Good morning, and welcome to the EMC Q1 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, VP, Global Investor Relations of EMC. Sir, you may begin.

Thank you. Good morning. Welcome to EMC's call to discuss our financial results for the first quarter of 2016. Today, we are joined by EMC Chairman and CEO, Joe Tucci; EMC's CFO, Denis Cashman; 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 have made some changes to our call format and content. In an effort to improve the efficiency of the call today, we are streamlining our presentation and voluntary disclosures. EMC will also not be providing expectations for company financial results. Please note that we will be referring to non-GAAP numbers in today's presentation, unless otherwise indicated. A 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 EMC's 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…

Thank you, Denis. Good morning, everyone, and thank you for joining us today. We had an exciting start to the year with major product launches in the first quarter that will set the tone for us for the rest of the year. In Q1, we significantly expanded our all-flash portfolio with the launch of VMAX All Flash, our industry-leading, high-end enterprise storage platform re-architected to take full advantage of large capacity SSDs; and the launch of DSSD, an industry first, rack-scale flash platform with Quantum Leap performance for next-generation workloads. We also introduced our new, next-generation, hyper-converger appliance family, VxRail. VxRail represents a key partnership between EMC and VMware that's well positioned to disrupt the fast-growing hyper-converged markets. The initial customer response to all these launches has been tremendous. More on this later. While our innovative market-leading portfolio bodes well for the future, today, we are still operating in an overall market environment that is pressured by cautious transactional spending. As we've discussed before, the overall market continues to show opposing behaviors. While businesses accelerate their adoption of newer storage technologies to drive their IT transformations, they remain cautious about their transactional spending, including traditional standalone storage. As a result, these counteracting spending behaviors pressure the overall growth of the markets. Against this market backdrop, our overall storage was down 6% in Q1 and down 4% in constant currency. The continued customer caution in transactional spending resulted in a very late quarter and a higher than anticipated buildup of unfulfilled orders as compared to Q1 last year. Normalizing for the higher level of unfulfilled orders, overall storage was down 2% in constant currency, which was in line with our revenue expectations for Q1. As our customers continue to prioritize between their transformational and their transactional spending, we believe that IT…

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. Nicole, can we have the first question, please?

Thank you. Our first question is coming from the line of Ittai Kidron of Oppenheimer. You may now ask your question. Ittai Kidron - Oppenheimer & Co., Inc. (Broker): Thanks. Hi, guys, and thanks for the question. A couple for me. One on the – David, with regards to the product revenue in storage, you're down 10% on a year-over-year basis. Do you see a bottom in this or do you think this is a year where double-digit decline in your product core is something we should expect? And also, just as a tweak to that, the VMAX All-Flash array, why did you feel you need something like this? Does it suggest that customers are not interested in XtremIO? Why is this product needed?

Hi, Ittai. Joe, you want to start off with a couple comments about the overall environment for 2016? And maybe I can follow up specifically about this Q1 storage product revenue. Joseph M. Tucci - Chairman, President & Chief Executive Officer: Yeah, maybe I'll start in a little bit different place. I think that if you look at the – one of the things that I think we should probably have gotten through maybe in our prepared remarks, so I'll do it now, is when we originally filed the S-4, we put some early views in of 2016. And as always, we looked at the environment and, of course, as always, the board has given us a plan that which – an approved plan for 2016, and I want to assure everybody this plan is a growth plan. It calls for year-on-year revenue growth over 2015, year-on-year non-GAAP EPS growth, and very importantly, year-on-year free cash flow growth. The – in my opinion, out of all of the secular – there's secular things that happen and cyclical things that happen in any business, but the biggest – if you're in a product business, the biggest factor you face is product cycles. And obviously, the main engine of – one of the main engines of growth and profitability in all of EMC is what we do in primary storage. And David will take this in a second, but that is subject to significant product cycles. So when the board gave us our plan for the year, we – that's why I said in my remarks that we basically, if you adjust for the lateness of the quarter and the build-up of unfulfilled orders, we basically hit exactly what our plan was. And in that plan, we assumed that we – as we knew that we had to face some major product launches and cycles. But it's really exciting and, of course, I wanted to make sure you knew that this was a growth year, and I think that answers, Ittai, the heart of your question. I'll let David give you the details.

So, Ittai, let me pick up on that. So let's start with your first question, the storage product revenue down 10% for the quarter. Let me make a couple of comments about that. First of all, it was impacted by FX through a couple points. So that takes it down to 8%. The year-on-year backlog change actually made a four-point difference to the growth rate. The year-on-year backlog change is slightly more than the $75 million that Denis mentioned in his remarks, because I'm talking now year-on-year. That made a four-point difference in growth rate. So normalized for FX and normalized for the build-up in unfulfilled orders or backlog, it's actually down 4% year-on-year. The first comment I'd make is that's actually an improvement from Q4 when you make the same adjusting factors. Part of that improvement is driven by the product cycle that Joe talked about. Now the product cycle, we're in a very early stage of the product cycle for the major products of VMAX and VNX. VMAX, we just announced the VMAX All Flash in the middle of Q1. That's a game changer. I'll come back at the end and explain why we needed that in (30:25) XtremIO. We have a major new mid-tier announcement at EMC World. I'll save the details, but that will be the start of a new cycle for where the traditional VNX plays. So you've got early product cycles that are going to be very exciting for both VMAX and VNX. And then the other things that we've just announced recently that are gaining steam, VxRail, DSSD, VxRack, are small but starting to grow in Q1, and then as I mentioned in my prepared remarks, we've seen great growth in the quarter from some of the engines that are important, so XtremIO,…

Okay. Thank you. Can we move on to the next question, please?

Thank you. Our next question is from Jayson Noland of Robert Baird and Company. You may now ask your question. Jayson A. Noland - Robert W. Baird & Co., Inc. (Broker): Okay. Thank you. David, the AFA market seems to have accelerated here recently. Love to hear you talk about AFA versus disk on-premise, Tier 1 data versus Tier 2 data going forward. Is there a place for disk? And then, Joe, is – do you have any role in the combined company? I'm sure Michael would love to have you on board.

Well, I will certainly leave that second one to Joe, Jayson. I'll answer the first one. So we do believe – and we said that for primary storage, think of it for transactional applications – we believe this is the year where we're going to move the vast majority of all new system shifts to all-flash, and we're going to lead the industry in that trend. The real tipping point here is some of the technology advances, in particular, the advents of some of the 3D NAND Flash technology working at one write per day with very large capacity drives. If you mirror that up with a high-performance platform like the VMAX, and obviously you can incorporate that technology in all the all-flash, that really is the tipping point where you can effectively get a customer into an all-flash system at the same or slightly lower dollar per gigabyte than the effective dollar per gigabyte for a hard disk drive system, but then they get all the additional benefits of easier management, lower footprint space, lower power and cooling, et cetera. So the TCO equation for a customer is very compelling. Having said that, persistent data still has a very cost-effective equation being on these large capacity hard disk drives, and we see them being out there for many years to come in the persistent data category. So it will still be a question of and. But we believe that in primary storage, we're going to move industry rapidly to all-flash for the vast majority of new systems. We expect to do that throughout the course of this year. Joseph M. Tucci - Chairman, President & Chief Executive Officer: Jayson, I'm going to punt a little bit, and this is – and then I'm going to tell you the absolute truth. To me, this is all about making sure it's a good deal for our customers, our shareholders and our people, and they're all priority number one to me. And it's not about me. I have a lot of energy left, I'm going to continue to work doing different things. Potential that I could help advise Michael, but I just don't want to go there yet, and Michael and I have not gone there yet. I could tell you, we're working incredibly well together and I have tremendous respect for Michael. (35:17) relationship more respectful, and I'm just going to – I'm just not going to – I'm just not making myself part of this process or a condition of any factor in this process. It's all about shareholders, customers, people. Our people. Jayson A. Noland - Robert W. Baird & Co., Inc. (Broker): Thanks, Joe.

Thanks. Can we go to the next question, please?

Thank you. The next question is from Aaron Rakers of Stifel Nicolaus. Your line is now open. Aaron Rakers - Stifel, Nicolaus & Co., Inc.: Yeah, thanks for taking the question. I wanted to go through the product portfolio again on the storage side. And what I wanted – I was wondering if you could just help me understand kind of the continued decline that you've seen in your storage gross margin. As you make these migrations to these emerging product categories, is EMC either becoming more cost competitive in the market to drive those businesses or is there another reason that we continue to see kind of this storage gross margin decline? Thank you.

Yeah, let me let Denis start on the margin comment, and then I'll just come back and talk a little bit more about the portfolio, Aaron. Denis G. Cashman - Chief Financial & Accounting Officer: Yeah. So, just a little background on the gross margin for storage. We were – that's the biggest piece of our gross margin within EMC II. Now, it actually ticked off year-over-year if I back out the impact of software cap. So we are actually pleased with that, and that's as a result of some of the transformational work we're doing with our cost transformation program. So directionally, it was pretty good for quarter one, and we see that progressing for the year.

Yeah. So, Aaron, as Denis said, certainly when you normalize the impact of software cap and you normalize the impact of volumes, because obviously volumes is very important for gross margin, we are actually quite pleased with the way the portfolio is shaping up. And if you think about it and you think about the product side from where we're actually going, we are very encouraged with the margins we're getting on the all-flash versions of our traditional products. And by that, I mean VMAX All Flash still in the early stages, but the ramp-up is going nicely and the gross margins are good. We expect to see that in the new mid-tier as well. And then if you think of the products that we've classically put in the emerging storage bucket, things like XtremIO, Isilon, ECS, ScaleIO, those are good margin products. So we actually see the profile, the mix shift of the storage portfolio actually being helpful to gross margins over time.

Thanks. Next question, please?

Thank you. The next question is from Toni Sacconaghi of Sanford Bernstein. You may now ask your question. Toni Sacconaghi - Sanford C. Bernstein & Co. LLC: Yes. Thank you. You've talked a lot about this migration from disk to flash. And I was wondering if you could sort of quantify or give some guideline on what you think that ultimate mix is. And also, specifically in the context of VMAX, you've often talked about new products taking three quarters to account for 50% of volume. And again, given that this is a radical change in terms of using flash in a primary array, how should we think about this product transition specifically on VMAX? And then just maybe for Joe, I was wondering if you could just comment on what you're seeing in the U.S. specifically. The growth rate in the U.S. was well below the company average. We've seen that from some other IT vendors as well. And I'm wondering if that's because the – you're seeing less transactional spending or whether the forces of change are more pronounced in the U.S., and so in the interim, there's more pressure on traditional vendors. Thank you. Joseph M. Tucci - Chairman, President & Chief Executive Officer: Yeah, let me just start and do a little bit of front end, Toni, and I'll comment on your question you asked of me, and then David can take the meat of it. I would – when I think of the storage market, it's not just disk to flash for primary. It is that, for sure. I mean, I believe the process where you're doing your main transactions for ERP, CRM, HRM, things like billing, anything that you do in a proactive in which your business runs day-to-day is – that will move…

Sure. So thanks, Toni. So first of all, let me just go back and reinforce how important XtremIO is to us. That is from the ground up, our all-flash scale-out architecture designed for mixed transactional workloads. That's going to continue to be a very important part of the portfolio, a rapidly growing part of the portfolio. And as I said, it's – the market share in Q4 is three times its closest competitor. But, of course, we've learned a lot from that model. And we've really done some exciting things to the VMAX All Flash in terms of how we packaged it, in terms of the VBrick format. It's very easy to build up in modular format. We're actually including a lot of the software titles on an appliance model. The Xtrem, they expect more. The lifetime maintenance guarantee, the lifetime insurance guarantee, et cetera, from XtremIO all apply into that model. So from a technology, a performance, a pricing, a packaging point of view, we've really changed the game with VMAX All Flash. Now, Toni, to your point, where we plan to drive that to, we're obviously early. We've had a few good weeks of experience in the market with the VMAX All Flash. I can tell you that from a goal point of view, by the time we get to year end, we're expecting over 50% of the new VMAX systems that we ship will be all-flash.

Okay. Thank you very much. Toni Sacconaghi - Sanford C. Bernstein & Co. LLC: Thank you.

Next question, please?

Thank you. Our next question is from Katy Huberty of Morgan Stanley. You may now ask your question. Kathryn Lynn Huberty - Morgan Stanley & Co. LLC: Yes. Thanks. Joe, you've mentioned that you're waiting on China for regulatory approval of the merger. Have you had any dialogue that gives you insight into their frame of mind or any concerns that they might have, and also on the timing of their decision and what might be delaying it relative to other countries? Thanks. Joseph M. Tucci - Chairman, President & Chief Executive Officer: I don't think it's delayed. China has a three-step process and they're – we are following and working with them on that process. Dell actually has a little bit more of a lead. So it's nothing that I'd say is concerning. But they do have a process and they are following their process.

Next question, please?

Thank you. Our next question is from Andrew Nowinski of Piper Jaffray. Your line is now open. Andrew James Nowinski - Piper Jaffray & Co (Broker): Okay. Thanks for taking the question. I'm wondering if you can give us any more color on VxRail and how it compares to Cisco's new HyperFlex solution, the Nutanix box, meaning, I guess, what do you see as the high level competitive advantages over HyperFlex and Nutanix? Thanks.

Sure, Andrew. VxRail is firstly, a real joint collaboration, exclusive collaboration effort between EMC and VMware. So I would tell you that it takes better advantage of the VMware software capability than anybody else out there. Also, we've done some really neat packaging around the system itself in terms of the modular family range, the entry-level price points. We've basically integrated a lot of EMC storage technology. So, as customers look at it, it's very differentiated, particularly in the VMware environment where it excels. But the inclusion of replication technology, of backup technology from VMware – sorry, from EMC makes it a really powerful combination, and nobody else can offer that kind of combined integrated offering with our set of feature functionality with a single support point. And that's why we think it's a barn buster. We're super excited about it. We've actually – I'm telling you, we've actually taken up our external expectations for it for the year. We had an aggressive set of goals coming out of the gate. We've actually increased those based upon what we're seeing for the first few weeks in the marketplace, and we think we can be in a market-leading position with this technology by the end of next year.

Thank you. Next question, please?

Thank you. Our next question is from Rod Hall of JPMorgan. Your line is now open.

Yeah, thanks for giving me a question, guys. I just had a couple of, I guess, clarifications. One is with regards to this mission-critical switch to all-flash. I know this thing's been asked multiple times, but I think just to give a little bit of clarity to the question, what we've seen are specific data points this quarter that suggested that transition has accelerated. And so I wonder if you guys could very specifically comment on whether you've seen an acceleration this quarter in that transition and then how you think the rate of change moves through the next couple of quarters. I guess what we're all wondering is whether we do see an accelerated move these next couple of quarters toward all-flash and away from mission-critical high RPM drives. And then the second thing I wanted ask is, Joe, just backing up to kind of your bigger picture comments and maybe, David, you, too. We're wondering what's happening with IT spending more broadly, not just storage but broad IT spending thinking amongst you guys' counterparts out there. Obviously, global macro situation still isn't particularly great, but the U.S. seems to be motoring along a little bit better than we thought it would. So I'm just wondering if you can give us any color on what you're hearing from your counterparts. Are they thinking about continuing to slow spending or are they feeling a little better about the overall macro environment? Thanks.

Rod, yeah. Let me start out and talk about the move to all-flash. And again, let's just clarify, this is all-flash for primary storage. There are multiple classes of storage. If you hear us talk about our storage portfolio, we talk about performance optimized storage and capacity optimized storage, we're talking here about the performance optimized storage, that class of storage moving to all-flash. And we believe, again, for new systems shift that 2016 becomes the tipping point. And the tipping point is a combination of the developments of the flash media. Again, I mentioned this 3D NAND technology which gives incredible performance and capacity at much better price points. That really has only become available in the first quarter of this year from some of the flash vendors, and that combined with some of the software enhancements that we and others have made around flash, really, I think changes the point such that the proposition to a customer now on a new system is, hey, for the same price as we could deliver to you, a hybrid system last year, we can give you at the same dollar per gigabyte or maybe slightly less, we can give you an all-flash system. And you don't have to bother about tearing, you don't have to bother about management, the performance is better. The footprint is better. The power and cooling is better. So it really becomes relatively a no-brainer in the primary storage marketplace, and we've done that now for the high end with VMAX. We're going to do that for the mid-tier very, very soon and we'll be announcing that at EMC World. And of course, we've got XtremIO for those applications where, really, all-flash and massive dedupe make a huge difference. So essentially, what's happening this year is in…

Thanks. Next question, please?

Thank you. Our next question is from James Kisner of Jefferies. You may now ask your question.

Yes. So, there's been a lot of talk on this call about the forces of change causing delays in customer purchases, but I just want to clarify, is it obvious to you from your customer conversations that this is not due to any kind of mounting concerns around the strength of the global economy at all? I mean, can that also be weighing on customer spending? Thanks. Joseph M. Tucci - Chairman, President & Chief Executive Officer: Well, absolutely, the economy is a factor. But I think this next wave of growth – and any company, any company is going to be more IT-driven than it was in the past. So it kind of – this is part of the digital transformation that every company and every enterprise, every government has got to go through. And how well they go through that transformation and become more digital, rediscover the art of writing software, become more software-enabled in their business processes and products, that's going to define how successful those companies are going to be. So we're – that's a huge change, but this is the biggest change that's the most disruptive, as I said before, and the most opportunity-rich that I've seen in my career in IT.

And then just to pick up on that, James, I mean, what that translates to for CIOs is a degree of caution, and we see it. We talk about this transactional spending. If people are spending on their existing systems to kind of keep the lights on without driving change, then they're trying to basically minimize the spend on that piece of the budget, and we see it in terms of people buying just enough, just in time, more renewals versus buying new systems as characterization, and that happens late end of the quarter. That's all a function of this more cautious transactional spending whilst people figure out exactly what their transformational initiatives are going to be and where they are going to prioritize their budget spend towards the things that Joe talked about. Are they going to spend money, first of all, upon transforming their existing environment? Are they going to move into a new digital business agenda, et cetera? And these dual forces are what we see in the marketplace, and we see it very clearly within our business. We see this heightened caution in the transactional spend, and we see it occurring in terms of late calls and things like that. But we also see these really exciting transformational projects as people are embarking upon these new journeys which is going to transform their business. And not surprisingly, in that environment, there's a counteracting force and it's a little harder to predict than when everything is flowing in the same direction.

Thank you.

All right. Thanks. We have time for one more question and then we'll have a few concluding comments from Joe.

Thank you. Our last question is from Steven Milunovich of UBS. You may now ask your question.

Thank you. I wonder if you could comment a bit about the competitive situation out there. Pure is obviously growing at a high rate, though I know you are much larger. But they talk about you having an older architecture in flash, so how do you think that plays out over time? And I was actually at NetApp, and like a lot of companies, they claim they're going to be picking up share as you go through the integration with Dell. They claim pretty strongly that they've – it's been pretty easier to pick up customers and employees much easier than in the past because of the deal. Would you comment on that?

Steve, actually – well, obviously, people will try and take advantage of an opportunity, but let me make a couple of points. First of all, compared to Pure, we have a fundamentally different and more advantageous architecture. We have a system which is designed to scale out and have data services running always on and always on all the time. Pure basically has a dual control architecture. And that limits their ability to scale out and limits their ability to expand into broader workloads. The traditional vendors like in NetApp, I talked about how the fact that we are, in fact, picking off their customers. I talked about 45 petabyte win sweeping the floor, we won their top five accounts during the quarter. So we are very confident that whilst people are obviously going to try to pick on us, we are the market leader, we're the biggest company in the industry, and we are obviously going through some change. We are very confident, our portfolio has never been stronger, and our competitive position had never been strong, which is great at this time.

Thanks, Steve. Joe? Joseph M. Tucci - Chairman, President & Chief Executive Officer: Well, again, I want to thank everyone for joining us today. We really do appreciate it. And I want you to understand that we in the EMC family of companies are excited about our future. We are confident in our ability to meet our 2016 revenue, EPS and cash flow goals, which are again our growth goals. On the merger front, we are working diligently with the SEC to become effective as soon as possible, and we are aggressively planning the detailed reintegrations so we can get a fast start once everything is finalized and approved. Importantly, as soon as our Registration Statement becomes effective, we will be out there with you, our valued shareholders, to make sure we answer your questions. So I thank you for – again, and we will see you real soon. Bye-bye.