 | 169 | 568 | 498 |
Realignment charges | [1] | 0 | 6 | 20 | 4 |
Operating income | 326 | 242 | 750 | 683 | |
Investment income | 13 | 11 | 38 | 28 | |
Interest expense with EMC | (7) | (7) | (20) | (18) | |
Other income (expense), net | (7) | (2) | (8) | (2) | |
Income before income taxes | 325 | 244 | 760 | 691 | |
Income tax provision | 69 | 50 | 137 | 131 | |
Net income | $ 256 | $ 194 | $ 623 | $ 560 | |
Net income per weighted-average share, basic for Class A and Class B (USD per share) | $ 0.61 | $ 0.45 | $ 1.47 | $ 1.30 | |
Net income per weighted-average share, diluted for Class A and Class B (USD per share) | $ 0.60 | $ 0.45 | $ 1.46 | $ 1.29 | |
Weighted-average shares, basic for Class A and Class B (shares) | 422,329 | 430,463 | 424,799 | 430,408 | |
Weighted-average shares, diluted for Class A and Class B (shares) | 423,981 | 434,118 | 427,466 | 434,656 | |
Cost of license revenues | |||||
Operating expenses (1): | |||||
Stock-based compensation | $ 0 | $ 1 | $ 1 | $ 2 | |
Cost of services revenues | |||||
Operating expenses (1): | |||||
Stock-based compensation | 11 | 11 | 32 | 31 | |
Research and development | |||||
Operating expenses (1): | |||||
Stock-based compensation | 56 | 61 | 164 | 187 | |
Sales and marketing | |||||
Operating expenses (1): | |||||
Stock-based compensation | 43 | 43 | 124 | 128 | |
General and administrative | |||||
Operating expenses (1): | |||||
Stock-based compensation | $ 16 | $ 17 | $ 47 | $ 51 | |
[1] | Includes stock-based compensation as follows: Cost of license revenues $0 $1 $1 $2, Cost of services revenues $11 $11 $32 $31, Research and development $56 $61 $164 $187, Sales and marketing $43 $43 $124 $128, General and administrative $16 $17 $47 $51. |
Condensed Consolidated Stateme3
Condensed Consolidated Statements Of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 256 | $ 194 | $ 623 | $ 560 |
Changes in market value of available-for-sale securities: | ||||
Unrealized gains (losses), net of taxes of $1, $(2), $1 and $1 | 1 | (3) | 2 | 2 |
Reclassification of (gains) losses realized during the period, net of taxes of $0, $(1), $0 and $(2) for all periods | 0 | (1) | 0 | (2) |
Net change in market value of available-for-sale securities | 1 | (4) | 2 | 0 |
Changes in market value of effective foreign currency forward contracts: | ||||
Unrealized gains (losses), net of taxes of $0 for all periods | 1 | (3) | (4) | (3) |
Reclassification of (gains) losses realized during the period, net of taxes of $0 for all periods | (2) | (1) | 0 | 0 |
Net change in market value of effective foreign currency forward contracts | (1) | (4) | (4) | (3) |
Total other comprehensive income (loss) | 0 | (8) | (2) | (3) |
Total comprehensive income, net of taxes | $ 256 | $ 186 | $ 621 | $ 557 |
Condensed Consolidated Stateme4
Condensed Consolidated Statements Of Comprehensive Income (Parentheticals) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Tax effect on unrealized gains (losses) on available-for-sale securities | $ 1 | $ (2) | $ 1 | $ 1 |
Tax effect on reclassification of (gains) losses on available-for-sale securities realized during the period | 0 | (1) | 0 | (2) |
Tax effect on unrealized gains (losses) on effective foreign currency forward contracts | 0 | 0 | 0 | 0 |
Tax effect on reclassification of (gains) losses on effective foreign currency forward contracts realized during the period | $ 0 | $ 0 | $ 0 | $ 0 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 2,083 | $ 2,071 |
Short-term investments | 5,139 | 5,004 |
Accounts receivable, net of allowance for doubtful accounts of $2 and $2 | 1,011 | 1,520 |
Due from related parties, net | 25 | 49 |
Deferred tax assets | 254 | 248 |
Other current assets | 150 | 238 |
Total current assets | 8,662 | 9,130 |
Property and equipment, net | 1,124 | 1,035 |
Other assets | 175 | 174 |
Deferred tax assets | 204 | 165 |
Intangible assets, net | 645 | 748 |
Goodwill | 3,981 | 3,964 |
Total assets | 14,791 | 15,216 |
Current liabilities: | ||
Accounts payable | 139 | 203 |
Accrued expenses and other | 622 | 811 |
Unearned revenues | 2,989 | 2,982 |
Total current liabilities | 3,750 | 3,996 |
Notes payable to EMC | 1,500 | 1,500 |
Unearned revenues | 1,697 | 1,851 |
Other liabilities | 310 | 283 |
Total liabilities | $ 7,257 | $ 7,630 |
Contingencies | ||
Stockholders’ equity: | ||
Additional paid-in capital | $ 2,707 | $ 3,380 |
Accumulated other comprehensive income (loss) | (3) | (1) |
Retained earnings | 4,821 | 4,198 |
Total VMware, Inc.’s stockholders’ equity | 7,529 | 7,581 |
Non-controlling interests | 5 | 5 |
Total stockholders’ equity | 7,534 | 7,586 |
Total liabilities and stockholders’ equity | 14,791 | 15,216 |
Class A Common Stock | ||
Stockholders’ equity: | ||
Common stock | 1 | 1 |
Class B Convertible Common Stock | ||
Stockholders’ equity: | ||
Common stock | $ 3 | $ 3 |
Condensed Consolidated Balance6
Condensed Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Allowance for doubtful accounts | $ 2 | $ 2 |
Class A Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (shares) | 2,500,000,000 | 2,500,000,000 |
Common stock, shares issued (shares) | 121,799,000 | 129,359,000 |
Common stock, shares outstanding (shares) | 121,799,000 | 129,359,000 |
Class B Convertible Common Stock | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (shares) | 300,000,000 | 300,000,000 |
Common stock, shares outstanding (shares) | 300,000,000 | 300,000,000 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Operating activities: | ||
Net income | $ 623 | $ 560 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 246 | 255 |
Stock-based compensation | 368 | 399 |
Excess tax benefits from stock-based compensation | (27) | (34) |
Deferred income taxes, net | (44) | (115) |
Impairment of strategic investment | 5 | 0 |
Changes in assets and liabilities, net of acquisitions: | ||
Accounts receivable | 508 | 293 |
Other assets | 14 | (70) |
Due to/from related parties, net | 31 | 25 |
Accounts payable | (36) | 41 |
Accrued expenses | (153) | (4) |
Income taxes payable | 24 | 178 |
Unearned revenues | (148) | 237 |
Net cash provided by operating activities | 1,411 | 1,765 |
Investing activities: | ||
Additions to property and equipment | (274) | (254) |
Purchases of available-for-sale securities | (2,675) | (2,974) |
Sales of available-for-sale securities | 1,700 | 1,551 |
Maturities of available-for-sale securities | 840 | 483 |
Purchases of strategic investments | (11) | (41) |
Business acquisitions, net of cash acquired | (21) | (1,112) |
Decrease (increase) in restricted cash | 77 | (76) |
Other investing | 2 | (10) |
Net cash used in investing activities | (362) | (2,433) |
Financing activities: | ||
Proceeds from issuance of common stock | 123 | 158 |
Proceeds from issuance of notes payable to EMC | 0 | 1,050 |
Reduction in capital from EMC | 0 | (24) |
Proceeds from non-controlling interests | 4 | 7 |
Repurchase of common stock | (1,050) | (450) |
Excess tax benefits from stock-based compensation | 27 | 34 |
Shares repurchased for tax withholdings on vesting of restricted stock | (141) | (119) |
Net cash provided by (used in) financing activities | (1,037) | 656 |
Net increase (decrease) in cash and cash equivalents | 12 | (12) |
Cash and cash equivalents at beginning of the period | 2,071 | 2,305 |
Cash and cash equivalents at end of the period | 2,083 | 2,293 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 21 | 20 |
Cash paid for taxes, net | 155 | 65 |
Non-cash items: | ||
Changes in capital additions, accrued but not paid | (49) | (3) |
Fair value of stock-based awards assumed in acquisitions | $ 0 | $ 25 |
Overview and Basis of Presentat
Overview and Basis of Presentation | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Overview and Basis of Presentation | Overview and Basis of Presentation Company and Background VMware, Inc. (“VMware” or the “Company”) is the leader in virtualization infrastructure solutions utilized by organizations to help them transform the way they build, deliver and consume information technology (“IT”) resources. VMware’s virtualization infrastructure solutions, which include a suite of products and services designed to deliver a software-defined data center, run on industry-standard desktop computers and servers and support a wide range of operating system and application environments, as well as networking and storage infrastructures. Accounting Principles The financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Unaudited Interim Financial Information The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. In the opinion of management, these unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments and accruals, for a fair statement of VMware’s condensed consolidated results of operations, financial position and cash flows for the periods presented. Results of operations are not necessarily indicative of the results that may be expected for the full year 2015. Certain information and footnote disclosures typically included in annual consolidated financial statements have been condensed or omitted. Accordingly, these unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in VMware’s 2014 Annual Report on Form 10-K. As of September 30, 2015 , EMC Corporation (“EMC”) held 81.3% of VMware’s outstanding common stock and 97.5% of the combined voting power of VMware’s outstanding common stock, including 43 million shares of VMware’s Class A common stock and all of VMware’s Class B common stock. VMware is a majority-owned and controlled subsidiary of EMC, and its results of operations and financial position are consolidated with EMC’s financial statements. On October 12, 2015, Dell, Inc. (“Dell”), Denali Holding Inc. (“Denali”) and EMC entered into a definitive agreement under which Denali has agreed to acquire EMC. Refer to Note M for further information. Management believes the assumptions underlying the condensed consolidated financial statements are reasonable. However, the amounts recorded for VMware’s intercompany transactions with EMC may not be considered arm’s length with an unrelated third party. Therefore, the financial statements included herein may not necessarily reflect the results of operations, financial position and cash flows had VMware engaged in such transactions with an unrelated third party during all periods presented. Accordingly, VMware’s historical financial information is not necessarily indicative of what the Company’s results of operations, financial position and cash flows will be in the future if and when VMware contracts at arm’s length with unrelated third parties for the services the Company receives from and provides to EMC. Principles of Consolidation The condensed consolidated financial statements include the accounts of VMware and subsidiaries in which VMware has a controlling financial interest. Non-controlling interests are presented as a separate component within total stockholders’ equity and represent the equity and cumulative pro-rata share of the results of operations attributable to the non-controlling interests. Net earnings attributable to the non-controlling interests are included in other income (expense), net on the condensed consolidated statements of income and are not presented separately as the amounts were not material for the periods presented. All intercompany transactions and account balances between VMware and its subsidiaries have been eliminated in consolidation. Transactions with EMC and its subsidiaries are generally settled in cash and are classified on the condensed consolidated statements of cash flows based upon the nature of the underlying transaction. Reclassification Certain prior period amounts related to the notes payable to EMC have been reclassified within the financing activities section of the condensed consolidated statements of cash flows. The reclassifications had no effect on total cash flows used in or provided by operating, investing or financing activities as previously reported. Use of Accounting Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the reported amounts of revenues and expenses during the reporting periods, and the disclosure of contingent liabilities at the date of the financial statements. Estimates are used for, but not limited to, trade receivable valuation, marketing development funds and rebates, useful lives assigned to fixed assets and intangible assets, valuation of goodwill and definite-lived intangibles, income taxes, stock-based compensation, and contingencies. Actual results could differ from those estimates. New Accounting Pronouncement During May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606). The updated revenue standard establishes principles for recognizing revenue and develops a common revenue standard for all industries. Upon adoption, entities will be required to recognize the amount of revenue that they expect to be entitled to for the transfer of promised goods or services to their customers. The updated standard is effective for the Company in the first quarter of 2018 and permits the use of either the retrospective or cumulative effect transition method. Early adoption is permitted, but not earlier than the first quarter of 2017. The Company has not selected a transition method and is currently evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. |
Business Combinations, Definite
Business Combinations, Definite-Lived Intangible Assets, Net and Goodwill | 9 Months Ended |
Sep. 30, 2015 | |
Business Combinations [Abstract] | |
Business Combinations, Definite-Lived Intangible Assets, Net and Goodwill | Business Combination, Definite-Lived Intangible Assets, Net and Goodwill Business Combination On February 2, 2015, VMware acquired all of the outstanding shares of Immidio B.V. (“Immidio”) for approximately $21 million of cash, net of liabilities assumed. VMware acquired Immidio to expand VMware’s Workspace Environment Management solutions within the End-User Computing product group. The preliminary purchase price primarily included $8 million of identifiable intangible assets and approximately $17 million of goodwill that is expected to be non-deductible for tax purposes. The impact of the acquisition was not material to VMware’s condensed consolidated financial statements. Definite-Lived Intangible Assets, Net As of September 30, 2015 and December 31, 2014 , definite-lived intangible assets consisted of the following (amounts in tables in millions): September 30, 2015 Weighted-Average Gross Carrying Amount Accumulated Amortization Net Book Value Purchased technology 6.6 $ 651 $ (281 ) $ 370 Leasehold interest 34.9 149 (19 ) 130 Customer relationships and customer lists 8.3 151 (60 ) 91 Trademarks and tradenames 8.6 61 (14 ) 47 Other 2.9 20 (13 ) 7 Total definite-lived intangible assets $ 1,032 $ (387 ) $ 645 December 31, 2014 Weighted-Average Gross Carrying Amount Accumulated Amortization Net Book Value Purchased technology 6.5 $ 699 $ (252 ) $ 447 Leasehold interest 34.9 149 (15 ) 134 Customer relationships and customer lists 8.2 157 (53 ) 104 Trademarks and tradenames 8.6 61 (9 ) 52 Other 2.7 18 (7 ) 11 Total definite-lived intangible assets $ 1,084 $ (336 ) $ 748 Amortization expense on definite-lived intangible assets was $36 million and $110 million during the three and nine months ended September 30, 2015 , respectively, and $37 million and $104 million during the three and nine months ended September 30, 2014 , respectively. Based on intangible assets recorded as of September 30, 2015 and assuming no subsequent additions or impairment of underlying assets, the remaining estimated annual amortization expense is expected to be as follows (table in millions): Remainder of 2015 $ 35 2016 128 2017 121 2018 108 2019 87 Thereafter 166 Total $ 645 Goodwill The following table summarizes the changes in the carrying amount of goodwill during the nine months ended September 30, 2015 (table in millions): Balance, January 1, 2015 $ 3,964 Increase in goodwill related to a business combination 17 Balance, September 30, 2015 $ 3,981 |
Realignment Charges
Realignment Charges | 9 Months Ended |
Sep. 30, 2015 | |
Restructuring and Related Activities [Abstract] | |
Realignment Charges | Realignment Charges During the first quarter of 2015 , VMware eliminated approximately 350 positions across all major functional groups and geographies to streamline its operations. As a result of this action, $20 million of severance-related realignment charges were recognized during the nine months ended September 30, 2015 . As of September 30, 2015 , $1 million remained in accrued expenses and other on the condensed consolidated balance sheets and is expected to be paid during 2015. The following table summarizes the activity for the accrued realignment charges for the nine months ended September 30, 2015 (table in millions): Nine Months Ended September 30, 2015 Balance as of January 1, 2015 Realignment Charges Utilization Balance as of September 30, 2015 Severance-related costs $ 8 $ 20 $ (27 ) $ 1 During the third quarter of 2014, VMware eliminated approximately 90 positions across all major functional groups and geographies to streamline its operations. As a result of these actions, $7 million of severance-related realignment charges was recognized during the three months ended September 30, 2014. |
Net Income per Share
Net Income per Share | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Net Income per Share | Net Income per Share Basic net income per share is computed by dividing net income by the weighted-average number of common shares outstanding during the period. Diluted net income per share is computed by dividing net income by the weighted-average number of common shares outstanding and potentially dilutive securities outstanding during the period, as calculated using the treasury stock method. Potentially dilutive securities primarily include unvested restricted stock units, performance stock units, stock options and purchase options under VMware’s employee stock purchase plan. Securities are excluded from the computations of diluted net income per share if their effect would be anti-dilutive. VMware uses the two-class method to calculate net income per share as both classes share the same rights in dividends, therefore basic and diluted earnings per share are the same for both classes. The following table sets forth the computations of basic and diluted net income per share during the three and nine months ended September 30, 2015 and 2014 (net income in millions, shares in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Net income $ 256 $ 194 $ 623 $ 560 Weighted-average shares, basic for Class A and Class B 422,329 430,463 424,799 430,408 Effect of dilutive securities 1,652 3,655 2,667 4,248 Weighted-average shares, diluted for Class A and Class B 423,981 434,118 427,466 434,656 Net income per weighted-average share, basic for Class A and Class B $ 0.61 $ 0.45 $ 1.47 $ 1.30 Net income per weighted-average share, diluted for Class A and Class B $ 0.60 $ 0.45 $ 1.46 $ 1.29 The following table sets forth the weighted-average common share equivalents of Class A common stock that were excluded from the diluted net income per share calculations during the three and nine months ended September 30, 2015 and 2014 , because their effect would have been anti-dilutive (shares in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Anti-dilutive securities: Employee stock options 2,129 1,180 2,173 1,244 Restricted stock units 365 107 58 37 Total 2,494 1,287 2,231 1,281 |
Cash, Cash Equivalents and Inve
Cash, Cash Equivalents and Investments | 9 Months Ended |
Sep. 30, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Cash, Cash Equivalents and Investments | Cash, Cash Equivalents and Investments Cash, cash equivalents and investments as of September 30, 2015 and December 31, 2014 consisted of the following (tables in millions): September 30, 2015 Cost or Amortized Cost Unrealized Gains Unrealized Losses Aggregate Cash $ 770 $ — $ — $ 770 Cash equivalents: Money-market funds $ 1,312 $ — $ — $ 1,312 Municipal obligations 1 — — 1 Total cash equivalents $ 1,313 $ — $ — $ 1,313 Short-term investments: U.S. Government and agency obligations $ 642 $ 3 $ — $ 645 U.S. and foreign corporate debt securities 3,337 5 (8 ) 3,334 Foreign governments and multi-national agency obligations 35 — — 35 Municipal obligations 823 1 — 824 Asset-backed securities 30 — — 30 Mortgage-backed securities 271 — — 271 Total short-term investments $ 5,138 $ 9 $ (8 ) $ 5,139 Other assets: Marketable available-for-sale equity securities $ 15 $ 1 $ — $ 16 December 31, 2014 Cost or Amortized Cost Unrealized Gains Unrealized Losses Aggregate Fair Value Cash $ 885 $ — $ — $ 885 Cash equivalents: Money-market funds $ 1,130 $ — $ — $ 1,130 U.S. and foreign corporate debt securities 54 — — 54 Foreign governments and multi-national agency obligations 2 — — 2 Total cash equivalents $ 1,186 $ — $ — $ 1,186 Short-term investments: U.S. Government and agency obligations $ 542 $ — $ — $ 542 U.S. and foreign corporate debt securities 3,236 3 (5 ) 3,234 Foreign governments and multi-national agency obligations 23 — — 23 Municipal obligations 930 2 — 932 Asset-backed securities 53 — — 53 Mortgage-backed securities 221 — (1 ) 220 Total short-term investments $ 5,005 $ 5 $ (6 ) $ 5,004 Refer to Note F for further information regarding the fair value of VMware’s cash equivalents and investments. The realized gains and losses on investments during the three and nine months ended September 30, 2015 and 2014 were not material. Unrealized losses on cash equivalents and investments as of September 30, 2015 and December 31, 2014 , which have been in a net loss position for less than twelve months, were classified by investment category as follows (table in millions): September 30, 2015 December 31, 2014 Fair Value Unrealized Losses Fair Value Unrealized Losses U.S. and foreign corporate debt securities $ 1,545 $ (7 ) $ 1,964 $ (5 ) Mortgage-backed securities 132 (1 ) 107 (1 ) Total $ 1,677 $ (8 ) $ 2,071 $ (6 ) Unrealized losses on cash equivalents and available-for-sale investments, which have been in a net loss position for twelve months or greater, were not material as of September 30, 2015 and December 31, 2014 . Contractual Maturities The contractual maturities of short-term investments held at September 30, 2015 consisted of the following (table in millions): Amortized Cost Basis Aggregate Fair Value Due within one year $ 1,592 $ 1,593 Due after 1 year through 5 years 3,243 3,243 Due after 5 years through 10 years 95 95 Due after 10 years 208 208 Total short-term investments $ 5,138 $ 5,139 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Assets and Liabilities Measured and Recorded at Fair Value on a Recurring Basis Certain financial assets and liabilities are measured at fair value on a recurring basis. VMware determines fair value using the following hierarchy: • Level 1 - Quoted prices in active markets for identical assets or liabilities • Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are noted active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities • Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities VMware’s fixed income securities are primarily classified as Level 2, with the exception of some of the U.S. Government and agency obligations which are classified as Level 1. Additionally, VMware’s Level 2 classification includes foreign currency forward contracts and notes payable to EMC. At September 30, 2015 and December 31, 2014 , VMware’s Level 2 securities were generally priced using non-binding market consensus prices that are corroborated by observable market data, quoted market prices for similar instruments, or pricing models such as discounted cash flow techniques. VMware did not have any material assets or liabilities that fall into Level 3 of the fair value hierarchy as of September 30, 2015 and December 31, 2014 , and there have been no transfers between fair value measurement levels during the three and nine months ended September 30, 2015 and 2014 . The following tables set forth the fair value hierarchy of VMware’s money-market funds, available-for-sale securities, and foreign currency forward contracts, that were required to be measured at fair value as of September 30, 2015 and December 31, 2014 (tables in millions): September 30, 2015 Level 1 Level 2 Total Cash equivalents: Money-market funds $ 1,312 $ — $ 1,312 Municipal obligations — 1 1 Total cash equivalents $ 1,312 $ 1 $ 1,313 Short-term investments: U.S. Government and agency obligations $ 472 $ 173 $ 645 U.S. and foreign corporate debt securities — 3,334 3,334 Foreign governments and multi-national agency obligations — 35 35 Municipal obligations — 824 824 Asset-backed securities — 30 30 Mortgage-backed securities — 271 271 Total short-term investments $ 472 $ 4,667 $ 5,139 Other assets: Marketable available-for-sale equity securities $ 16 $ — $ 16 Accrued expenses and other: Foreign currency forward contracts $ — $ (3 ) $ (3 ) December 31, 2014 Level 1 Level 2 Total Cash equivalents: Money-market funds $ 1,130 $ — $ 1,130 U.S. and foreign corporate debt securities — 54 54 Foreign governments and multi-national agency obligations — 2 2 Total cash equivalents $ 1,130 $ 56 $ 1,186 Short-term investments: U.S. Government and agency obligations $ 353 $ 189 $ 542 U.S. and foreign corporate debt securities — 3,234 3,234 Foreign governments and multi-national agency obligations — 23 23 Municipal obligations — 932 932 Asset-backed securities — 53 53 Mortgage-backed securities — 220 220 Total short-term investments $ 353 $ 4,651 $ 5,004 Other current assets: Foreign currency forward contracts $ — $ 1 $ 1 Accrued expenses and other: Foreign currency forward contracts $ — $ (1 ) $ (1 ) VMware has elected not to record its notes payable to EMC at fair value, but has measured the notes at fair value for disclosure purposes. As of September 30, 2015 and December 31, 2014 , the fair value of the notes payable to EMC was $1,499 million and $1,503 million , respectively. Fair value was estimated based on observable market interest rates (Level 2 inputs). VMware offers a deferred compensation plan for eligible employees that allows participants to defer payment for part or all of their compensation. VMware’s results of operations are not significantly affected by this plan since changes in the fair value of the assets substantially offset changes in the fair value of the liabilities. As such, assets and liabilities associated with this plan have not been included in the above tables. Assets and liabilities associated with this plan were both approximately $18 million and $8 million as of September 30, 2015 and December 31, 2014 , respectively, and are included in other assets and other liabilities on the condensed consolidated balance sheets. Assets Measured and Recorded at Fair Value on a Non-Recurring Basis VMware evaluated the strategic investments in its portfolio accounted for under the cost method to assess whether any of its strategic investments were other-than-temporarily impaired. VMware uses Level 3 inputs as part of its impairment analysis, including, pre- and post-money valuations of recent financing events and the impact of those on its fully diluted ownership percentages, as well as other available information regarding the issuer’s historical and forecasted performance. The estimated fair value of these investments is considered in VMware’s impairment review if any events or changes in circumstances occur that might have a significant adverse effect on their value. During the three and nine months ended September 30, 2015 , VMware recognized a charge of approximately $5 million as a result of determining that a strategic investment was considered to be other-than-temporarily impaired. All other realized gains and losses on investments in the three and nine months ended September 30, 2015 and 2014 were not material. Strategic investments are included in other assets on the condensed consolidated balance sheets. The carrying value of VMware’s strategic investments accounted for under the cost method was $100 million and $110 million as of September 30, 2015 and December 31, 2014 , respectively. |
Derivatives and Hedging Activit
Derivatives and Hedging Activities | 9 Months Ended |
Sep. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives and Hedging Activities | Derivatives and Hedging Activities VMware conducts business on a global basis in multiple foreign currencies, subjecting the Company to foreign currency risk. To mitigate this risk, VMware utilizes hedging contracts as described below, which potentially expose the Company to credit risk to the extent that the counterparties may be unable to meet the terms of the agreement. VMware manages counterparty risk by seeking counterparties of high credit quality, by monitoring credit ratings and credit spreads of, and other relevant public information about its counterparties. VMware does not, and does not intend to, use derivative instruments for trading or speculative purposes. Cash Flow Hedges To mitigate its exposure to foreign currency fluctuations resulting from operating expenses denominated in certain foreign currencies, VMware enters into foreign currency forward contracts. The Company designates these forward contracts as cash flow hedging instruments as the accounting criteria for such designation have been met. Therefore, the effective portion of gains or losses resulting from changes in the fair value of these hedges is initially reported in accumulated other comprehensive income (loss) on the condensed consolidated balance sheets and is subsequently reclassified to the related operating expense line item on the condensed consolidated statements of income in the same period that the underlying expenses are incurred. During the three and nine months ended September 30, 2015 and 2014 the effective portion of gains or losses reclassified to the condensed consolidated statements of income was not material to the individual functional line items. Interest charges or “forward points” on VMware’s forward contracts are excluded from the assessment of hedge effectiveness and are recorded in other income (expense), net on the condensed consolidated statements of income as incurred. VMware enters into forward contracts annually, which have maturities of 12 months or less. As of September 30, 2015 and December 31, 2014 , VMware had foreign currency forward contracts designated as cash flow hedges with a total notional value of $64 million and $240 million , respectively. The notional value represents the gross amount of foreign currency that will be bought or sold upon maturity of the forward contract. During the three and nine months ended September 30, 2015 and 2014 , all cash flow hedges were considered effective. Foreign Currency Forward Contracts Not Designated as Hedges VMware has established a program that utilizes foreign currency forward contracts to offset the foreign currency risk associated with net outstanding monetary asset and liability positions. These forward contracts are not designated as hedging instruments under applicable accounting guidance, and therefore all changes in the fair value of the forward contracts are reported in other income (expense), net on the condensed consolidated statements of income. VMware enters into foreign currency forward contracts on a monthly basis, which typically have a contractual term of one month. As of September 30, 2015 and December 31, 2014 , VMware had outstanding forward contracts with a total notional value of $511 million and $697 million , respectively. The notional value represents the gross amount of foreign currency that will be bought or sold upon maturity of the forward contract. During the three and nine months ended September 30, 2015 , VMware recognized a gain of $12 million and $33 million , respectively, relating to the settlement of foreign currency forward contracts. During the three and nine months ended September 30, 2014 , VMware recognized a gain of $29 million and $24 million , respectively. Gains and losses are recorded in other income (expense), net on the condensed consolidated statements of income. The combined gains and losses derived from the settlement of foreign currency forward contracts and the underlying foreign currency denominated assets and liabilities resulted in a net loss of $1 million and $10 million during the three and nine months ended September 30, 2015 , respectively. The combined gains and losses derived from the settlement of foreign currency forward contracts and the underlying foreign currency denominated assets and liabilities resulted in a net loss of $3 million and $4 million during the three and nine months ended September 30, 2014 , respectively. Net gains and losses are recorded in other income (expense), net on the condensed consolidated statements of income. |
Unearned Revenues
Unearned Revenues | 9 Months Ended |
Sep. 30, 2015 | |
Deferred Revenue Disclosure [Abstract] | |
Unearned Revenues | Unearned Revenues Unearned revenues as of September 30, 2015 and December 31, 2014 consisted of the following (table in millions): September 30, December 31, 2015 2014 Unearned license revenues $ 404 $ 488 Unearned software maintenance revenues 3,850 3,905 Unearned professional services revenues 432 440 Total unearned revenues $ 4,686 $ 4,833 Unearned license revenues are generally recognized upon delivery of existing or future products or services, or are otherwise recognized ratably over the term of the arrangement. Future products include, in some cases, emerging products that are offered as part of product promotions where the purchaser of an existing product is entitled to receive the future product at no additional charge. To the extent the future product has not been delivered and vendor-specific objective evidence (“VSOE”) of fair value cannot be established, the revenue for the entire order is deferred until such time as all product delivery obligations have been fulfilled. Unearned revenues are impacted by timing of both product promotion offers and delivery of the future products offered as part of a product promotion. In the event the arrangement does not include professional services, unearned license revenues may also be recognized ratably, if the customer is granted the right to receive unspecified future products or VSOE of fair value on the software maintenance element of the arrangement does not exist. Total unearned license revenues may vary over periods for a variety of factors, including the type and level of promotions offered, and the timing of when the products are delivered upon general availability. Unearned software maintenance revenues are attributable to VMware’s maintenance contracts and are generally recognized ratably over the contract period. The weighted-average remaining term at September 30, 2015 was approximately 1.9 years . Unearned professional services revenues result primarily from prepaid professional services, including training, and are generally recognized as the services are delivered. |
Contingencies
Contingencies | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies Litigation During the second quarter of 2015, VMware reached an agreement with the Department of Justice (“DOJ”) and the General Services Administration (“GSA”) to pay $76 million to resolve allegations that VMware's government sales practices between 2006 and 2013 had violated the federal False Claims Act. The settlement was paid and recorded as a reduction of VMware's total revenues during the nine months ended September 30, 2015. On March 27, 2015, Phoenix Technologies (“Phoenix”) filed a complaint against VMware in the U.S. District Court for the Northern District of California asserting claims for copyright infringement and breach of contract relating to a version of Phoenix’s BIOS software that VMware licensed from Phoenix. In the lawsuit, Phoenix is seeking injunctive relief and monetary damages. Trial is currently scheduled for November 2016. VMware believes that it has meritorious defenses in connection with this lawsuit, and currently a reasonably possible loss or range of loss cannot be estimated. On March 4, 2015, Christoph Hellwig, a software developer who alleges that software code he wrote is used in a component of the Company's vSphere product, filed a lawsuit against VMware in the Hamburg Regional Court in Germany alleging copyright infringement for failing to comply with the terms of an open source General Public License v.2 (“GPL v.2”) and seeking an order requiring VMware to comply with the GPL v.2 or cease distribution of any affected code within Germany. VMware believes that it has meritorious defenses in connection with this lawsuit, and currently a reasonably possible loss or range of loss cannot be estimated. VMware accrues for a liability at the low end of the range of estimated losses when a determination has been made that a loss is both probable and the amount of the loss can be reasonably estimated. Significant judgment is required in both the determination that the occurrence of a loss is probable and is reasonably estimable. In making such judgments, VMware considers the impact of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular matter. Legal costs are generally recognized as expense when incurred. VMware believes that it has valid defenses against each of the ongoing legal matters disclosed. However, given the unpredictable nature of legal proceedings, an unfavorable resolution of one or more legal proceedings, claims, or investigations could have a material adverse effect on VMware’s condensed consolidated financial statements. VMware is also subject to other legal, administrative and regulatory proceedings, claims, demands and investigations in the ordinary course of business, including claims with respect to commercial, contracting and sales practices, product liability, intellectual property, employment, class action, whistleblower and other matters. From time to time, VMware also receives inquiries from and has discussions with government entities on various matters. VMware does not believe that any liability from any reasonably foreseeable disposition of such claims and litigation, individually or in the aggregate, would have a material adverse effect on its condensed consolidated financial statements. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity VMware Stock Repurchases On January 27, 2015, VMware’s Board of Directors authorized the repurchase of up to an additional one billion dollars of VMware’s Class A common stock through the end of 2017. Stock will be purchased from time to time, in the open market or through private transactions, subject to market conditions. The timing of any repurchases and the actual number of shares repurchased will depend on a variety of factors, including VMware’s stock price, cash requirements for operations and business combinations, corporate and regulatory requirements and other market and economic conditions. VMware is not obligated to purchase any shares under its stock repurchase programs. Purchases can be discontinued at any time VMware believes additional purchases are not warranted. All shares repurchased under VMware’s stock repurchase programs are retired. The following table summarizes stock repurchase authorization that remains open as of September 30, 2015 (amount in table in millions): Authorization Date Amount Authorized Expiration Date Status January 27, 2015 $1,000 December 31, 2017 Open As of September 30, 2015 , the cumulative authorized amount remaining for repurchase was $910 million . The following table summarizes stock repurchase activity during the three and nine months ended September 30, 2015 and 2014 (aggregate purchase price in millions, shares in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Aggregate purchase price $ 200 $ 43 $ 1,050 $ 450 Class A common shares repurchased 2,408 436 12,524 4,691 Weighted-average price per share $ 83.06 $ 98.94 $ 83.84 $ 95.56 The aggregate purchase price of repurchased shares includes commissions and is classified as a reduction to additional paid-in capital. VMware Stock Options The following table summarizes stock option activity since January 1, 2015 (shares in thousands): Number of Shares Weighted- Average Exercise Price (per share) Outstanding, January 1, 2015 5,869 $ 50.54 Granted 13 84.68 Forfeited (213 ) 66.83 Exercised (2,289 ) 29.92 Outstanding, September 30, 2015 3,380 63.65 The stock options outstanding as of September 30, 2015 had an aggregate intrinsic value of $74 million based on VMware’s closing price as of September 30, 2015 . VMware Restricted Stock VMware's restricted stock primarily consists of restricted stock unit (“RSU”) awards granted to employees. RSUs are valued based on VMware's stock price on the date of grant. The shares underlying the RSU awards are not issued until the RSUs vest. Upon vesting, each RSU converts into one share of VMware Class A common stock. VMware's restricted stock also includes performance stock unit (“PSU”) awards, which have been granted to certain of VMware’s executives and employees. The PSU awards include performance conditions and, in certain cases, a time-based vesting component. Upon vesting, each PSU award will convert into VMware’s Class A common stock at various ratios ranging from 0.5 to 2.0 shares per PSU, depending upon the degree of achievement of the performance target designated by each individual award. If minimum performance thresholds are not achieved, then no shares will be issued. As of September 30, 2015 , the number of PSUs outstanding includes certain PSUs for which performance conditions have concluded but that remain subject to certain service conditions. The following table summarizes restricted stock activity since January 1, 2015 (units in thousands): Number of Units Weighted- Average Grant Date Fair Value (per unit) Outstanding, January 1, 2015 12,585 $ 88.88 Granted 5,823 86.98 Vested (3,311 ) 92.17 Forfeited (1,382 ) 88.16 Outstanding, September 30, 2015 13,715 87.38 The total fair value of VMware restricted stock that vested during the nine months ended September 30, 2015 was $281 million . As of September 30, 2015 , restricted stock representing 13.7 million shares of VMware’s Class A common stock were outstanding, with an aggregate intrinsic value of $1,081 million based on VMware’s closing price as of September 30, 2015 . As of September 30, 2015 , the total unrecognized compensation cost for stock options and restricted stock was $909 million and will be recognized through 2019 with a weighted-average remaining period of 1.5 years . Accumulated Other Comprehensive Income (Loss) The changes in components of accumulated other comprehensive income (loss) during the nine months ended September 30, 2015 and 2014 were as follows (tables in millions): Unrealized Gain on Unrealized Loss on Total Balance, January 1, 2015 $ — $ (1 ) $ (1 ) Unrealized gain (loss), net of taxes of $1, $0 and $1 2 (4 ) (2 ) Balance, September 30, 2015 $ 2 $ (5 ) $ (3 ) Unrealized Gain on Unrealized Loss on Total Balance, January 1, 2014 $ 4 $ — $ 4 Unrealized gain (loss), net of taxes of $1, $0 and $1 2 (3 ) (1 ) Amounts reclassified from accumulated other comprehensive income to the condensed consolidated statement of income, net of taxes of $(2), $0 and $(2) (2 ) — (2 ) Other comprehensive income (loss), net — (3 ) (3 ) Balance, September 30, 2014 $ 4 $ (3 ) $ 1 Unrealized gains on VMware’s available-for-sale securities are reclassified to investment income on the condensed consolidated statements of income in the period that such gains are realized. The effective portion of gains (losses) resulting from changes in the fair value of forward contracts designated as cash flow hedging instruments are reclassified to its related operating expense line item on the condensed consolidated statements of income in the same period that the underlying expenses are incurred. The amounts recorded to their related operating expense functional line items on the condensed consolidated statements of income during the three and nine months ended September 30, 2015 and 2014 were not material to the individual functional line items. |
Related Parties
Related Parties | 9 Months Ended |
Sep. 30, 2015 | |
Related Party Transactions [Abstract] | |
Related Parties | Related Parties The information provided below includes a summary of the transactions entered into with EMC and EMC’s consolidated subsidiaries (collectively “EMC”). EMC acquired VCE Company LLC (“VCE”) during the fourth quarter of 2014. Transactions with VCE from the date EMC acquired the controlling interest in VCE have been included in the tables below. Transactions with EMC VMware and EMC engaged in the following ongoing intercompany transactions, which resulted in revenues and receipts and unearned revenues for VMware: • Pursuant to an ongoing reseller arrangement with EMC, EMC bundles VMware’s products and services with EMC’s products and sells them to end users. • EMC purchases products and services from VMware for internal use. • VMware provides professional services to end users based upon contractual agreements with EMC. • From time to time, VMware and EMC enter into agreements to collaborate on technology projects, and EMC pays VMware for services that VMware provides to EMC in connection with such projects. • Pursuant to an ongoing distribution agreement, VMware acts as the selling agent for certain products and services of Pivotal Software, Inc. (“Pivotal”), a subsidiary of EMC, in exchange for an agency fee. Under this agreement, cash is collected from the end user by VMware and remitted to Pivotal, net of the contractual agency fee. • VMware provides various transition services to Pivotal. Support costs incurred by VMware are reimbursed to VMware and are recorded as a reduction to the costs incurred by VMware. Information about VMware’s revenues and receipts from such arrangements with EMC during the three and nine months ended September 30, 2015 and 2014 and unearned revenues as of September 30, 2015 and December 31, 2014 consisted of the following (table in millions): Revenues and Receipts from EMC Unearned Revenues from EMC Three Months Ended Nine Months Ended September 30, September 30, September 30, December 31, 2015 2014 2015 2014 2015 2014 Reseller revenues $ 68 $ 47 $ 199 $ 136 $ 256 $ 290 Internal-use revenues 4 4 13 17 11 18 Professional services revenues 20 13 68 53 5 9 Agency fee revenues 1 1 4 4 — — Reimbursement for transition services 2 — 3 1 n/a n/a VMware and EMC engaged in the following ongoing intercompany transactions, which resulted in costs to VMware: • VMware purchases and leases products and purchases services from EMC. • From time to time, VMware and EMC enter into agreements to collaborate on technology projects, and VMware pays EMC for services provided to VMware by EMC related to such projects. • In certain geographic regions where VMware does not have an established legal entity, VMware contracts with EMC subsidiaries for support services and EMC personnel who are managed by VMware. The costs incurred by EMC on VMware’s behalf related to these employees are charged to VMware with a mark-up intended to approximate costs that would have been incurred had VMware contracted for such services with an unrelated third party. These costs are included as expenses on VMware’s condensed consolidated statements of income and primarily include salaries, benefits, travel and rent expenses. EMC also incurs certain administrative costs on VMware’s behalf in the U.S. that are recorded as expenses on VMware’s condensed consolidated statements of income. Information about VMware’s costs from such arrangements with EMC for the three and nine months ended September 30, 2015 and 2014 consisted of the following (table in millions): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Purchases and leases of products and purchases of services $ 14 $ 15 $ 45 $ 48 Collaborative technology project costs 1 3 4 10 EMC subsidiary support and administrative costs 24 31 79 107 VMware also purchases EMC products through EMC's channel partners. Purchases of EMC products through EMC's channel partners were $7 million and $33 million during the three and nine months ended September 30, 2015 , respectively, and $7 million and $18 million during the three and nine months ended September 30, 2014 , respectively. Certain Stock-Based Compensation Effective September 1, 2012, Pat Gelsinger was appointed Chief Executive Officer of VMware. Prior to joining VMware, Mr. Gelsinger was the President and Chief Operating Officer of EMC Information Infrastructure Products. Mr. Gelsinger retains certain of his EMC equity awards that were held as of September 1, 2012 and he continues to vest in such awards. Stock-based compensation related to Mr. Gelsinger’s EMC awards are being recognized on VMware’s condensed consolidated statements of income over the awards’ remaining requisite service periods. Tax Sharing Agreement with EMC Pursuant to a tax sharing agreement between VMware and EMC, payments are made between VMware and EMC related to VMware's portion of federal income taxes on EMC's consolidated tax return as well as income taxes for states in which combined state income tax returns are filed. The following table summarizes these payments made between VMware and EMC during the three and nine months ended September 30, 2015 and 2014 (table in millions): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Payments from VMware to EMC $ — $ — $ 92 $ 20 Payments made by VMware to EMC result from VMware having a tax liability. The amount that VMware pays to EMC for its portion of federal income taxes on EMC’s consolidated tax return differs from the amount VMware would owe on a separate return basis, and the difference is presented as a component of stockholders’ equity. During the three and nine months ended September 30, 2015 and 2014 , the difference between the amount of tax calculated on a stand-alone basis and the amount of tax calculated per the tax sharing agreement was not material. Due To/From Related Parties, Net As a result of the related party transactions with EMC described above, amounts due to and from related parties, net as of September 30, 2015 and December 31, 2014 consisted of the following (table in millions): September 30, December 31, 2015 2014 Due to related parties $ (50 ) $ (76 ) Due from related parties 75 125 Due (to) from related parties, net $ 25 $ 49 Income tax due (to) from related parties $ (36 ) $ (40 ) Balances due to or from related parties, which are unrelated to tax obligations, are generally settled in cash within 60 days of each quarter-end. The timing of the tax payments due to and from related parties is governed by the tax sharing agreement with EMC. Notes Payable to EMC VMware and EMC entered into a note exchange agreement on January 21, 2014 providing for the issuance of three promissory notes in the aggregate principal amount of $1,500 million . The total debt of $1,500 million includes $450 million that was exchanged for the $450 million promissory note issued to EMC in April 2007, as amended and restated in June 2011. The three notes issued may be prepaid without penalty or premium, and outstanding principal is due on the following dates: $680 million due May 1, 2018 , $550 million due May 1, 2020 and $270 million due December 1, 2022 . The notes bear interest, payable quarterly in arrears, at the annual rate of 1.75% . During the three and nine months ended September 30, 2015 , $7 million and $20 million , respectively, of interest expense was recognized. During the three and nine months ended September 30, 2014 , $7 million and $18 million , respectively, of interest expense was recognized. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information VMware operates in one reportable operating segment, thus all required financial segment information can be found in the condensed consolidated financial statements. Operating segments are defined as components of an enterprise about which separate financial information is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and assessing performance. VMware’s chief operating decision maker allocates resources and assesses performance based upon discrete financial information at the consolidated level. Revenues by geographic area for the three and nine months ended September 30, 2015 and 2014 were as follows (table in millions): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 United States $ 861 $ 780 $ 2,364 $ 2,112 International 811 735 2,339 2,221 Total $ 1,672 $ 1,515 $ 4,703 $ 4,333 Revenues by geographic area are based on the ship-to addresses of VMware’s customers. No individual country other than the United States accounted for 10% or more of revenues for the three and nine months ended September 30, 2015 and 2014 . Long-lived assets by geographic area, which primarily include property and equipment, net, as of September 30, 2015 and December 31, 2014 were as follows (table in millions): September 30, December 31, 2015 2014 United States $ 835 $ 801 International 147 117 Total $ 982 $ 918 No individual country other than the United States accounted for 10% or more of these assets as of September 30, 2015 and December 31, 2014 , respectively. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Dell and EMC Merger On October 12, 2015, EMC entered into a merger agreement among EMC, Denali and Dell. Upon closing of the transaction, a portion of the merger consideration that EMC shareholders will receive will include shares of Class V common stock that will be registered with the SEC and issued by Denali. It is expected that approximately 0.111 shares of Class V common stock will be issued for each EMC share and that the Class V common stock will be a publicly traded tracking stock that, upon issuance, will track the performance of an approximately 53% economic interest in the VMware business. The closing of the transactions contemplated by the merger agreement is subject to approval of the EMC shareholders as well as various regulatory approvals. Virtustream On October 20, 2015, VMware and EMC announced their intention to form a new cloud services business (“Virtustream”), jointly owned by VMware and EMC. The proposed new cloud business will bring together VMware vCloud Air, Virtustream's Infrastructure-as-a-Service and certain other EMC assets into one company. VMware's level of ownership in Virtustream, the accounting treatment for the transaction, and the effect the transaction will have on VMware's future financial results have not been determined. |
Overview and Basis of Present21
Overview and Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Unaudited Interim Financial Information The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. In the opinion of management, these unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments and accruals, for a fair statement of VMware’s condensed consolidated results of operations, financial position and cash flows for the periods presented. Results of operations are not necessarily indicative of the results that may be expected for the full year 2015. Certain information and footnote disclosures typically included in annual consolidated financial statements have been condensed or omitted. Accordingly, these unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes included in VMware’s 2014 Annual Report on Form 10-K. As of September 30, 2015 , EMC Corporation (“EMC”) held 81.3% of VMware’s outstanding common stock and 97.5% of the combined voting power of VMware’s outstanding common stock, including 43 million shares of VMware’s Class A common stock and all of VMware’s Class B common stock. VMware is a majority-owned and controlled subsidiary of EMC, and its results of operations and financial position are consolidated with EMC’s financial statements. On October 12, 2015, Dell, Inc. (“Dell”), Denali Holding Inc. (“Denali”) and EMC entered into a definitive agreement under which Denali has agreed to acquire EMC. Refer to Note M for further information. Management believes the assumptions underlying the condensed consolidated financial statements are reasonable. However, the amounts recorded for VMware’s intercompany transactions with EMC may not be considered arm’s length with an unrelated third party. Therefore, the financial statements included herein may not necessarily reflect the results of operations, financial position and cash flows had VMware engaged in such transactions with an unrelated third party during all periods presented. Accordingly, VMware’s historical financial information is not necessarily indicative of what the Company’s results of operations, financial position and cash flows will be in the future if and when VMware contracts at arm’s length with unrelated third parties for the services the Company receives from and provides to EMC. |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include the accounts of VMware and subsidiaries in which VMware has a controlling financial interest. Non-controlling interests are presented as a separate component within total stockholders’ equity and represent the equity and cumulative pro-rata share of the results of operations attributable to the non-controlling interests. Net earnings attributable to the non-controlling interests are included in other income (expense), net on the condensed consolidated statements of income and are not presented separately as the amounts were not material for the periods presented. All intercompany transactions and account balances between VMware and its subsidiaries have been eliminated in consolidation. Transactions with EMC and its subsidiaries are generally settled in cash and are classified on the condensed consolidated statements of cash flows based upon the nature of the underlying transaction. |
Reclassification | Reclassification Certain prior period amounts related to the notes payable to EMC have been reclassified within the financing activities section of the condensed consolidated statements of cash flows. The reclassifications had no effect on total cash flows used in or provided by operating, investing or financing activities as previously reported. |
Use of Accounting Estimates | Use of Accounting Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the reported amounts of revenues and expenses during the reporting periods, and the disclosure of contingent liabilities at the date of the financial statements. Estimates are used for, but not limited to, trade receivable valuation, marketing development funds and rebates, useful lives assigned to fixed assets and intangible assets, valuation of goodwill and definite-lived intangibles, income taxes, stock-based compensation, and contingencies. Actual results could differ from those estimates. |
New Accounting Pronouncement | New Accounting Pronouncement During May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606). The updated revenue standard establishes principles for recognizing revenue and develops a common revenue standard for all industries. Upon adoption, entities will be required to recognize the amount of revenue that they expect to be entitled to for the transfer of promised goods or services to their customers. The updated standard is effective for the Company in the first quarter of 2018 and permits the use of either the retrospective or cumulative effect transition method. Early adoption is permitted, but not earlier than the first quarter of 2017. The Company has not selected a transition method and is currently evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. |
Business Combinations, Defini22
Business Combinations, Definite-Lived Intangible Assets, Net and Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Business Combinations [Abstract] | |
Schedule of Finite-Lived Intangible Assets | As of September 30, 2015 and December 31, 2014 , definite-lived intangible assets consisted of the following (amounts in tables in millions): September 30, 2015 Weighted-Average Gross Carrying Amount Accumulated Amortization Net Book Value Purchased technology 6.6 $ 651 $ (281 ) $ 370 Leasehold interest 34.9 149 (19 ) 130 Customer relationships and customer lists 8.3 151 (60 ) 91 Trademarks and tradenames 8.6 61 (14 ) 47 Other 2.9 20 (13 ) 7 Total definite-lived intangible assets $ 1,032 $ (387 ) $ 645 December 31, 2014 Weighted-Average Gross Carrying Amount Accumulated Amortization Net Book Value Purchased technology 6.5 $ 699 $ (252 ) $ 447 Leasehold interest 34.9 149 (15 ) 134 Customer relationships and customer lists 8.2 157 (53 ) 104 Trademarks and tradenames 8.6 61 (9 ) 52 Other 2.7 18 (7 ) 11 Total definite-lived intangible assets $ 1,084 $ (336 ) $ 748 |
Schedule of Future Amortization Expense | Based on intangible assets recorded as of September 30, 2015 and assuming no subsequent additions or impairment of underlying assets, the remaining estimated annual amortization expense is expected to be as follows (table in millions): Remainder of 2015 $ 35 2016 128 2017 121 2018 108 2019 87 Thereafter 166 Total $ 645 |
Schedule of Goodwill | The following table summarizes the changes in the carrying amount of goodwill during the nine months ended September 30, 2015 (table in millions): Balance, January 1, 2015 $ 3,964 Increase in goodwill related to a business combination 17 Balance, September 30, 2015 $ 3,981 |
Realignment Charges (Tables)
Realignment Charges (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | The following table summarizes the activity for the accrued realignment charges for the nine months ended September 30, 2015 (table in millions): Nine Months Ended September 30, 2015 Balance as of January 1, 2015 Realignment Charges Utilization Balance as of September 30, 2015 Severance-related costs $ 8 $ 20 $ (27 ) $ 1 |
Net Income per Share (Tables)
Net Income per Share (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Computations of Basic and Diluted Net Income per Share | The following table sets forth the computations of basic and diluted net income per share during the three and nine months ended September 30, 2015 and 2014 (net income in millions, shares in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Net income $ 256 $ 194 $ 623 $ 560 Weighted-average shares, basic for Class A and Class B 422,329 430,463 424,799 430,408 Effect of dilutive securities 1,652 3,655 2,667 4,248 Weighted-average shares, diluted for Class A and Class B 423,981 434,118 427,466 434,656 Net income per weighted-average share, basic for Class A and Class B $ 0.61 $ 0.45 $ 1.47 $ 1.30 Net income per weighted-average share, diluted for Class A and Class B $ 0.60 $ 0.45 $ 1.46 $ 1.29 |
Antidilutive Securities Excluded from Computation of Net Income per Share | The following table sets forth the weighted-average common share equivalents of Class A common stock that were excluded from the diluted net income per share calculations during the three and nine months ended September 30, 2015 and 2014 , because their effect would have been anti-dilutive (shares in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Anti-dilutive securities: Employee stock options 2,129 1,180 2,173 1,244 Restricted stock units 365 107 58 37 Total 2,494 1,287 2,231 1,281 |
Cash, Cash Equivalents and In25
Cash, Cash Equivalents and Investments (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Investing in Fixed Income Securities | Cash, cash equivalents and investments as of September 30, 2015 and December 31, 2014 consisted of the following (tables in millions): September 30, 2015 Cost or Amortized Cost Unrealized Gains Unrealized Losses Aggregate Cash $ 770 $ — $ — $ 770 Cash equivalents: Money-market funds $ 1,312 $ — $ — $ 1,312 Municipal obligations 1 — — 1 Total cash equivalents $ 1,313 $ — $ — $ 1,313 Short-term investments: U.S. Government and agency obligations $ 642 $ 3 $ — $ 645 U.S. and foreign corporate debt securities 3,337 5 (8 ) 3,334 Foreign governments and multi-national agency obligations 35 — — 35 Municipal obligations 823 1 — 824 Asset-backed securities 30 — — 30 Mortgage-backed securities 271 — — 271 Total short-term investments $ 5,138 $ 9 $ (8 ) $ 5,139 Other assets: Marketable available-for-sale equity securities $ 15 $ 1 $ — $ 16 December 31, 2014 Cost or Amortized Cost Unrealized Gains Unrealized Losses Aggregate Fair Value Cash $ 885 $ — $ — $ 885 Cash equivalents: Money-market funds $ 1,130 $ — $ — $ 1,130 U.S. and foreign corporate debt securities 54 — — 54 Foreign governments and multi-national agency obligations 2 — — 2 Total cash equivalents $ 1,186 $ — $ — $ 1,186 Short-term investments: U.S. Government and agency obligations $ 542 $ — $ — $ 542 U.S. and foreign corporate debt securities 3,236 3 (5 ) 3,234 Foreign governments and multi-national agency obligations 23 — — 23 Municipal obligations 930 2 — 932 Asset-backed securities 53 — — 53 Mortgage-backed securities 221 — (1 ) 220 Total short-term investments $ 5,005 $ 5 $ (6 ) $ 5,004 |
Unrealized Losses on Cash Equivalents and Investments | Unrealized losses on cash equivalents and investments as of September 30, 2015 and December 31, 2014 , which have been in a net loss position for less than twelve months, were classified by investment category as follows (table in millions): September 30, 2015 December 31, 2014 Fair Value Unrealized Losses Fair Value Unrealized Losses U.S. and foreign corporate debt securities $ 1,545 $ (7 ) $ 1,964 $ (5 ) Mortgage-backed securities 132 (1 ) 107 (1 ) Total $ 1,677 $ (8 ) $ 2,071 $ (6 ) |
Contractual Maturities of Investments | The contractual maturities of short-term investments held at September 30, 2015 consisted of the following (table in millions): Amortized Cost Basis Aggregate Fair Value Due within one year $ 1,592 $ 1,593 Due after 1 year through 5 years 3,243 3,243 Due after 5 years through 10 years 95 95 Due after 10 years 208 208 Total short-term investments $ 5,138 $ 5,139 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Of Money Market Funds, Available-For-Sale Securities, and Foreign Currency Forward Contracts | The following tables set forth the fair value hierarchy of VMware’s money-market funds, available-for-sale securities, and foreign currency forward contracts, that were required to be measured at fair value as of September 30, 2015 and December 31, 2014 (tables in millions): September 30, 2015 Level 1 Level 2 Total Cash equivalents: Money-market funds $ 1,312 $ — $ 1,312 Municipal obligations — 1 1 Total cash equivalents $ 1,312 $ 1 $ 1,313 Short-term investments: U.S. Government and agency obligations $ 472 $ 173 $ 645 U.S. and foreign corporate debt securities — 3,334 3,334 Foreign governments and multi-national agency obligations — 35 35 Municipal obligations — 824 824 Asset-backed securities — 30 30 Mortgage-backed securities — 271 271 Total short-term investments $ 472 $ 4,667 $ 5,139 Other assets: Marketable available-for-sale equity securities $ 16 $ — $ 16 Accrued expenses and other: Foreign currency forward contracts $ — $ (3 ) $ (3 ) December 31, 2014 Level 1 Level 2 Total Cash equivalents: Money-market funds $ 1,130 $ — $ 1,130 U.S. and foreign corporate debt securities — 54 54 Foreign governments and multi-national agency obligations — 2 2 Total cash equivalents $ 1,130 $ 56 $ 1,186 Short-term investments: U.S. Government and agency obligations $ 353 $ 189 $ 542 U.S. and foreign corporate debt securities — 3,234 3,234 Foreign governments and multi-national agency obligations — 23 23 Municipal obligations — 932 932 Asset-backed securities — 53 53 Mortgage-backed securities — 220 220 Total short-term investments $ 353 $ 4,651 $ 5,004 Other current assets: Foreign currency forward contracts $ — $ 1 $ 1 Accrued expenses and other: Foreign currency forward contracts $ — $ (1 ) $ (1 ) |
Unearned Revenues (Tables)
Unearned Revenues (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Deferred Revenue Disclosure [Abstract] | |
Unearned Revenues, by Arrangement | Unearned revenues as of September 30, 2015 and December 31, 2014 consisted of the following (table in millions): September 30, December 31, 2015 2014 Unearned license revenues $ 404 $ 488 Unearned software maintenance revenues 3,850 3,905 Unearned professional services revenues 432 440 Total unearned revenues $ 4,686 $ 4,833 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
Stock Repurchase Programs | The following table summarizes stock repurchase activity during the three and nine months ended September 30, 2015 and 2014 (aggregate purchase price in millions, shares in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Aggregate purchase price $ 200 $ 43 $ 1,050 $ 450 Class A common shares repurchased 2,408 436 12,524 4,691 Weighted-average price per share $ 83.06 $ 98.94 $ 83.84 $ 95.56 The following table summarizes stock repurchase authorization that remains open as of September 30, 2015 (amount in table in millions): Authorization Date Amount Authorized Expiration Date Status January 27, 2015 $1,000 December 31, 2017 Open |
Summary of Stock Option Activity | The following table summarizes stock option activity since January 1, 2015 (shares in thousands): Number of Shares Weighted- Average Exercise Price (per share) Outstanding, January 1, 2015 5,869 $ 50.54 Granted 13 84.68 Forfeited (213 ) 66.83 Exercised (2,289 ) 29.92 Outstanding, September 30, 2015 3,380 63.65 |
Summary of Restricted Stock Activity | The following table summarizes restricted stock activity since January 1, 2015 (units in thousands): Number of Units Weighted- Average Grant Date Fair Value (per unit) Outstanding, January 1, 2015 12,585 $ 88.88 Granted 5,823 86.98 Vested (3,311 ) 92.17 Forfeited (1,382 ) 88.16 Outstanding, September 30, 2015 13,715 87.38 |
Schedule of Accumulated Other Comprehensive Income | The changes in components of accumulated other comprehensive income (loss) during the nine months ended September 30, 2015 and 2014 were as follows (tables in millions): Unrealized Gain on Unrealized Loss on Total Balance, January 1, 2015 $ — $ (1 ) $ (1 ) Unrealized gain (loss), net of taxes of $1, $0 and $1 2 (4 ) (2 ) Balance, September 30, 2015 $ 2 $ (5 ) $ (3 ) Unrealized Gain on Unrealized Loss on Total Balance, January 1, 2014 $ 4 $ — $ 4 Unrealized gain (loss), net of taxes of $1, $0 and $1 2 (3 ) (1 ) Amounts reclassified from accumulated other comprehensive income to the condensed consolidated statement of income, net of taxes of $(2), $0 and $(2) (2 ) — (2 ) Other comprehensive income (loss), net — (3 ) (3 ) Balance, September 30, 2014 $ 4 $ (3 ) $ 1 |
Related Parties (Tables)
Related Parties (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | Information about VMware’s revenues and receipts from such arrangements with EMC during the three and nine months ended September 30, 2015 and 2014 and unearned revenues as of September 30, 2015 and December 31, 2014 consisted of the following (table in millions): Revenues and Receipts from EMC Unearned Revenues from EMC Three Months Ended Nine Months Ended September 30, September 30, September 30, December 31, 2015 2014 2015 2014 2015 2014 Reseller revenues $ 68 $ 47 $ 199 $ 136 $ 256 $ 290 Internal-use revenues 4 4 13 17 11 18 Professional services revenues 20 13 68 53 5 9 Agency fee revenues 1 1 4 4 — — Reimbursement for transition services 2 — 3 1 n/a n/a The following table summarizes these payments made between VMware and EMC during the three and nine months ended September 30, 2015 and 2014 (table in millions): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Payments from VMware to EMC $ — $ — $ 92 $ 20 Information about VMware’s costs from such arrangements with EMC for the three and nine months ended September 30, 2015 and 2014 consisted of the following (table in millions): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Purchases and leases of products and purchases of services $ 14 $ 15 $ 45 $ 48 Collaborative technology project costs 1 3 4 10 EMC subsidiary support and administrative costs 24 31 79 107 As a result of the related party transactions with EMC described above, amounts due to and from related parties, net as of September 30, 2015 and December 31, 2014 consisted of the following (table in millions): September 30, December 31, 2015 2014 Due to related parties $ (50 ) $ (76 ) Due from related parties 75 125 Due (to) from related parties, net $ 25 $ 49 Income tax due (to) from related parties $ (36 ) $ (40 ) |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
Schedule of Revenues by Geographic Area | Revenues by geographic area for the three and nine months ended September 30, 2015 and 2014 were as follows (table in millions): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 United States $ 861 $ 780 $ 2,364 $ 2,112 International 811 735 2,339 2,221 Total $ 1,672 $ 1,515 $ 4,703 $ 4,333 |
Schedule of Long-Lived Assets by Geographic Area | Long-lived assets by geographic area, which primarily include property and equipment, net, as of September 30, 2015 and December 31, 2014 were as follows (table in millions): September 30, December 31, 2015 2014 United States $ 835 $ 801 International 147 117 Total $ 982 $ 918 |
Overview and Basis of Present31
Overview and Basis of Presentation (Basis of Presentation) (Details) - EMC shares in Millions | Sep. 30, 2015shares |
Related Party Transaction [Line Items] | |
Shareholders' interest, outstanding ownership percentage of VMware by EMC | 81.30% |
Combined voting power of VMware's outstanding common stock | 97.50% |
Class A Common Stock | |
Related Party Transaction [Line Items] | |
VMware's outstanding common stock held by EMC (shares) | 43 |
Business Combinations, Defini32
Business Combinations, Definite-Lived Intangible Assets, Net and Goodwill (Business Combinations) (Details) - USD ($) $ in Millions | Feb. 02, 2015 | Sep. 30, 2015 |
Business Acquisition [Line Items] | ||
Increase in goodwill related to a business combination | $ 17 | |
Immidio B.V. | ||
Business Acquisition [Line Items] | ||
Payments to Acquire Businesses, Gross | $ 21 | |
Finite-lived Intangible Assets Acquired | 8 | |
Increase in goodwill related to a business combination | $ 17 |
Business Combinations, Defini33
Business Combinations, Definite-Lived Intangible Assets, Net and Goodwill (Intangible Assets Detail) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Gross Carrying Amount | $ 1,032 | $ 1,032 | $ 1,084 | ||
Accumulated Amortization | (387) | (387) | (336) | ||
Net Book Value | 645 | 645 | $ 748 | ||
Amortization Expense | 36 | $ 37 | $ 110 | $ 104 | |
Purchased technology | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Weighted-Average Useful Lives (in years) | 6 years 7 months 6 days | 6 years 5 months 25 days | |||
Gross Carrying Amount | 651 | $ 651 | $ 699 | ||
Accumulated Amortization | (281) | (281) | (252) | ||
Net Book Value | 370 | $ 370 | $ 447 | ||
Leasehold interest | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Weighted-Average Useful Lives (in years) | 34 years 10 months 24 days | 34 years 10 months 24 days | |||
Gross Carrying Amount | 149 | $ 149 | $ 149 | ||
Accumulated Amortization | (19) | (19) | (15) | ||
Net Book Value | 130 | $ 130 | $ 134 | ||
Customer relationships and customer lists | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Weighted-Average Useful Lives (in years) | 8 years 3 months 18 days | 8 years 2 months 13 days | |||
Gross Carrying Amount | 151 | $ 151 | $ 157 | ||
Accumulated Amortization | (60) | (60) | (53) | ||
Net Book Value | 91 | $ 91 | $ 104 | ||
Trademarks and tradenames | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Weighted-Average Useful Lives (in years) | 8 years 7 months 6 days | 8 years 7 months 15 days | |||
Gross Carrying Amount | 61 | $ 61 | $ 61 | ||
Accumulated Amortization | (14) | (14) | (9) | ||
Net Book Value | 47 | $ 47 | $ 52 | ||
Other | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Weighted-Average Useful Lives (in years) | 2 years 10 months 24 days | 2 years 8 months 21 days | |||
Gross Carrying Amount | 20 | $ 20 | $ 18 | ||
Accumulated Amortization | (13) | (13) | (7) | ||
Net Book Value | $ 7 | $ 7 | $ 11 |
Business Combinations, Defini34
Business Combinations, Definite-Lived Intangible Assets, Net and Goodwill (Amortization of Intangible Assets) (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Business Combinations [Abstract] | ||
Remainder of 2015 | $ 35 | |
2,016 | 128 | |
2,017 | 121 | |
2,018 | 108 | |
2,019 | 87 | |
Thereafter | 166 | |
Net Book Value | $ 645 | $ 748 |
Business Combinations, Defini35
Business Combinations, Definite-Lived Intangible Assets, Net and Goodwill (Changes In Carrying Amount Of Goodwill) (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Goodwill [Roll Forward] | |
Balance, January 1, 2015 | $ 3,964 |
Increase in goodwill related to a business combination | 17 |
Balance, September 30, 2015 | $ 3,981 |
Realignment Charges (Narrative)
Realignment Charges (Narrative) (Details) $ in Millions | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2015USD ($) | Mar. 31, 2015Position | Sep. 30, 2014USD ($)Position | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) | ||
Restructuring Cost and Reserve [Line Items] | |||||||
Number of positions eliminated | Position | 350 | 90 | |||||
Realignment Charges | [1] | $ 0 | $ 6 | $ 20 | $ 4 | ||
Employee Severance | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Realignment Charges | 20 | $ 7 | |||||
Restructuring Reserve | $ 1 | $ 1 | $ 8 | ||||
[1] | Includes stock-based compensation as follows: Cost of license revenues $0 $1 $1 $2, Cost of services revenues $11 $11 $32 $31, Research and development $56 $61 $164 $187, Sales and marketing $43 $43 $124 $128, General and administrative $16 $17 $47 $51. |
Realignment Charges (Schedule o
Realignment Charges (Schedule of Restructuring Reserve) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Restructuring Reserve [Roll Forward] | |||||
Realignment Charges | [1] | $ 0 | $ 6 | $ 20 | $ 4 |
Employee Severance | |||||
Restructuring Reserve [Roll Forward] | |||||
Restructuring Reserve, Beginning of Period | 8 | ||||
Realignment Charges | 20 | $ 7 | |||
Utilization | (27) | ||||
Restructuring Reserve, End of Period | $ 1 | $ 1 | |||
[1] | Includes stock-based compensation as follows: Cost of license revenues $0 $1 $1 $2, Cost of services revenues $11 $11 $32 $31, Research and development $56 $61 $164 $187, Sales and marketing $43 $43 $124 $128, General and administrative $16 $17 $47 $51. |
Net Income per Share (Computati
Net Income per Share (Computations Of Basic And Diluted Net Income Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 256 | $ 194 | $ 623 | $ 560 |
Weighted-average shares, basic for Class A and Class B | 422,329 | 430,463 | 424,799 | 430,408 |
Effect of dilutive securities | 1,652 | 3,655 | 2,667 | 4,248 |
Weighted-average shares, diluted for Class A and Class B | 423,981 | 434,118 | 427,466 | 434,656 |
Net income per weighted-average share, basic for Class A and Class B (USD per share) | $ 0.61 | $ 0.45 | $ 1.47 | $ 1.30 |
Net income per weighted-average share, diluted for Class A and Class B (USD per share) | $ 0.60 | $ 0.45 | $ 1.46 | $ 1.29 |
Net Income per Share (Anti-Dilu
Net Income per Share (Anti-Dilutive Shares Excluded From Net Income) (Details) - Class A Common Stock - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,494 | 1,287 | 2,231 | 1,281 |
Stock Options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,129 | 1,180 | 2,173 | 1,244 |
Restricted Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 365 | 107 | 58 | 37 |
Cash, Cash Equivalents and In40
Cash, Cash Equivalents and Investments (Investing In Fixed Income Securities) (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Dec. 31, 2013 |
Schedule of Investments [Line Items] | ||||
Cash and Cash Equivalents, cost or amortized cost | $ 2,083 | $ 2,071 | $ 2,293 | $ 2,305 |
Short-term investments, cost or amortized cost | 5,138 | 5,005 | ||
Short-term investments, unrealized gains | 9 | 5 | ||
Short-term investments, unrealized losses | (8) | (6) | ||
Short-term investments, aggregate fair value | 5,139 | 5,004 | ||
U.S. Government and agency obligations | ||||
Schedule of Investments [Line Items] | ||||
Short-term investments, cost or amortized cost | 642 | 542 | ||
Short-term investments, unrealized gains | 3 | 0 | ||
Short-term investments, unrealized losses | 0 | 0 | ||
Short-term investments, aggregate fair value | 645 | 542 | ||
U.S. and foreign corporate debt securities | ||||
Schedule of Investments [Line Items] | ||||
Short-term investments, cost or amortized cost | 3,337 | 3,236 | ||
Short-term investments, unrealized gains | 5 | 3 | ||
Short-term investments, unrealized losses | (8) | (5) | ||
Short-term investments, aggregate fair value | 3,334 | 3,234 | ||
Foreign governments and multi-national agency obligations | ||||
Schedule of Investments [Line Items] | ||||
Short-term investments, cost or amortized cost | 35 | 23 | ||
Short-term investments, unrealized gains | 0 | 0 | ||
Short-term investments, unrealized losses | 0 | 0 | ||
Short-term investments, aggregate fair value | 35 | 23 | ||
Municipal obligations | ||||
Schedule of Investments [Line Items] | ||||
Short-term investments, cost or amortized cost | 823 | 930 | ||
Short-term investments, unrealized gains | 1 | 2 | ||
Short-term investments, unrealized losses | 0 | 0 | ||
Short-term investments, aggregate fair value | 824 | 932 | ||
Asset-backed securities | ||||
Schedule of Investments [Line Items] | ||||
Short-term investments, cost or amortized cost | 30 | 53 | ||
Short-term investments, unrealized gains | 0 | 0 | ||
Short-term investments, unrealized losses | 0 | 0 | ||
Short-term investments, aggregate fair value | 30 | 53 | ||
Mortgage-backed securities | ||||
Schedule of Investments [Line Items] | ||||
Short-term investments, cost or amortized cost | 271 | 221 | ||
Short-term investments, unrealized gains | 0 | 0 | ||
Short-term investments, unrealized losses | 0 | (1) | ||
Short-term investments, aggregate fair value | 271 | 220 | ||
Cash | ||||
Schedule of Investments [Line Items] | ||||
Cash and Cash Equivalents, cost or amortized cost | 770 | 885 | ||
Cash and cash equivalents, unrealized gains | 0 | 0 | ||
Cash and cash equivalents, unrealized losses | 0 | 0 | ||
Cash and cash equivalents, aggregate fair value | 770 | 885 | ||
Money-market funds | ||||
Schedule of Investments [Line Items] | ||||
Cash and Cash Equivalents, cost or amortized cost | 1,312 | 1,130 | ||
Cash and cash equivalents, unrealized gains | 0 | 0 | ||
Cash and cash equivalents, unrealized losses | 0 | 0 | ||
Cash and cash equivalents, aggregate fair value | 1,312 | 1,130 | ||
U.S. and foreign corporate debt securities | ||||
Schedule of Investments [Line Items] | ||||
Cash and Cash Equivalents, cost or amortized cost | 54 | |||
Cash and cash equivalents, unrealized gains | 0 | |||
Cash and cash equivalents, unrealized losses | 0 | |||
Cash and cash equivalents, aggregate fair value | 54 | |||
Municipal obligations | ||||
Schedule of Investments [Line Items] | ||||
Cash and Cash Equivalents, cost or amortized cost | 1 | |||
Cash and cash equivalents, unrealized gains | 0 | |||
Cash and cash equivalents, unrealized losses | 0 | |||
Cash and cash equivalents, aggregate fair value | 1 | |||
Foreign governments and multi-national agency obligations | ||||
Schedule of Investments [Line Items] | ||||
Cash and Cash Equivalents, cost or amortized cost | 2 | |||
Cash and cash equivalents, unrealized gains | 0 | |||
Cash and cash equivalents, unrealized losses | 0 | |||
Cash and cash equivalents, aggregate fair value | 2 | |||
Total cash equivalents | ||||
Schedule of Investments [Line Items] | ||||
Cash and Cash Equivalents, cost or amortized cost | 1,313 | 1,186 | ||
Cash and cash equivalents, unrealized gains | 0 | 0 | ||
Cash and cash equivalents, unrealized losses | 0 | 0 | ||
Cash and cash equivalents, aggregate fair value | 1,313 | $ 1,186 | ||
Other Assets | ||||
Schedule of Investments [Line Items] | ||||
Marketable available-for-sale equity securities, amortized cost | 15 | |||
Marketable available-for-sale equity securities, unrealized gains | 1 | |||
Marketable available-for-sale equity securities, unrealized losses | 0 | |||
Marketable available-for-sale equity securities, aggregate fair value | $ 16 |
Cash, Cash Equivalents and In41
Cash, Cash Equivalents and Investments (Unrealized Losses On Cash Equivalents and Investments) (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Schedule of Investments [Line Items] | ||
Fair Value | $ 1,677 | $ 2,071 |
Unrealized Losses | (8) | (6) |
U.S. and foreign corporate debt securities | ||
Schedule of Investments [Line Items] | ||
Fair Value | 1,545 | 1,964 |
Unrealized Losses | (7) | (5) |
Mortgage-backed securities | ||
Schedule of Investments [Line Items] | ||
Fair Value | 132 | 107 |
Unrealized Losses | $ (1) | $ (1) |
Cash, Cash Equivalents and In42
Cash, Cash Equivalents and Investments (Contractual Maturities) (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Amortized Cost Basis | ||
Due within one year | $ 1,592 | |
Due after 1 year through 5 years | 3,243 | |
Due after 5 years through 10 years | 95 | |
Due after 10 years | 208 | |
Short-term investments, cost or amortized cost | 5,138 | $ 5,005 |
Aggregate Fair Value | ||
Due within one year | 1,593 | |
Due after 1 year through 5 years | 3,243 | |
Due after 5 years through 10 years | 95 | |
Due after 10 years | 208 | |
Short-term investments, aggregate fair value | $ 5,139 | $ 5,004 |
Fair Value Measurements (Fair V
Fair Value Measurements (Fair Value Hierarchy) (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | $ 5,139 | $ 5,004 |
Other Assets | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Marketable available-for-sale equity securities | 16 | |
Deferred Compensation Plan Assets | 18 | 8 |
Notes payable to EMC | Notes payable | EMC | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt Instrument | 1,499 | 1,503 |
Other Liabilities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Deferred Compensation Plan Liabilities | 18 | 8 |
U.S. Government and agency obligations | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 645 | 542 |
U.S. and foreign corporate debt securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 3,334 | 3,234 |
Foreign governments and multi-national agency obligations | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 35 | 23 |
Municipal obligations | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 824 | 932 |
Asset-backed securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 30 | 53 |
Mortgage-backed securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 271 | 220 |
Fair Value, Measurements, Recurring | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 5,139 | 5,004 |
Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 472 | 353 |
Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 4,667 | 4,651 |
Fair Value, Measurements, Recurring | Other Assets | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Marketable available-for-sale equity securities | 16 | |
Fair Value, Measurements, Recurring | Other Assets | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Marketable available-for-sale equity securities | 16 | |
Fair Value, Measurements, Recurring | Other Assets | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Marketable available-for-sale equity securities | 0 | |
Fair Value, Measurements, Recurring | Accrued expense and other | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign currency forward contracts, liability | (3) | (1) |
Fair Value, Measurements, Recurring | Accrued expense and other | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign currency forward contracts, liability | 0 | 0 |
Fair Value, Measurements, Recurring | Accrued expense and other | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign currency forward contracts, liability | (3) | (1) |
Fair Value, Measurements, Recurring | Other current assets | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign currency forward contracts, asset | 1 | |
Fair Value, Measurements, Recurring | Other current assets | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign currency forward contracts, asset | 0 | |
Fair Value, Measurements, Recurring | Other current assets | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Foreign currency forward contracts, asset | 1 | |
Fair Value, Measurements, Recurring | U.S. Government and agency obligations | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 645 | 542 |
Fair Value, Measurements, Recurring | U.S. Government and agency obligations | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 472 | 353 |
Fair Value, Measurements, Recurring | U.S. Government and agency obligations | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 173 | 189 |
Fair Value, Measurements, Recurring | U.S. and foreign corporate debt securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 3,334 | 3,234 |
Fair Value, Measurements, Recurring | U.S. and foreign corporate debt securities | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 0 | 0 |
Fair Value, Measurements, Recurring | U.S. and foreign corporate debt securities | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 3,334 | 3,234 |
Fair Value, Measurements, Recurring | Foreign governments and multi-national agency obligations | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 35 | 23 |
Fair Value, Measurements, Recurring | Foreign governments and multi-national agency obligations | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 0 | 0 |
Fair Value, Measurements, Recurring | Foreign governments and multi-national agency obligations | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 35 | 23 |
Fair Value, Measurements, Recurring | Municipal obligations | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 824 | 932 |
Fair Value, Measurements, Recurring | Municipal obligations | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 0 | 0 |
Fair Value, Measurements, Recurring | Municipal obligations | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 824 | 932 |
Fair Value, Measurements, Recurring | Asset-backed securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 30 | 53 |
Fair Value, Measurements, Recurring | Asset-backed securities | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 0 | 0 |
Fair Value, Measurements, Recurring | Asset-backed securities | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 30 | 53 |
Fair Value, Measurements, Recurring | Mortgage-backed securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 271 | 220 |
Fair Value, Measurements, Recurring | Mortgage-backed securities | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 0 | 0 |
Fair Value, Measurements, Recurring | Mortgage-backed securities | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term investments: | 271 | 220 |
Money-market funds | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 1,312 | 1,130 |
Money-market funds | Fair Value, Measurements, Recurring | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 1,312 | 1,130 |
Money-market funds | Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 1,312 | 1,130 |
Money-market funds | Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 0 | 0 |
Municipal obligations | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 1 | |
Municipal obligations | Fair Value, Measurements, Recurring | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 1 | |
Municipal obligations | Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 0 | |
Municipal obligations | Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 1 | |
U.S. and foreign corporate debt securities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 54 | |
U.S. and foreign corporate debt securities | Fair Value, Measurements, Recurring | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 54 | |
U.S. and foreign corporate debt securities | Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 0 | |
U.S. and foreign corporate debt securities | Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 54 | |
Foreign governments and multi-national agency obligations | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 2 | |
Foreign governments and multi-national agency obligations | Fair Value, Measurements, Recurring | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 2 | |
Foreign governments and multi-national agency obligations | Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 0 | |
Foreign governments and multi-national agency obligations | Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 2 | |
Total cash equivalents | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 1,313 | 1,186 |
Total cash equivalents | Fair Value, Measurements, Recurring | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 1,313 | 1,186 |
Total cash equivalents | Fair Value, Measurements, Recurring | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | 1,312 | 1,130 |
Total cash equivalents | Fair Value, Measurements, Recurring | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents: | $ 1 | $ 56 |
Fair Value Measurements Assets
Fair Value Measurements Assets Measured and Recorded at Fair Value on a Non-Recurring Basis (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2015 | Dec. 31, 2014 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Impairment of strategic investment | $ 5 | $ 5 | |
Other Assets | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Strategic Investments | $ 100 | $ 100 | $ 110 |
Derivatives and Hedging Activ45
Derivatives and Hedging Activities (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Derivatives, Fair Value [Line Items] | |||||
Net loss on foreign currency forward contracts and underlying foreign currency denominated assets and liabilities | $ 1 | $ 3 | $ 10 | $ 4 | |
Foreign exchange forward contract not designated as a hedging instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Gain (loss) on foreign currency derivative instruments not designated as hedging instruments | 12 | $ 29 | $ 33 | $ 24 | |
Not Designated As Hedging Instrument | Foreign exchange forward contract not designated as a hedging instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Maturity of derivatives | 1 month | ||||
Notional amount of foreign currency derivative instruments | 511 | $ 511 | $ 697 | ||
Cash Flow Hedging | Designated As Hedging Instrument | Foreign exchange forward contract not designated as a hedging instrument | |||||
Derivatives, Fair Value [Line Items] | |||||
Maturity of derivatives | 12 months | ||||
Notional amount of foreign currency derivative instruments | $ 64 | $ 64 | $ 240 |
Unearned Revenues (Summary of U
Unearned Revenues (Summary of Unearned Revenues) (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2014 | |
Unearned Revenue Arrangement [Line Items] | ||
Unearned revenues | $ 4,686 | $ 4,833 |
Unearned license revenues | ||
Unearned Revenue Arrangement [Line Items] | ||
Unearned revenues | 404 | 488 |
Unearned software maintenance revenues | ||
Unearned Revenue Arrangement [Line Items] | ||
Unearned revenues | $ 3,850 | 3,905 |
Unearned software maintenance revenues | Weighted Average | ||
Unearned Revenue Arrangement [Line Items] | ||
Revenue recognition term | 1 year 10 months 24 days | |
Unearned professional services revenues | ||
Unearned Revenue Arrangement [Line Items] | ||
Unearned revenues | $ 432 | $ 440 |
Contingencies (Narrative) (Deta
Contingencies (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Jun. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Loss Contingencies [Line Items] | |||||
GSA settlement | $ 0 | $ 0 | $ (76) | $ 0 | |
General Services Administration (GSA) | |||||
Loss Contingencies [Line Items] | |||||
GSA settlement | $ 76 |
Stockholders' Equity (Stock Rep
Stockholders' Equity (Stock Repurchase Program) (Details) - Class A Common Stock - USD ($) $ / shares in Units, shares in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Jan. 27, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Authorized amount remaining for repurchase | $ 910,000,000 | $ 910,000,000 | |||
January 2015 Stock Repurchase Program | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Authorized repurchase amount under stock repurchase program | $ 1,000,000,000 | ||||
VMware Share Repurchase Programs | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Aggregate purchase price | $ 200,000,000 | $ 43,000,000 | $ 1,050,000,000 | $ 450,000,000 | |
Class A common shares repurchased (shares) | 2,408 | 436 | 12,524 | 4,691 | |
Weighted-average price per share | $ 83.06 | $ 98.94 | $ 83.84 | $ 95.56 |
Stockholders' Equity (Summary o
Stockholders' Equity (Summary of Stock Option Activity) (Details) - Class A Common Stock $ / shares in Units, shares in Thousands, $ in Millions | 9 Months Ended |
Sep. 30, 2015USD ($)$ / sharesshares | |
Number of Shares | |
Outstanding, Beginning balance (shares) | 5,869 |
Granted (shares) | 13 |
Forfeited (shares) | (213) |
Exercised (shares) | (2,289) |
Outstanding, Ending balance (shares) | 3,380 |
Weighted-Average Exercise Price | |
Outstanding, Beginning balance (USD per share) | $ / shares | $ 50.54 |
Granted (USD per share) | $ / shares | 84.68 |
Forfeited (USD per share) | $ / shares | 66.83 |
Exercised (USD per share) | $ / shares | 29.92 |
Outstanding, Ending balance (USD per share) | $ / shares | $ 63.65 |
Aggregate intrinsic value of stock options outstanding | $ | $ 74 |
Stockholders' Equity (Summary50
Stockholders' Equity (Summary Of Restricted Stock Activity) (Details) $ / shares in Units, shares in Thousands, $ in Millions | 9 Months Ended |
Sep. 30, 2015USD ($)$ / sharesshares | |
Weighted-Average Grant Date Fair Value | |
Unrecognized compensation cost for stock options and restricted stock | $ | $ 909 |
Weighted-average remaining recognition period | 1 year 6 months |
Restricted Stock | Class A Common Stock | |
Number of Units | |
Outstanding, number of shares | 12,585 |
Granted, number of shares | 5,823 |
Vested, number of shares | (3,311) |
Forfeited, number of shares | (1,382) |
Outstanding, number of shares | 13,715 |
Weighted-Average Grant Date Fair Value | |
Outstanding, weighted-average grant date fair value (USD per share) | $ / shares | $ 88.88 |
Granted, weighted-average grant date fair value (USD per share) | $ / shares | 86.98 |
Vested, weighted-average grant date fair value (USD per share) | $ / shares | 92.17 |
Forfeited, weighted-average grant date fair value (USD per share) | $ / shares | 88.16 |
Outstanding, weighted-average grant date fair value (USD per share) | $ / shares | $ 87.38 |
Fair value of restricted stock-based awards, vested | $ | $ 281 |
Aggregate intrinsic value | $ | $ 1,081 |
Minimum | Performance Stock Units (PSUs) | Class A Common Stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance stock units to Class A common stock, conversion ratio | 0.5 |
Maximum | Performance Stock Units (PSUs) | Class A Common Stock | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance stock units to Class A common stock, conversion ratio | 2 |
Stockholders' Equity (Accumulat
Stockholders' Equity (Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Total stockholders' equity, beginning of period | $ 7,586 | |||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (2) | $ (1) | ||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (2) | |||
Total other comprehensive income (loss) | $ 0 | $ (8) | (2) | (3) |
Total stockholders' equity, end of period | 7,534 | 7,534 | ||
Other Comprehensive Income (Loss) before Reclassifications, Tax [Abstract] | ||||
Tax effect on unrealized gains (losses) on available-for-sale securities | 1 | (2) | 1 | 1 |
Tax effect on unrealized gains (losses) on effective foreign currency forward contracts | 0 | 0 | 0 | 0 |
Tax effect on unrealized gains (losses) | 1 | 1 | ||
Reclassification from AOCI, Current Period, Tax [Abstract] | ||||
Tax effect on reclassification of (gains) losses on available-for-sale securities realized during the period | 0 | (1) | 0 | (2) |
Tax effect on reclassification of (gains) losses on effective foreign currency forward contracts realized during the period | 0 | 0 | 0 | 0 |
Tax effect on reclassification of (gains) losses realized during the period | (2) | |||
Unrealized Gain on Available-for-Sale Securities | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Total stockholders' equity, beginning of period | 0 | 4 | ||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | 2 | 2 | ||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | (2) | |||
Total other comprehensive income (loss) | 0 | |||
Total stockholders' equity, end of period | 2 | 4 | 2 | 4 |
Unrealized Loss on Cash Flow Hedges | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Total stockholders' equity, beginning of period | (1) | 0 | ||
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax | (4) | (3) | ||
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | 0 | |||
Total other comprehensive income (loss) | (3) | |||
Total stockholders' equity, end of period | (5) | (3) | (5) | (3) |
AOCI Attributable to Parent | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Total stockholders' equity, beginning of period | (1) | 4 | ||
Total stockholders' equity, end of period | $ (3) | $ 1 | $ (3) | $ 1 |
Related Parties (Schedule of Re
Related Parties (Schedule of Related Party Transactions) (Details) - EMC - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Reseller revenues | |||||
Related Party Transaction [Line Items] | |||||
Revenue from related party | $ 68 | $ 47 | $ 199 | $ 136 | |
Unearned revenues | 256 | 256 | $ 290 | ||
Internal-use revenues | |||||
Related Party Transaction [Line Items] | |||||
Revenue from related party | 4 | 4 | 13 | 17 | |
Unearned revenues | 11 | 11 | 18 | ||
Professional services revenues | |||||
Related Party Transaction [Line Items] | |||||
Revenue from related party | 20 | 13 | 68 | 53 | |
Unearned revenues | 5 | 5 | 9 | ||
Agency fee revenues | |||||
Related Party Transaction [Line Items] | |||||
Revenue from related party | 1 | 1 | 4 | 4 | |
Unearned revenues | 0 | 0 | $ 0 | ||
Reimbursement for transition services | |||||
Related Party Transaction [Line Items] | |||||
Revenue from related party | 2 | 0 | 3 | 1 | |
Purchases and leases of products and purchases of services | |||||
Related Party Transaction [Line Items] | |||||
Related party costs | 14 | 15 | 45 | 48 | |
Collaborative technology project costs | |||||
Related Party Transaction [Line Items] | |||||
Related party costs | 1 | 3 | 4 | 10 | |
EMC subsidiary support and administrative costs | |||||
Related Party Transaction [Line Items] | |||||
Related party costs | 24 | 31 | 79 | 107 | |
Purchases of products through channel | |||||
Related Party Transaction [Line Items] | |||||
Related party costs | $ 7 | $ 7 | $ 33 | $ 18 |
Related Parties (Tax Sharing Ag
Related Parties (Tax Sharing Agreement) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Related Party Transaction [Line Items] | ||||
Cash paid for taxes, net | $ 155 | $ 65 | ||
EMC | Tax Sharing Agreement | ||||
Related Party Transaction [Line Items] | ||||
Cash paid for taxes, net | $ 0 | $ 0 | $ 92 | $ 20 |
Related Parties (Due To_From Re
Related Parties (Due To/From Related Parties) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2014 | Sep. 30, 2015 | |
Related Party Transaction [Line Items] | |||
Related party transaction, other than tax obligation due to or from related party, cash settlement period | 60 days | ||
EMC | |||
Related Party Transaction [Line Items] | |||
Due to related parties | $ (50) | $ (76) | $ (50) |
Due from related parties | 75 | 125 | 75 |
Due (to) from related parties, net | 25 | 49 | $ 25 |
Income tax due (to) from related parties | $ (36) | $ (40) |
Related Parties (Note Payable t
Related Parties (Note Payable to EMC) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | Jan. 21, 2014 | |
Related Party Transaction [Line Items] | ||||||
Notes payable to EMC | $ 1,500 | $ 1,500 | $ 1,500 | |||
Interest Expense, Related Party | $ 7 | $ 7 | $ 20 | $ 18 | ||
EMC | ||||||
Related Party Transaction [Line Items] | ||||||
Notes payable to EMC | $ 450 | |||||
Notes payable | EMC | ||||||
Related Party Transaction [Line Items] | ||||||
Principal amount | 1,500 | |||||
Note, May 2018 | Notes payable | EMC | ||||||
Related Party Transaction [Line Items] | ||||||
Principal amount | $ 680 | |||||
Interest rate | 1.75% | |||||
Note, May 2020 | Notes payable | EMC | ||||||
Related Party Transaction [Line Items] | ||||||
Principal amount | $ 550 | |||||
Interest rate | 1.75% | |||||
Note, December 2022 | Notes payable | EMC | ||||||
Related Party Transaction [Line Items] | ||||||
Principal amount | $ 270 | |||||
Interest rate | 1.75% |
Segment Information (Schedule O
Segment Information (Schedule Of Revenues By Geographic Area) (Details) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)segment | Sep. 30, 2014USD ($) | |
Revenues From External Customers And Long-Lived Assets [Line Items] | ||||
Number of reportable segments | segment | 1 | |||
Revenues | $ 1,672 | $ 1,515 | $ 4,703 | $ 4,333 |
United States | ||||
Revenues From External Customers And Long-Lived Assets [Line Items] | ||||
Revenues | 861 | 780 | 2,364 | 2,112 |
International | ||||
Revenues From External Customers And Long-Lived Assets [Line Items] | ||||
Revenues | $ 811 | $ 735 | $ 2,339 | $ 2,221 |
Segment Information (Schedule57
Segment Information (Schedule Of Long-Lived Assets By Geographic Area) (Details) - USD ($) $ in Millions | Sep. 30, 2015 | Dec. 31, 2014 |
Revenues From External Customers And Long-Lived Assets [Line Items] | ||
Long-lived assets by geographic area | $ 982 | $ 918 |
United States | ||
Revenues From External Customers And Long-Lived Assets [Line Items] | ||
Long-lived assets by geographic area | 835 | 801 |
International | ||
Revenues From External Customers And Long-Lived Assets [Line Items] | ||
Long-lived assets by geographic area | $ 147 | $ 117 |
Subsequent Events (Details)
Subsequent Events (Details) - Class V - EMC Corp - Denali Holding Inc. - Subsequent Event | Oct. 12, 2015 |
Subsequent Event [Line Items] | |
Shares of Denali issued for EMC share (shares) | 0.111 |
Expected value of VMware stock represented by Class V shares | 0.53 |