EMC 10-Q 6 Nov 09 2009 Q3 Quarterly report Financial data

Statement Of Financial Position

Statement Of Financial Position Classified (USD $)
In Thousands	9 Months Ended Sep. 30, 2009	9 Months Ended Dec. 31, 2008
Current assets:
Cash and cash equivalents	$5,518,359	$5,843,685
Short-term investments	617,535	963,292
Accounts and notes receivable, less allowance for doubtful accounts of $50,500 and $48,080	1,864,121	2,252,640
Inventories	810,925	842,803
Deferred income taxes	486,463	477,101
Other current assets	331,162	285,508
Total current assets	9,628,565	10,665,029
Long-term investments	2,291,672	2,370,493
Property, plant and equipment, net	2,218,632	2,223,007
Intangible assets, net	1,245,447	795,616
Other assets, net	944,703	773,631
Goodwill	9,222,725	7,046,799
Total assets	25,551,744	23,874,575
Current liabilities:
Accounts payable	819,204	757,405
Accrued expenses	1,864,892	1,901,884
Securities lending payable	0	412,321
Income taxes payable	13,378	136,802
Deferred revenue	2,220,602	2,010,024
Total current liabilities	4,918,076	5,218,436
Income taxes payable	241,506	255,182
Deferred revenue	1,257,876	1,182,360
Deferred income taxes	582,633	389,787
Long-term convertible debt	3,072,505	2,991,943
Other liabilities	212,880	180,917
Total liabilities	10,285,476	10,218,625
Commitments and contingencies (see Note 13)	-	-
EMC Corporation's shareholders' equity:
Preferred stock, par value $0.01; authorized 25,000 shares; none outstanding	0	0
Common stock, par value $0.01; authorized 6,000,000 shares; issued and outstanding 2,039,822 and 2,012,938 shares	20,398	20,129
Additional paid-in capital	3,536,678	2,817,054
Retained earnings	11,368,693	10,671,212
Accumulated other comprehensive loss, net	(118,369)	(179,952)
Total EMC Corporation's shareholders' equity	14,807,400	13,328,443
Non-controlling interest in VMware, Inc.	458,868	327,507
Total shareholders' equity	15,266,268	13,655,950
Total liabilities and shareholders' equity	$25,551,744	$23,874,575

1_Statement Of Financial Positi

Statement Of Financial Position Classified (Parenthetical) (USD $)
In Thousands, except Per Share data	Sep. 30, 2009	Dec. 31, 2008
Accounts and notes receivable, allowance for doubtful accounts	$50,500	$48,080
Preferred stock, par value	0.01	0.01
Preferred stock, authorized	25,000	25,000
Preferred stock, outstanding	0	0
Common stock, par value	0.01	0.01
Common stock, authorized	6,000,000	6,000,000
Common stock, issued	2,039,822	2,012,938
Common stock, outstanding	2,039,822	2,012,938

Statement Of Income Alternative

Statement Of Income Alternative (USD $)
In Thousands, except Per Share data	3 Months Ended Sep. 30, 2009	3 Months Ended Sep. 30, 2008	9 Months Ended Sep. 30, 2009	9 Months Ended Sep. 30, 2008
Revenues:
Product sales	$2,200,581	$2,492,941	$6,174,971	$7,295,022
Services	1,317,049	1,222,651	3,750,773	3,564,503
Revenues, Total	3,517,630	3,715,592	9,925,744	10,859,525
Costs and expenses:
Cost of product sales	1,107,400	1,156,063	3,177,935	3,350,199
Cost of services	470,013	500,809	1,380,559	1,512,641
Research and development	422,092	410,793	1,203,266	1,286,809
Selling, general and administrative	1,177,775	1,172,579	3,253,752	3,390,468
In-process research and development	0	0	0	79,204
Restructuring and acquisition-related charges	34,781	4,398	83,587	4,041
Operating income	305,569	470,950	826,645	1,236,163
Investment income	38,106	56,717	109,293	192,587
Interest expense	(46,227)	(44,501)	(135,928)	(131,614)
Other income (expense), net	28,022	(13,313)	17,281	(20,887)
Income before provision for income taxes	325,470	469,853	817,291	1,276,249
Income tax provision	20,602	63,309	96,462	244,060
Net income	304,868	406,544	720,829	1,032,189
Less: Net income attributable to the non-controlling interest in VMware, Inc.	(6,688)	(13,133)	(23,348)	(27,007)
Net income attributable to EMC Corporation	$298,180	$393,411	$697,481	$1,005,182
Net income per weighted average share, basic attributable to EMC Corporation common shareholders	0.15	0.19	0.35	0.49
Net income per weighted average share, diluted attributable to EMC Corporation common shareholders	0.14	0.19	0.34	0.48
Weighted average shares, basic	2,027,347	2,048,594	2,015,920	2,060,952
Weighted average shares, diluted	2,065,951	2,077,474	2,038,984	2,095,116

Statement Of Cash Flows Indirec

Statement Of Cash Flows Indirect (USD $)
In Thousands	9 Months Ended Sep. 30, 2009	9 Months Ended Sep. 30, 2008
Cash flows from operating activities:
Cash received from customers	$10,600,727	$11,437,259
Cash paid to suppliers and employees	(8,098,216)	(8,842,798)
Dividends and interest received	95,024	192,651
Interest paid	(39,550)	(55,270)
Income taxes paid	(232,257)	(233,500)
Net cash provided by operating activities	2,325,728	2,498,342
Cash flows from investing activities:
Additions to property, plant and equipment	(277,589)	(490,066)
Capitalized software development costs	(222,432)	(209,441)
Purchases of short and long-term available for sale securities	(4,224,872)	(2,200,508)
Sales and maturities of short and long-term available for sale securities	4,880,173	2,766,087
Acquisitions, net of cash acquired	(2,664,141)	(678,218)
Increase in strategic and other related investments	(152,667)	(4,410)
Net cash used in investing activities	(2,661,528)	(816,556)
Cash flows from financing activities:
Issuance of EMC's common stock from the exercise of stock options	226,276	176,774
Issuance of VMware's common stock from the exercise of stock options	166,523	167,417
Repayments on securities lending	(412,321)	0
Repurchase of EMC's common stock	0	(1,119,986)
Excess tax benefits from stock-based compensation	25,355	96,046
Payment of short and long-term obligations	(19,836)	(5,678)
Proceeds from short and long-term obligations	1,615	2,125
Net cash used in financing activities	(12,388)	(683,302)
Effect of exchange rate changes on cash and cash equivalents	22,862	(6,995)
Net (decrease) increase in cash and cash equivalents	(325,326)	991,489
Cash and cash equivalents at beginning of period	5,843,685	4,482,211
Cash and cash equivalents at end of period	5,518,359	5,473,700
Reconciliation of net income to net cash provided by operating activities:
Net income	720,829	1,032,189
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	791,043	785,871
Non-cash interest expense on convertible debt	80,562	76,286
Non-cash restructuring and in-process research and development	22,138	80,705
Stock-based compensation expense	420,947	357,668
Increase in provision for doubtful accounts	15,160	16,615
Deferred income taxes, net	8,101	588
Excess tax benefits from stock-based compensation	(25,355)	(96,046)
Gain on Data Domain and SpringSource common stock	(25,822)	0
Other, net	(13,567)	(4,135)
Changes in assets and liabilities, net of acquisitions:
Accounts and notes receivable	455,116	270,942
Inventories	(61,265)	4,039
Other assets	(35,483)	(68,180)
Accounts payable	66,868	14,096
Accrued expenses	(175,982)	(286,691)
Income taxes payable	(143,896)	4,326
Deferred revenue	204,707	290,177
Other liabilities	21,627	19,892
Net cash provided by operating activities	$2,325,728	$2,498,342

Statement Of Other Comprehensiv

Statement Of Other Comprehensive Income (USD $)
In Thousands	3 Months Ended Sep. 30, 2009	3 Months Ended Sep. 30, 2008	9 Months Ended Sep. 30, 2009	9 Months Ended Sep. 30, 2008
Net income	$304,868	$406,544	$720,829	$1,032,189
Other comprehensive income (loss), net of taxes (benefits):
Foreign currency translation adjustments	19,726	(11,136)	30,474	(10,249)
Changes in market value of investments, including unrealized gains and losses and reclassification adjustment to net income, net of taxes (benefits) of $(1,168), $(9,336), $19,917 and $(20,873)	39	(15,424)	30,650	(33,081)
Other-than-temporary investment losses, excluding credit losses recognized in the Consolidated Income Statements, net of tax benefits of $(62), $0, $(1,446) and $0	(113)	0	(2,684)	0
Other-than-temporary investment losses reclassified to net income, net of tax benefits of $1,384, $0, $1,384 and $0	2,571	0	2,571	0
Changes in market value of derivatives, net of taxes (benefits) of $385, $147, $(57) and $121	895	1,329	572	1,091
Other comprehensive income (loss)	23,118	(25,231)	61,583	(42,239)
Comprehensive income	327,986	381,313	782,412	989,950
Less: Net income attributable to the non-controlling interest in VMware, Inc.	(6,688)	(13,133)	(23,348)	(27,007)
Less: Other comprehensive income attributable to the non-controlling interest in VMware, Inc.	(191)	0	(515)	0
Comprehensive income attributable to EMC Corporation	$321,107	$368,180	$758,549	$962,943

2_Statement Of Other Comprehens

Statement Of Other Comprehensive Income (Parenthetical) (USD $)
In Thousands	3 Months Ended Sep. 30, 2009	3 Months Ended Sep. 30, 2008	9 Months Ended Sep. 30, 2009	9 Months Ended Sep. 30, 2008
Changes in market value of investments, including unrealized gains and losses and reclassification adjustment to net income, taxes (benefits)	($1,168)	($9,336)	$19,917	($20,873)
Other-than-temporary investment losses, excluding credit losses recognized in the Consolidated Income Statements, tax benefits	(62)	0	(1,446)	0
Other-than-temporary investment losses reclassified to net income, tax benefits	1,384	0	1,384	0
Changes in market value of derivatives, taxes (benefits)	$385	$147	($57)	$121

Statement Of Shareholders Equit

Statement Of Shareholders Equity And Other Comprehensive Income (USD $)
In Thousands		Common Stock Par Value	Additional Paid-in Capital	Retained Earnings	Other Comprehensive Loss	Non-controlling Interest in VMware	Total
Beginning Balance at Dec. 31, 2007		$21,022	$3,462,673	$9,396,108	($8,449)	$188,988	$13,060,342
Beginning Balance at Dec. 31, 2007	2,102,187
Stock issued through stock option and stock purchase plans	15,831
Stock issued through stock option and stock purchase plans		158	176,616				176,774
Tax benefit from stock options exercised			108,913				108,913
Restricted stock grants net of cancellations and withholdings	(1,578)
Restricted stock grants net of cancellations and withholdings		(15)	(51,017)				(51,032)
Repurchase of common stock	(75,685)
Repurchase of common stock		(757)	(1,119,229)				(1,119,986)
Stock options issued in business acquisitions			4,057				4,057
Stock-based compensation expense			375,522				375,522
Impact from equity transactions of VMware, Inc.			31,888			79,294	111,182
Change in market value of investments					(33,081)		(33,081)
Change in market value of derivatives					1,091		1,091
Currency translation adjustment					(10,249)		(10,249)
Net income				1,005,182		27,007	1,032,189
Ending Balance at Sep. 30, 2008	2,040,755
Ending Balance at Sep. 30, 2008		20,408	2,989,423	10,401,290	(50,688)	295,289	13,655,722
Beginning Balance at Dec. 31, 2008		20,129	2,817,054	10,671,212	(179,952)	327,507	13,655,950
Beginning Balance at Dec. 31, 2008	2,012,938
Stock issued through stock option and stock purchase plans	26,713
Stock issued through stock option and stock purchase plans		267	226,009				226,276
Tax benefit from stock options exercised			9,626				9,626
Restricted stock grants net of cancellations and withholdings	171
Restricted stock grants net of cancellations and withholdings		2	(49,203)				(49,201)
Stock options issued in business acquisitions			83,780				83,780
Stock-based compensation expense			426,654				426,654
Impact from equity transactions of VMware, Inc.			22,758			107,498	130,256
Change in market value of investments					30,650	515	31,165
Change in market value of derivatives					572		572
Non-credit other-than-temporary losses on investments					(113)		(113)
Currency translation adjustment					30,474		30,474
Net income				697,481		23,348	720,829
Ending Balance at Sep. 30, 2009	2,039,822
Ending Balance at Sep. 30, 2009		$20,398	$3,536,678	$11,368,693	($118,369)	$458,868	$15,266,268

1. Basis of Presentation

1. Basis of Presentation
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
1. Basis of Presentation	1.Basis of Presentation Company EMC Corporation (EMC) and its subsidiaries develop, deliver and support the Information Technology (IT) industrys broadest range of information infrastructure technologies and solutions. EMCs Information Infrastructure business supports customers information lifecycle management (ILM) strategies and helps them build information infrastructures that store, protect, optimize and leverage their vast and growing quantities of information. EMCs Information Infrastructure business consists of three segments Information Storage, Content Management and Archiving and RSA Information Security. EMCs VMware Virtual Infrastructure business, which is comprised of a majority equity stake in VMware, Inc. (VMware), is the leading provider of virtualization infrastructure solutions from the desktop to the data center. VMwares virtual infrastructure software solutions run on industry-standard desktops and servers and support a wide range of operating system and application environments, as well as networking and storage infrastructures. General The accompanying interim consolidated financial statements are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information. These consolidated financial statements include the accounts of EMC, its wholly owned subsidiaries and VMware, a company majority-owned by EMC. All intercompany transactions have been eliminated. Certain information and footnote disclosures normally included in our annual consolidated financial statements have been condensed or omitted. Accordingly, these interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December31, 2008 which are contained in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February27, 2009. Effective January1, 2009, we adopted new authoritative guidance relating to the accounting for convertible debt instruments. The guidance changed the accounting treatment for certain convertible securities including our convertible debt. Under the guidance, issuers are required to allocate the bond proceeds into a debt portion and a conversion option. The allocation of the bond portion is based upon the fair value of the debt without the equity conversion option. The residual value is allocated to the conversion option which is accounted for as additional paid-in capital. As a result of this change, the bonds are recorded at a discount which is amortized over the instruments expected life using the effective interest method, resulting in additional non-cash interest expense. We revised prior period financial statements by reclassifying $669.1 million of our convertible debt associated with our $1.725 billion 1.75% convertible senior notes due 2011 (the 2011 Notes) and our $1.725 billion 1.75% convertible senior notes due 2013 (the 2013 Notes and, together with the 2011 Notes, the Notes) to additional paid-in capital and increased interest expense by $26.0 million and $76.3 million for the three and nine months e

2. Acquisitions

2. Acquisitions
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
2. Acquisitions	2.Acquisitions In the second quarter of 2009, we acquired all of the outstanding capital stock of Configuresoft, Inc. (Configuresoft), a provider of server configuration, change and compliance management software. The acquisition complements and extends our server configuration management solutions within the Information Storage segment. In the third quarter of 2009, we acquired all of the outstanding capital stock of Data Domain, Inc. (Data Domain), a provider of storage solutions for backup and archive applications based on deduplication technology. Data Domain deduplication storage systems are designed to deliver reliable, efficient and cost-effective solutions that enable enterprises of all sizes to manage, retain and protect their data. This acquisition further complements and expands our Information Storage business. The purchase price for Data Domain, net of cash and investments, was approximately $2,017.3 million, which consisted of $1,933.9 million of cash consideration, including $65.0 million paid in the second quarter of 2009, and $83.4 million for the fair value of our stock options granted in exchange for existing Data Domain options. We incurred $12.0 million of transaction costs for financial advisory, legal and accounting services, which costs are included in restructuring and acquisition-related charges in our Consolidated Income Statements. The fair value of our stock options issued to employees of Data Domain was estimated using a Black-Scholes option pricing model. The fair value of the stock options was estimated assuming no expected dividends and the following weighted average assumptions: Expected term (in years) 2.3 Expected volatility 37.0 % Risk-free interest rate 1.2 % The consolidated financial statements include the results of Data Domain from the date of acquisition. The purchase price has been allocated to the assets acquired and the liabilities assumed based on estimated fair values as of the acquisition date. The following represents the allocation of the Data Domain purchase price (table in thousands): Trade accounts receivable (approximates contractual value) $ 72,455 Other current assets 9,275 Property and equipment 40,403 Intangible assets: Completed technology (weighted-average useful life of 2.6 years) 106,300 Customer maintenance relationships (weighted-average useful life of 5.8 years) 133,700 Customer product relationships (weighted-average useful life of 4.2 years) 111,500 Tradename (weighted-average useful life of 2.0 years) 6,400 In-process research and development 174,600 Total intangible assets 532,500 Other long-term assets 60 Goodwill 1,658,321 Current liabilities (67,212 ) Income tax payable (4,671 ) Deferred revenue (60,800 ) Deferred income taxes (152,818 ) Long-term liabilities (10,243 ) Total purchase price $ 2,017,270 The total weighted-average amortization period for intangible assets is 4.3 years. The intangible assets are being amortized

3. Convertible Debt

3. Convertible Debt
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
3. Convertible Debt	3. Convertible Debt In November 2006, we issued our Notes for total gross proceeds of $3.45 billion. The Notes are senior unsecured obligations and rank equally with all other existing and future senior unsecured debt. Holders may convert their Notes at their option on any day prior to the close of business on the scheduled trading day immediately preceding (i)September1, 2011, with respect to the 2011 Notes, and (ii)September1, 2013, with respect to the 2013 Notes, in each case only under the following circumstances: (1)during the five business-day period after any five consecutive trading-day period (the measurement period) in which the price per Note of the applicable series for each day of that measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such day; (2)during any calendar quarter, if the last reported sale price of our common stock for 20 or more trading days in a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter exceeds 130% of the applicable conversion price in effect on the last trading day of the immediately preceding calendar quarter; or (3)upon the occurrence of certain events specified in the Notes. Additionally, the Notes will become convertible during the last three months prior to the respective maturities of the 2011 Notes and the 2013 Notes. Upon conversion, we will pay cash up to the principal amount of the debt converted. With respect to any conversion value in excess of the principal amount of the Notes converted, we have the option to settle the excess with cash, shares of our common stock, or a combination of cash and shares of our common stock based on a daily conversion value, determined in accordance with the indenture, calculated on a proportionate basis for each day of the relevant 20-day observation period. The initial conversion rate for the Notes will be 62.1978 shares of our common stock per one thousand dollars of principal amount of Notes, which represents a 27.5% conversion premium from the date the Notes were issued and is equivalent to a conversion price of approximately $16.08 per share of our common stock. The conversion price is subject to adjustment in some events as set forth in the indenture. In addition, if a fundamental change (as defined in the indenture) occurs prior to the maturity date, we will in some cases increase the conversion rate for a holder of Notes that elects to convert its Notes in connection with such fundamental change. The Notes pay interest in cash at a rate of 1.75% semi-annually in arrears on December1 and June1 of each year. In connection with the sale of the Notes, we entered into separate convertible note hedge transactions with respect to our common stock (the Purchased Options). The Purchased Options allow us to receive shares of our common stock and/or cash related to the excess conversion value that we would pay to the holders of the Notes upon conversion. The Purchased Options will cover, subject to customary anti-dilution adjustments, approximately 215million shares of our common stock. Half of the Purc

4. Non-controlling Interest in

4. Non-controlling Interest in VMware, Inc.
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
4. Non-controlling Interest in VMware, Inc.	4. Non-controlling Interest in VMware, Inc. The effects of changes in our ownership interest in VMware on our equity were as follows (table in thousands): For the Nine Months Ended September30, 2009 September30, 2008 Net income attributable to EMC Corporation $ 697,481 $ 1,005,182 Transfers (to) from the non-controlling interest in VMware: Increase in EMC Corporations additional paid-in-capital for VMwares equity issuances 63,181 74,656 Decrease in EMC Corporations additional paid-in-capital for VMwares other equity activity (40,423 ) (42,768 ) Net transfers from non-controlling interest 22,758 31,888 Change from net income attributable to EMC Corporation and transfers from the non-controlling interest in VMware, Inc. $ 720,239 $ 1,037,070

5. Derivatives

5. Derivatives
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
5. Derivatives	5. Derivatives We hedge our exposure in foreign currency-denominated monetary assets and liabilities with foreign currency forward and option contracts. Since these derivatives hedge existing exposures that are denominated in foreign currencies, the contracts do not qualify for hedge accounting. Accordingly, these outstanding non-designated derivatives are recognized on the consolidated balance sheet at fair value, and the changes in fair value from these contracts are recorded in other income (expense), net, in the consolidated income statement. These derivative contracts mature in less than one year. We also use foreign currency forward and option contracts to hedge our exposure on a portion of our forecasted revenue and expense transactions and commodity option contracts to hedge our exposure on a portion of our forecasted energy expense transactions. These derivatives are designated as cash flow hedges and we did not have any derivatives designated as fair value hedges as of September 30, 2009 and December 31, 2008. All outstanding derivatives are recognized on the balance sheet at fair value and changes in their fair value are recorded in accumulated other comprehensive loss until the underlying forecasted transactions occur. To achieve hedge accounting, the criteria specified in authoritative guidance must be met. These criteria include (i) ensuring at the inception of the hedge that formal documentation exists for both the hedging relationship and the entitys risk management objective and strategy for undertaking the hedge and (ii) at the inception of the hedge and on an ongoing basis, the hedging relationship is expected to be highly effective in achieving offsetting changes in fair value attributed to the hedged risk during the period that the hedge is designated. Further, an assessment of effectiveness is required at a minimum on a quarterly basis. Absent meeting these criteria, changes in fair value are recognized currently in other expense, net, in the consolidated income statement. Once the underlying forecasted transaction is realized, the gain or loss from the derivative designated as a hedge of the transaction is reclassified from accumulated other comprehensive loss to the consolidated income statement, in the related revenue or expense caption, as appropriate. In the event the underlying forecasted transaction does not occur, the amount recorded in accumulated other comprehensive loss will be reclassified to other income (expense), net, in the consolidated income statement in the then-current period. Any ineffective portion of the derivatives designated as cash flow hedges is recognized in current earnings. The ineffective portion of the derivatives includes gains or losses associated with differences between actual and forecasted amounts. The following table provides the major types of derivative instruments outstanding as of September30, 2009 and December31, 2008 (table in thousands): Fair Values of Derivative Instruments Asset Derivatives September 30, 2009 December 31, 2008 Balance Sheet Location Fair Value Balance Sheet Location Fair Value Derivatives des

6. Investments and Fair Value

6. Investments and Fair Value
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
6. Investments and Fair Value	6. Investments and Fair Value In 2008, we adopted new authoritative guidance for fair value measurements that defines fair value, establishes a framework for measuring fair value and enhances disclosures about fair value measurements. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last is considered unobservable, that may be used to measure fair value: 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 not 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. In the second quarter of 2009, we adopted new authoritative literature that requires the credit component of an other-than-temporary impairment of investments in debt securities to be recognized in earnings and the non-credit component to be recognized in other comprehensive loss when the securities are not intended to be sold and it is more likely than not that we will not be required to sell the security prior to the recovery. The adoption of the pronouncement required the recording of a cumulative effect adjustment to retained earnings with a corresponding adjustment to other comprehensive loss equal to the present value of the cash flows expected to be collected less the amortized cost basis of the debt securities held at March31, 2009 for which an other-than-temporary impairment was previously recognized for securities that we do not intend to sell nor is it more likely than not that we will be required to sell before recovery of its amortized cost basis. We elected not to record the cumulative effect adjustment, as the amount was de minimis to our financial condition. Our investments are comprised primarily of debt securities that are classified as available for sale and recorded at their fair market values. At September30, 2009, with the exception of our auction rate securities, the vast majority of our investments were priced by pricing vendors. These pricing vendors utilize the most recent observable market information in pricing these securities or, if specific prices are not available for these securities, use other observable inputs. In the event observable inputs are not available, we assess other factors to determine the securitys market value, including broker quotes or model valuat

7. Inventories

7. Inventories
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
7. Inventories	7. Inventories Inventories consist of (table in thousands): September30, 2009 December31, 2008 Purchased parts $ 23,718 $ 62,866 Work-in-process 456,283 488,286 Finished goods 330,924 291,651 $ 810,925 $ 842,803

8. Property, Plant and Equipmen

8. Property, Plant and Equipment
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
8. Property, Plant and Equipment	8. Property, Plant and Equipment Property, plant and equipment consist of (table in thousands): September30, 2009 December31, 2008 Furniture and fixtures $ 230,564 $ 224,736 Equipment 3,496,040 3,387,498 Buildings and improvements 1,425,748 1,280,580 Land 116,658 115,873 Building construction in progress 79,274 95,219 5,348,284 5,103,906 Accumulated depreciation and amortization (3,129,652 ) (2,880,899 ) $ 2,218,632 $ 2,223,007 Building construction in progress at September30, 2009 includes $62.7 million for facilities not yet placed in service that we are holding for future use.

9. Notes Receivable

9. Notes Receivable
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
9. Notes Receivable	9. Notes Receivable In June 2009, we entered into a term loan agreement with Quantum Corporation (Quantum), pursuant to which Quantum borrowed a principal amount equal to $75.4 million from us. The agreement requires quarterly interest payments at a rate of 12%per annum. The scheduled maturity date of this loan is September30, 2014. In June 2009, we entered into a second term loan agreement with Quantum pursuant to which Quantum borrowed an aggregate principal amount equal to $46.3 million from us. This second loan agreement has terms similar to the first loan agreement with quarterly interest payments at a rate of 12%per annum and provides for two tranches of borrowings. Quantum borrowed an amount equal to $24.6 million under the first tranche, with a scheduled maturity date of September30, 2014 and an amount equal to $21.7 million under the second tranche, with a scheduled maturity date of December31, 2011. As of September30, 2009, the aggregate outstanding principal amount under all loans was $121.7 million. These loans are junior to Quantums current senior debt and senior to all other indebtedness. These notes are included in other assets, net in the consolidated balance sheet.

10. Accrued Expenses

10. Accrued Expenses
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
10. Accrued Expenses	10. Accrued Expenses Accrued expenses consist of (table in thousands): September30, 2009 December31, 2008 Salaries and benefits $ 675,115 $ 712,237 Product warranties 276,853 269,218 Restructuring (see Note 12) 124,860 224,702 Other 788,064 695,727 $ 1,864,892 $ 1,901,884 Product Warranties Systems sales include a standard product warranty. At the time of the sale, we accrue for the systems warranty costs. The initial systems warranty accrual is based upon our historical experience, expected future costs and specific identification of the systems requirements. Upon expiration of the initial warranty, we may sell additional maintenance contracts to our customers. Revenue from these additional maintenance contracts is deferred and recognized ratably over the service period. The following represents the activity in our warranty accrual for our standard product warranty (table in thousands): For the Three Months Ended For the Nine Months Ended September30, 2009 September30, 2008 September30, 2009 September30, 2008 Balance, beginning of the period $ 267,246 $ 274,741 $ 269,218 $ 263,561 Current period accrual 45,397 34,072 110,139 123,520 Amounts charged to the accrual (35,790 ) (40,182 ) (102,504 ) (118,450 ) Balance, end of the period $ 276,853 $ 268,631 $ 276,853 $ 268,631 The provision includes amounts accrued for systems at the time of shipment, adjustments for changes in estimated costs for warranties on systems shipped in the period and changes in estimated costs for warranties on systems shipped in prior periods. It is not practicable to determine the amounts applicable to each of the components. Additionally, the accrual for the nine months ended September30, 2008 includes $6.3 million assumed in the acquisition of Iomega Corporation.

11. Shareholders' Equity

11. Shareholders' Equity
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
11. Shareholders' Equity	11. Shareholders Equity Net Income Per Share The reconciliation from basic to diluted earnings per share for both the numerators and denominators is as follows (table in thousands): For the Three Months Ended For the Nine Months Ended September30, 2009 September30, 2008 September30, 2009 September30, 2008 Numerator: Net income, as reported, basic $ 298,180 $ 393,411 $ 697,481 $ 1,005,182 Incremental dilution from VMware (510 ) (1,176 ) (1,392 ) (5,058 ) Net income, diluted $ 297,670 $ 392,235 $ 696,089 $ 1,000,124 Denominator: Basic weighted-average common shares outstanding 2,027,347 2,048,594 2,015,920 2,060,952 Weighted-average common stock equivalents 38,604 28,880 23,064 34,085 Assumed conversion of the Notes 79 Diluted weighted-average shares outstanding 2,065,951 2,077,474 2,038,984 2,095,116 Options to acquire 114.5million and 172.4million shares of our common stock for the three and nine months ended September30, 2009, respectively, and options to acquire 154.1million and 116.6million shares of our common stock for the three and nine months ended September30, 2008, respectively, were excluded from the calculation of diluted earnings per share attributable to EMC Corporation shareholders because of their antidilutive effect. For the three and nine months ended September30, 2009, there were no shares potentially issuable under our Notes and the Sold Warrants because these instruments were not in-the-money. For the three and nine months ended September30, 2008, there were no shares and 0.1million shares, respectively, potentially issuable under our Notes. For the three and nine months ended September30, 2008, there were no shares potentially issuable under the Sold Warrants because these instruments were not in-the-money. The incremental dilution from VMware represents the impact of VMwares dilutive securities on EMCs diluted net income per share and is calculated by multiplying the difference between VMwares basic and diluted earnings per share by the number of VMware shares owned by EMC. Accumulated Other Comprehensive Loss, Net Accumulated other comprehensive loss, net, which is presented net of tax, consists of the following (table in thousands): September30, 2009 December31, 2008 Foreign currency translation adjustments, net of tax benefits of $0 and $0 $ 13,175 $ (17,299 ) Unrealized losses on temporarily impaired investments, net of tax benefits of $(11,581) and $(35,150) (20,506 ) (54,423 ) Unrealized gains on investments, net of taxes of $13,767 and $17,419 24,357 27,624 Unrealized losses on other-than-temporary impaired securities, net of tax benefits of $(62) and $0 (113 ) Unrealized losses on derivatives, net of tax benefits of $(16

12. Restructuring and Acquisiti

12. Restructuring and Acquisition-Related Charges
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
12. Restructuring and Acquisition-Related Charges	12.Restructuring and Acquisition-Related Charges For the three and nine months ended September30, 2009, we incurred restructuring and acquisition-related charges of $34.8 million and $83.6 million, respectively. For the three months ended September30, 2009, we incurred $20.3 million of restructuring charges, primarily related to our 2008 restructuring program and $14.5 million of costs were incurred in connection with acquisitions for financial advisory, legal and accounting services. For the nine months ended September30, 2009, we incurred $66.6 million of restructuring charges, primarily related to our 2008 restructuring program and $17.0 million of costs were incurred in connection with acquisitions for financial advisory, legal and accounting services. For the third quarter of 2009, we also recognized a $12.5 million charge to write-off a prepaid royalty associated with a contractual obligation that included a minimum purchase commitment. We do not anticipate achieving the minimum purchase level. The charge is classified within cost of product sales on the accompanying Consolidated Income Statements. During the three months ended September30, 2008, we recognized restructuring charges of $4.4 million. For the nine months ended September30, 2008, we recognized restructuring net charges of $2.7 million. For purposes of presentation, $4.0 million is presented as a restructuring charge and $1.3 million is presented as a reduction to SGA. In the fourth quarter of 2008, we implemented a restructuring program to further streamline the costs related to our Information Infrastructure business. The plan includes the following components: A reduction in force resulting in the elimination of approximately 2,400 positions which will be substantially completed by the end of 2009 and fully completed by the third quarter of 2010. The consolidation of facilities and the termination of contracts. These actions are expected to be completed by 2015. The write-off of certain assets for which EMC has determined it will no longer derive any benefit. These actions were completed in the fourth quarter of 2008. In addition to this plan, we also recognized an asset impairment charge of $28.0 million for certain assets for which the forecasted cash flows from the assets were less than the assets net book value. The total charge resulting from these actions is expected to be between $362.0 million and $387.0 million, with $247.9 million recognized in 2008, $100.0 million to $125.0 million to be recognized in 2009 and 2010 and the remainder to be recognized through 2015. Total cash expenditures associated with the plan are expected to be in the range of $310.7 million to $335.7 million. Additionally, in the third quarter of 2008 we implemented a restructuring program resulting in a reduction in force of approximately 75 employees and the consolidation of excess facilities. The charges for the three and nine months ended September30, 2009 were primarily attributable to recognizing additional expense related to the restructuring program implemented in the fourth quarter of 2008. The activity for each charge

13. Commitments and Contingenci

13. Commitments and Contingencies
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
13. Commitments and Contingencies	13.Commitments and Contingencies Line of Credit We have available for use a credit line of $50.0 million in the United States. As of September30, 2009, we had no borrowings outstanding on the line of credit. The credit line bears interest at the banks base rate and requires us, upon utilization of the credit line, to meet certain financial covenants with respect to limitations on losses. In the event the covenants are not met, the lender may require us to provide collateral to secure the outstanding balance, if any. At September30, 2009, we were in compliance with the covenants. Litigation We are involved in a variety of claims, demands, suits, investigations, and proceedings, including those identified below, that arise from time to time relating to matters incidental to the ordinary course of our business, including actions with respect to contracts, intellectual property, product liability, employment, benefits and securities matters. As required by authoritative guidance, we have estimated the amount of probable losses that may result from any such pending matters, and such amounts are reflected in our consolidated financial statements. These recorded amounts are not material to our consolidated financial position or results of operations. While it is not possible to predict the outcome of these matters with certainty, we do not expect the results of any of these actions to have a material adverse effect on our business, results of operations or financial condition. Because litigation is inherently unpredictable, however, the actual amounts of loss may prove to be larger or smaller than the amounts reflected in our consolidated financial statements, and we could incur judgments or enter into settlements of claims that could adversely affect our operating results or cash flows in a particular period. United States ex rel. Rille and Roberts v. EMC Corporation. On February27, 2009, the U.S. District Court for the Eastern District of Arkansas entered an order unsealing a civil False Claims Act qui tam action by two individuals (the relators) that named EMC as a defendant in December 2006. This action relates to the previously disclosed investigation being conducted by the Civil Division of the United States Department of Justice (the DoJ) regarding (i)EMCs fee arrangements with systems integrators and other partners in federal government transactions, and (ii)EMCs compliance with the terms and conditions of certain agreements pursuant to which we sold products and services to the federal government. By the same order of February27, 2009, the U.S. District Court for the Eastern District of Arkansas also unsealed a complaint in intervention filed by the DoJ in June 2008 in this matter and directed that EMC be served with both complaints. The DoJ complaint, which adopts the claims advanced by the relators, asserts claims under the Anti-Kickback Act and False Claims Act in addition to breach of contract and other claims. The DoJ and the relators seek various remedies, including treble damages and statutory penalties. By order dated June3, 2009, the Arkansas Court granted a motion by EMC to transfer the action to the U.S. District

14. Segment Information

14. Segment Information
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
14. Segment Information	14.Segment Information We manage our business in two broad categories: EMC Information Infrastructure and VMware Virtual Infrastructure. EMC Information Infrastructure operates in three segments: Information Storage, Content Management and Archiving and RSA Information Security, while VMware Virtual Infrastructure operates in a single segment. Our management measures are designed to assess performance of these operating segments excluding certain items. As a result, corporate reconciling items are used to capture the items excluded from segment operating performance measures, including stock-based compensation expense and intangible asset amortization expense. Additionally, in certain instances, IPRD charges, restructuring and acquisition-related charges and infrequently occurring gains or losses are also excluded from the measures used by management in assessing segment performance. The VMware Virtual Infrastructure amounts represent the revenues and expenses of VMware as reflected within EMCs consolidated financial statements. Research and development expenses, SGA and other income associated with the EMC Information Infrastructure business are not allocated to the segments within the EMC Information Infrastructure business, as they are managed centrally at the business unit level. For the three segments within the EMC Information Infrastructure business, gross profit is the segment operating performance measure. Our segment information for the three and nine months ended September30, 2009 and 2008 is as follows (tables in thousands, except percentages): EMC Information Infrastructure EMC Information Infrastructure VMware Virtual Infrastructure within EMC Corp Reconciling Items Consolidated Information Storage Content Management andArchiving RSA Information Security Three Months Ended: September30, 2009 Revenues: Product revenues $ 1,818,230 $ 58,209 $ 84,080 $ 1,960,519 $ 240,062 $ $ 2,200,581 Services revenues 880,807 118,979 68,420 1,068,206 248,843 1,317,049 Total consolidated revenues 2,699,037 177,188 152,500 3,028,725 488,905 3,517,630 Cost of sales 1,306,859 65,913 46,603 1,419,375 83,537 74,501 1,577,413 Gross profit $ 1,392,178 $ 111,275 $ 105,897 1,609,350 405,368 (74,501 ) 1,940,217 Gross profit percentage 51.6 % 62.8 % 69.4 % 53.1 % 82.9 % 55.2 % Research and development 255,028 98,087 68,977 422,092 Selling, general and administrative 830,277 208,855 138,643 1,177,775 Restructuring and acquisition-related charges

15. Income Taxes

15. Income Taxes
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
15. Income Taxes	15.Income Taxes Our effective income tax rates were 6.3% and 11.8% for the three and nine months ended September30, 2009, respectively. Our effective income tax rates were 13.5% and 19.1% for the three and nine months ended September30, 2008, respectively. The effective income tax rate is based upon the estimated income for the year, the composition of the income in different countries, and adjustments, if any, in the applicable quarterly periods for the potential tax consequences, benefits or resolutions of tax audits or other tax contingencies. For the three and nine months ended September30, 2008 and 2009, the effective tax rate varied from the statutory tax rate principally as a result of the mix of income attributable to foreign versus domestic jurisdictions. Our aggregate income tax rate in foreign jurisdictions is lower than our income tax rate in the United States. Our effective income tax rate decreased from the three months ended September30, 2008 to the three months ended September30, 2009 due to the change in the mix of income between our foreign and domestic jurisdictions and the recognition of discrete tax benefits associated with the finalization of certain federal income tax liabilities. Additionally, in 2009 our tax rate was favorably impacted by an increase in tax credits. Our effective income tax rate decreased from the nine months ended September30, 2008 to the nine months ended September30, 2009 due to the change in the mix of income between our foreign and domestic jurisdictions and the recognition of discrete tax benefits. The discrete benefits were principally the favorable resolution of uncertain tax positions related to transfer pricing and a U.S. federal income tax audit. Additionally, the decrease in our effective tax rate was due to an increase in tax credits, as well as non-deductible IPRD charges during the quarter ended March31, 2008 which increased the 2008 effective tax rate. As of December31, 2008, we had $218.5 million of unrecognized tax benefits and as of September30, 2009 we had $185.6 million of unrecognized tax benefits. During the nine months ended September30, 2009, the balance decreased by $39.0 million as a result of the favorable resolution of certain ruling requests from taxing authorities and the outcome of2005 and 2006 U.S. federal income tax audits. There was also a net increase of $6.1 million, which included increases for acquired uncertain tax positions and uncertain tax positions taken by EMC during 2009, partially offset by certain decreases arising from changes in measurement of prior year uncertain tax positions and the expiration of statutes of limitations. We have substantially concluded all U.S. federal income tax matters for years through 2006 and are in the process of a U.S. federal income tax audit for 2007 and 2008. We have income tax audits in process in numerous state, local and international jurisdictions. Based on the timing and outcome of examinations of EMC, the result of the expiration of statutes of limitations for specific jurisdictions or the timing and result of ruling requests from taxing authorities, it is reasonably possible that the related unrecog

16. Subsequent Events

16. Subsequent Events
	9 Months Ended Sep. 30, 2009 USD / shares
Notes to Financial Statements [Abstract]
16. Subsequent Events	16.Subsequent Events Management has updated the financial statements for events through November 6, 2009.

Document Information

Document Information
	9 Months Ended Sep. 30, 2009 USD / shares
Document Information [Text Block]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	2009-09-30

Entity Information

Entity Information (USD $)
	9 Months Ended Sep. 30, 2009
Entity [Text Block]
Trading Symbol	EMC
Entity Registrant Name	EMC CORP
Entity Central Index Key	0000790070
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding	2,039,821,792