Good morning and welcome to the EMC’s Fourth Quarter Earnings Conference Call. All parties are in a listen-only mode until the question-and-answer portion of the call. As a reminder, this conference is being recorded. If you have any objections, you may disconnect at this time. I would like to introduce your host, Mr. Tony Takazawa, Vice President Global Investor Relations of EMC. Sir, you may now begin.

Thank you, good morning. Welcome to EMC's call to discuss our financial results for the fourth quarter of 2015. Today we are joined by EMC Chairman and CEO, Joe Tucci; EMC’s CFO, Zane Rowe; and David Goulden, EMC Information Infrastructure CEO. After the prepared remarks, we will then open up the lines to take your questions. Due to the pending transaction with Dell, we are making some changes to our call format and content in an effort to improve the efficiency of the call today. We’re streamlining our presentation and voluntary disclosures. EMC will also not be providing expectations for Company’s financial results. Please note, that we will be referring to non-GAAP numbers in today's presentation unless otherwise indicated. The reconciliation of our non-GAAP comments to our GAAP results can be found in the disclosure in today's press release, supplemental schedules, and the slides that accompany our presentation. In addition, all financial comparisons will be on a year-over-year basis unless otherwise indicated. As always, the call this morning will contain forward-looking statements, and information concerning factors that could cause actual results to differ can be found in EMCs filings with the U.S. Securities and Exchange Commission. Finally, this call does not constitute an offer to sell or a solicitation of any vote or approval. The proposed transaction will be submitted to the shareholders of EMC for their consideration. In connection with the proposed transaction, Denali Holding, Inc. has filed with the SEC a registration statement on Form S-4 that includes a preliminary proxy statement and prospectus regarding the proposed transaction. After the registration statement has been declared effective by the SEC, a definitive proxy statement and prospectus will be mailed to each EMC shareholder entitled to vote at the special meeting in connection with the proposed transaction. Investors are urged to read the proxy statement and prospectus in its entirety and other fillings made by Dell and EMC, as they contain important information about the proposed transaction. Investors may obtain copies of the proxy statement and prospectus and other documents filed with the SEC regarding the proposed transaction at the SEC's website or from EMC's website. Information regarding the persons who may under the rules of the SEC be deemed participants in such solicitation is set forth in the proxy statement and prospectus filed with the SEC. With that, it’s now my pleasure to introduce Joe Tucci. Joe?

Thank you, Tony. I’d like to begin by welcoming everyone to our Q4 earnings call. Thank you for joining us. This morning I’ll focus my formal remarks on three areas; trends in a macro environment and IT spending, a review of our businesses and lastly an update on the progress on our deal with Dell. From my perspective our results in Q4 were mixed. Well, I am pleased to report non-GAAP EPS of $0.65 I was disappointed that we fell a bit short on revenue, which was $7.01 billion essentially flat year-on-year. However, I would like to point out that it follows 24 consecutive quarters of reported year-on-year topline growth. As an accomplishment that very few our technology peers matched. I am proud of the more than 70,000 talented and dedicated people across the EMC family of companies. Despite all this tractions caused by the announced merger with Dell and a volatile global economy they worked diligently along with our value partners and focused intently on our customers and their needs, my deepest thanks to all of you. Let me now turn and comment on several macro trends we’re seeing in a global economy and in information technology and how they are playing out and affecting our customers and the IT industry. Both came back on 2015 it was quite [indiscernible] year. In 2015, we experienced a sharp decline in revenues in a significant number of the emerging marketing countries we serve. As these economies came under pressure. We experienced business declines in Russian and parts of the Middle East on the back of geopolitical unrest there. We experienced declines in our business in China as the country faced issues with their equity and housing markets leading to a lowering of IT imports. And we experienced significant currency fluctuations and…

Thanks Joe. Good morning everyone. This morning I'll discuss our consolidated results and provide some additional detail on Pivotal, VMware and EMC Information Infrastructure. First, I'd like to add my thanks to the extended team across our organization for all their efforts and focus this quarter. Our Q4 consolidated revenue totaled $7 billion, flat year-over-year and up 3% on a constant currency basis. EPS was $0.65. Our regional results were heavily impacted by currency fluctuations and the economies of the few countries. Consolidated revenue in North America was flat year-over-year. EMEA was down 1% as reported and up 7% on a constant currency basis. APJ was flat year-over-year as reported and up 4% in constant currency. The region continues to be significantly impacted by softness in China. Latin America was down 16% as reported and down 5% in constant currency. Brazil continues to be a challenging market in this geo. For the full-year 2015 consolidated revenue was $24.8 billion, up 1% year-over-year and up 5% on a constant currency basis. EPS was a $1.82. Looking at the quarterly results for the three major businesses; Pivotal grew revenue 25% year-over-year. As we previously mentioned annual recurring revenue or ARR is another way of measuring Pivotal’s progress as they've been transitioning from a license to a subscription model. In Q4, total ARR was over $100 million, up 40% sequentially with strong performance in all geographies and product areas. Pivotal had tremendous customer momentum during Q4 highlighted by Ford Motor Company’s announcing a three-year strategic collaboration with them. Beyond automotive in the fourth quarter Pivotal book the largest Cloud Foundry deal in history with a Fortune 50 retailer. Pivotal continues to expand its customer base across many industries including automotive, financial services, insurance, retail and telecommunications. VMware revenue was up 10% year-over-year and…

Thanks Zane. Good morning everyone and thank you for joining us today. I would also like to thank the entire EMC II team for their hard work and focus to ensure that EMC continues as the industry leader as our industry goes through one of the biggest transformations in its history. As we look at the external environment, customers continue to be in either transactional or transformational spending mode and in some cases both at the same time. Customers in a transactional spending mode are buying just enough and just-in-time for their traditional environments and we saw this in our stronger maintenance renewal bookings throughout last year. Customers in transformational mode are either transforming their existing IT systems towards a hybrid cloud or building and deploying new digital applications to transform their business. In either of these scenarios they need a modern datacenter infrastructure based on flash, scale out, software-defined, cloud-enabled and trusted technologies. Against this market backdrop, our storage business performed broadly inline with our recent expectations for the year and grew 3% in constant currency for the full-year. In Q4, we saw a little more pressure in our high-end and mid-tier business related to product cycles and we are addressing those very early this year. Within storage, our emerging storage is very well and became our second largest product related bucket in Q4. I want to clearly point out that we are actively investing in innovation and transforming our storage portfolio well ahead of our pears to position us well. IT budgets are moving and to accelerate a leader position in the next wave of IT. Our market share in the emerging category is higher in most cases than our share in traditional storage which is a good indicator for the future. In flash, XtremIO, our all-flash array…

Thanks, David. Before we open up the lines for your questions, as usual we ask you to try and limit yourself to one question, including clarifications. This will enable us to take as many questions as possible. We thank you all for your cooperation in this matter. Tori, can we have the first question, please?

Thank you, sir. [Operator Instructions] Our first question is from the line of Mr. Steve Milunovich with UBS. Sir, your line is now open. You may ask your question.

Thank you very much. Joe I wanted to get your sense on a couple of trends in the industry that you alluded to. On the Flash side I think study that you funded suggest that through compression and so forth you could take 18 terabytes and put them into three. So it appears Flash could be extremely deflationary on Storage industry revenues I was curious what your thoughts are on that. And then also do you believe that standalone Storage companies can survive in the future given the importance of the Converged platform and obviously you are merging with Dell?

Steve I’ll let David start, he is one step closer obviously as I said Flash is one of the megatrends that's changing the infrastructure business forever, the infrastructure hardware business and software business forever. Then I’ll let David comment and you are right I do think that, I do believe that if you get to certain size and certainly we’re there and many others are there. Playing in the Storage alone is not a good strategy for the future David told you 20% of Storage will be sold as part of Converged infrastructure that number is growing incredibly rapidly. So obviously that's not where you want to be in life and that's part of where we've been moving the company over the years and it's also part of in my heart of what we're doing in this merger with Dell.

Yes. So Steve, on the technology side obviously Flash has moved a long way and we - in my comment refer to number of announcements we’re going to be making this quarter without revealing too much of them you'll certainly hear us talk about 2016 being the year where we really believe that all Flash systems should be the standard for primary storage. So that will be a big shift from where the market was and so talking more in hybrid terms really think that the technology house advanced to the stage with the latest 3D NAND technology and things like 3.8 terabyte drives, which of course you need to offset your system to optimize to use them that big and that fast, which is why we talked about the re-architecting we can really come to market with a complete family VNX, VMAX, XtremIO, DSSD leveraging this latest technology and basically use all-flash all the time for primary storage. Now when it comes to the CAD data compression technology you were talking about that really is application dependent one of the things that makes these systems price competitive in fact maybe even more so than a hybrid system is the fact that using flash you can use compression dedup another data efficiency technologies. Those bring the effective price for gigabyte down to about the same or maybe a little bit less than the hybrid, so depending upon your application with the compression you can get maybe 2X factor with dedup and you can get a little higher and of course you could also do instant snap copies and things which you can't do is effectively with disk. So it’s really bringing systems down to the same effective price. It’s not massively deflationary because they are still much more expensive to all media, but you can do more things with that media and basically produce a flash system, which is effectively the same price for effective terabyte as a hybrid that gives you much more performance.

Thank you, Steve. Next question please?

Thank you. Our next question is from Steve Fox with Cross Research. Your line is now open. You may ask your questions.

Thanks. Good morning. Just along the similar lines, but maybe a bigger picture question. As you look at sort of your whole emerging storage platform and how end-users are sort of changing their storage use cases. Can you talk about how that plays into your portfolio in 2016, what is accelerating maybe a little bit more than maybe you thought just 90 days or 180 days ago. And then I had a quick follow-up. Thanks

Steve, sure. Yes, this is David. Let me take that. Obviously, just ground ourselves in where we are very pleased with how the emerging storage portfolio came and grew during to the year and as we predicted [indiscernible] back in January, we actually do get the situation in Q4 where it became the largest cloud related bucket out of those three, which we’ve historically given. We expect, yes, whilst we are not giving you any overall detail for 2016. We expect to see a continued strong growth in that area. If you think of the key technologies in that things like iPhone, things like XtremIO, or software-defined storage those are all being driven by some of the secular trends that Joe talked about. I think the other thing is relating back to our prior answer. We do expect in our mid-tier and in our high-end this shift all-flash all-the-time to really give us some revised growth opportunities in those markets as well. So I think the portfolio going into 2016 just in great shape.

Great. And then just real quick, the 20% number you talked about for CI, how does that changed during the course of the year?

Yes, this is an interesting data point, it’s a little bit we are trying to intersect two kind of market trends, one how big is CI and how fast is it growing and how much of the total storage marketplace is consumed in the form of CI. When we talk about 2016 being a little over 20%, we think it's probably three or four points more than it was in 2015 which shows a pretty big increase in adoption when you think of how large the overall storage marketplace is and the CI is becoming an increasingly important piece of it.

And don’t think it is only from kind of just a lot of questions come I think from a hardware perspective, but think of why we did VMware and value now in a software-defined datacenter, software-defined networking, software-defined storage, software-defined compute. Think of it in terms of CI, which David talked about, think of it in terms of cloud. This is one of the reasons we’re taking so many assets out of EMC II and putting them into Virtustream to make sure that we get those cloud services offerings. And so there is a great opportunity in what we are doing and of course doing more with Dell, we think will bring us to the next level and make this company a real winner long-term.

That’s very helpful.

Next question please?

Thank you. Our next question is from Maynard Um with Wells Fargo. Your line is now open. You may ask your questions.

Hi, thank you. Joe, you said you're confident in the deal closing in the terms of the Dell deal. There's obviously a lot of concern that Dell may have difficulty raising the funds for the transaction given the markets and the stocks actually, your stocks has been trading below the cash offer on the deal at certain points in time. So any specifics you can share on what gives you that confidence in the deal closure and on the original terms. And are there any backup plans that you or the Board are considering and if you could give us a timeline of key dates I think that would be extremely helpful? Thanks.

Yes, let me start hear. I mean because this gives about five questions in that - better in that one. Look, this is a really big deal and there is a lot of noise in the system and there's lot of people have a lot of opinions, a lot of them are not based on a lot of fact. But there is increased and it certainly as we are doing there is a tremendously increased market volatility and I think it’s really fair to say this environment is not been kind to any security right. So that gives us strength as we have a binding solid merger agreement in place. We are highly confident on the contractual terms we have in place that we will meet those contractual terms. There is significant penalties in place both ways if this doesn't happen. The banks are fully committed and again what does that mean. I mean it mean that the banks have told us they can raise the money were split rated those things, we can do it even improve that rating and you got to speak to Dell about. So this gives us confidence if you look at our progress, if you look at our cash flow we are right on target. If you look at how we are performing against peers these are all important metrics. How we are performing against our peers? We are performing better than our peers. That’s’ why I pointed out that as reported. Forget about currency, we’ve had 25 quarters now in a row, the last one being flat and the previous 24 grow year-on-year. There is very few companies that are really our peers that weren’t born in the cloud error so to speak that can say that kind of – so basically we’re going to perform and of course you asked about the timing. We said that the S-4 is filed is when it becomes effective we will be more aggressive out there with you, but that the timeline for this deal closing is still between May and October and that will be probably dependent on a couple of the foreign antitrust approvals. So we are confident. We know what we’re doing and again focus on cash flow, our cash flow was really good.

Thank you, Maynard. Next question please.

Thank you. Our next question is from Rod Hall with JPMorgan. Your line is now open. You may ask your questions.

Yes, thanks for taking my question guys. I guess I wanted to maybe drill into the macro commentary you started off with Joe a little bit and Zane if you got something to add to this that would be interested as well. The North American growth rate was relatively flat in Q4 I think year-over-year about 0.8% and we also saw deterioration of LATAM. I guess I’m curious on a couple of front, one I would like to get a little bit more color on what you think trajectory looks like regionally. And then Joe maybe if you could comment a little bit on where you think we are in the enterprise budget setting process particularly in the U.S. right now. Is there a lot of visibility where it is prices are going to reset budgets or is that coming later and just what do you think the outlook is this year for enterprise IT spending? Thanks.

Hey Rod. This is Zane. I’ll start and then Joe can give you an update. As I discussed I mean when you look on a constant currency basis I actually thought that things came in I would say as expected were not for a number of key countries within those economies. I mean obviously we’ve seen softness in China all year and that had a meaningful impact on our APJ results which would have been positive were it not for the Chinese impact. And then even EMEA was impacted by Russia, which is down significantly and then of course Latin America. We’re seeing probably more widespread pressure in Latin America, but of course that was heavily influenced by Brazil as well. As far as you know we are not getting into guidance into the year, but I would say we generally are expecting things to continue as they are, we are not expecting sort of dramatic shifts as we look at the future in any of those economies around the world.

I think two comments, when you look at the U.S. a lot of that was on the back of kind of what David pointed out. I have been very forthcoming in saying majority what’s happening in IT is on the back of these huge secular trends that we’ve talked about many times, but that doesn't mean is not cyclical effects and you saw a bigger stall in the U.S. because the U.S. was probably better in tune with the product cycles that we are having in products like VMAX and VNX. In this world nothing is kept as secret. So I think these two new refreshers and systems that David is talking about are huge to us I think that was effect. So we did have our product cycles affect here for sure. And most that I had showed up in the U.S. first as it always does. In spending trends in our customers I don't think any customer world is holding back now and what they are willing to spend on security, especially the security around protecting against advanced threats not inside the firewall, not mode protection to really picking it up in that area and David said we’re seeing that. We are also spending significantly and big on digital transformation. And of course they are spending some money and saving some money and basically how do I modernize my private cloud and use and get the benefit of using public cloud. So this cloud strategy is both the positive and a negative and that's why we think things like VMware’s new multi cloud, multi device strategy important things like Virtustream are important things like our software-defined storage is important. So we think we are well-positioned there and as again I’ll go back to our track record versus others, which is really a key metric in this deal is very solid.

Thank you. Next question please.

Thank you. Our next question is from Jayson Noland with Baird. Your line is now open. You may ask your question.

Okay. Great thank you. I wanted to ask about all-flash array market. Joe you’ve - looks like you have four different products on the market XtremIO, VMAX, VNX and DSSD coming pretty soon. It sounds like there are specific parts of the market that have different needs and then the competitive dynamics there’s lots of different players, who do you see the most often, do you expect the legacy players to have a big play in all-flash also?

Yes, well I’ll let David and then I will make couple of my comments. Before David goes maybe I will start a little bit. There is no one answer to your question. I mean the beauty about being us is, we’re probably the only one that our competitors see everywhere. We see different competitors and different tiers and we’re introducing I think what’s going to be incredibly exciting the DSS product, which is way above where Storage sits today, its probably more high-end flash pricing, but more memory kind of DRAM kind of performance. So basically if you look at the strata we are saying as DRAM, there is the DSSD tier, there's the high-performance primary storage. So you know we're basically using flash up and down a line and with that alternative – so we’re the only ones I know that are playing is and with software-defined, we’re the only ones I know that are playing flash as broadly and as significantly I don’t know think that any competitor is doing, we are doing. But go ahead David.

Hey Jayson. Just to pick up on Joe’s comments I mean I think we’ve demonstrated successfully, we can match the portfolio and our strength really with our big customers is the fact that we have this [best of three] portfolio because there is no such thing as one platform [indiscernible] workload. So as Joe talks about DSSD is going to address a whole new class of workloads, XtremIO and VMAX are playing in broadly similar markets but with different attributes and the new mid-tier line cap fits underneath that. So we really have the market exceptionally well covered and of course leading with an all-flash in general and primary storage again giving way a little bit about what you can hear in terms of the launch. And then last but not least we have key technologies like ViPR and SRM to clock all that and make it basically very transparent to our customers they just see virtual ones, they don’t necessary have to know what underlying storage system its on, but we [indiscernible], so we given the combination of this complete portfolio approx that they can provide for the different workloads and also a very consistent experience from the infrastructure system up to the application which is really being a power of our portfolio.

Thanks Jayson. Next question please.

Thank you. Our next question is from James Kisner with Jefferies. Your line is now open.

Thanks. So I was hoping you would comment on the competitive environment and storage. Some of your smaller competitors have indicated that incumbents like EMC have increased the disconnectivity recently, is that the case and you are seeing the competitive environment is towards intensify or is really just more of the same? Thanks.

James. Yes, this is David. Let me take that. I mean clearly in a market that certain segments of the market have matured and overall growth rates have slowed down little bit obviously is a more competitive environment. We’ve been facing into that I can give you a couple of data points that might help you one of the things that we’ve been looking at very much all year is, what’s our gross margin look like in storage on a normalized basis what I mean by taking out the impacts of FX taking out the impacts of VCE to look at those on an apples-to-apples basis. And yes this being an increasingly competitive environment but mix shift has moved positively such the way when I look at either Q4 or the full year gross margin on the normalized basis is basically flat with 2015 which we think is quite given the technology shifts and the competitive pressures in the industry. So yes, we have seen a more competitive intensity and yes we’ve been responding to that, but we’ve also been seeing a positive mix shift towards some of our higher growth and richer margin products have kept the overall profile of business in good shape.

Thank you.

Thanks James. Next question please.

Thank you. Our next question is from Kathryn Huberty with Morgan Stanley. Your line is now open. You may ask your questions.

Yes, thank you. Have you seen any impact on sales cycles just overall demand as it relates to the announced trends transaction and any plans to provide transparency on which products survive under the new parent company?

Let me first comment on first, we don’t hear us bring this up, right, I mean because we don't believe in using excuses we’ll tell you like it is, but that said obviously even personally I could tell you that – the deal of this size causes [indiscernible] and you do have to take an extra lap around the track to go explain. The good news is once you explain to customers, once you explain to your people they both – those an important audience is right I mean your customers and your people as you can approach customers without the people. Once you get them understanding what we could create here, we do get a positive effect, but it does as I said of course another lap around the track and so it does cause accident to system and certainly that was some of the miss, but we didn’t alluded to it at all because we think this merger in the best interest of all parties we are great from our shareholders to our people to with customers and we work that everyday. But as we get into more and more it’s becoming more and more better understood. So Dave you want to take the second part of that question.

Yes, Kathryn sure. I mean first of all we know broadly I think you know very broadly there is not a lot of overlap between the portfolios, they are quite complementary. With there is some overlap, we’re going to make sure all our customer are looked after and everybody has a roadmap going forward with that technology platform. Now that might mean that some platforms have merged into common code base and things like that, but we’re going to be very careful to make sure that all our customers buying products right now from either company have a clear go forward path into the future based upon those investments.

Thank you.

Thank you, Kathryn. Next question please?

Thank you. Our next question is from the line of Kulbinder Garcha with Credit Suisse. Your line is now open. You may ask your questions.

Thanks. My question for David. On the information storage business and you see most [indiscernible] kind of come down. I know that being that’s probably in the VCE consolidation, but are we at the point in which the gross margin level of these percentage terms may have dropped off, what's been going on there and what do you think about the various mix drivers going forward? Many thanks.

So Kulbinder, I think your question was on gross margin, you broke up just a little bit there, but I pointed out that this year was very important year for us and that the gross margins normalize again taking out the impact of VCE where we did bring some additional lower margin products into our income statement as opposed to in other income when you back that out you normalize for FX. Our gross margins in storage normalized were basically flat for the year and they are flat for Q4 as well. I think that's a good sign going forward, because we've been able to mix shift a loss I mean obviously over the last two to three years, if you go back to what happened and our gross margins normalized relatively flat in 2014 over 2013 as well. So you kind of look at how much that the mix shift is occurred in the business over the last couple of years. People thought that obviously when the mix went away from the higher end to some of the newer segments that would be a problem for gross margin, on a normalized basis it is not. I think that's a really good sign as the mix is shifting we’ve been able to hold those gross margins of course in that environments has also become more competitive than it was a couple years ago. So I think all that shows that we’re actually executing well and driving a lot of value out of the new segments of the business.

Thanks. Next question please?

Thank you. Our next question is from Amit Daryanani with Royal Bank of Canada. Your line is now open. You may ask your questions.

Thanks a lot. Good morning guys. I just wanted to talk a little bit about X-IO and all-flash VMAX and VNX products here that are launched. Could you talk about what workloads, what application would each one fit into? And then very specifically X-IO I think has always been known very well for inline deduplication compression capabilities. Is that something [indiscernible] into the high-end VMAX or VNX all-flash solutions to leverage that as well?

This is David. I would love to answer that question, but I mean wait a little bit more until we get to the product launches because if I answer too much of that question I mean we are getting away. Let me just put it this way the product launches are Quantum Leap. What we’ll talk about in the new VMAX is not just putting a whole bunch of flash drives in an existing VMAX system. We’ve done a lot of re-architecting, the way that software works, the VMware works, the hardware works to truly take advantage of these new [indiscernible] 3D NAND-technology at scale which is a lot of work. So I’d like to have that conversation, the context of the product launch. Clearly, we focus through. We think there is great positioning between the portfolios, the very complementary and we are going to add to that with obviously what we’ll do in the second quarter with the new midrange system, but net-net we’re very excited. I don’t think there is any problem here is all this is all good size all opportunity, but I'll get into more detail when we do the launch.

Thanks. Next question please?

Thank you. Our next question is from Simona Jankowski with Goldman Sachs. Your line is now open. Please proceed.

Hi, thank you very much. You talked a lot about new products on the roadmap for the next couple of quarters. What are some of the changes in your go-to-market or in your competitive posture that you think you can implement by being private in part of Dell that you couldn't have done as a standalone public company?

Simona sure, I mean that’s a great question and this is also source of things we can do, when we [indiscernible] of course we’ve to be a little bit careful about how far we can go down that pathway. If you just think about it from a very high level point of view EMC has a lot of strength in the enterprise market in the global accounts. Dell plays that role obviously we can provide a lot of value with those relationships and our technology footprint. Dell has incredible strength in the mid-market place in local government in education, if you go back just a few years when EMC and Dell had a partnership that was wroth almost $2 billion a year revenue for EMC alone and that point in time we’re half the size of the company that we are right now. So just a complementary nature of the go to market is very, very strong and then the complementary nature of the product is also beneficial, because we talked about the factor storage and service are in some ways re-converging around converged infrastructure and around software-defined - on service and the ability to go to our customer both large and small with the complete enterprise infrastructure portfolio also gives us a ton of benefits. So again it’s an area that we are very infused about and we’ve got teams looking at how we can best optimize after we close. End of Q&A

Thank you, Simona. That’s all the time we have for questions. We have a few concluding comments from Joe.

First of all thank you all for being with us today. We really appreciate it. We believe in our strategy and our ability to execute. We continue to believe that the merger with Dell is the best strategic option for our shareholders, our customers, our partners and our people. We believe we will close this transaction under the original terms, on the original timeframe. Once the S-4 goes effective, we will pick up our communication with you, we will be out there with you. And we value you and our investor so much. Thank you for being with us and we will see you soon.