AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 4/6 · 18/10/2026
Moat—
Insufficient evidence for every rubric criterion; no category score is inferred.
structural advantage · — · Volume-based rebates and proprietary assets are established, but their superiority over competing offerings or procurement terms is not. The economic moat remains uncertain.
durability · — · Negotiated rebate programs and a patent portfolio do not establish how long any relative advantage persists. Rapid technology changes further limit inference.
customer dependency · — · Support demand from prior product sales demonstrates an installed-base relationship, but the passages do not establish material migration costs, exclusivity or dependence on Dell.
erosion resilience · — · Recent pricing success coexists with supply pressure and earlier PC price weakness. These outcomes cannot establish resilience of an unidentified structural advantage.
Pricing power—
Insufficient evidence for every rubric criterion; no category score is inferred.
realized pricing · 2/4 · Fiscal 2027 traditional server and PC selling prices rose with disclosed pricing discipline, demonstrating realized repricing. Fiscal 2026 PC price declines and recent PC unit declines make the broader record mixed; configuration changes also affect selling prices.
retention · 2/4 · Support and maintenance on prior-period products and customer refresh activity provide indirect evidence of continuing demand. PC unit declines and the absence of customer cohorts or renewal results prevent a strong retention assessment.
margin resilience · 2/4 · Pricing largely offset first-half Fiscal 2027 AI mix pressure despite realized component inflation. However, consolidated gross margin declined across Fiscal 2024–2026, and operating improvement also reflects expense control and growth. Resilience is mixed and does not independently establish a moat.
contractual freedom · — · Observed repricing establishes achieved pricing outcomes but does not disclose customer contract duration, repricing rights or restrictions on changing terms. Supplier rebate negotiations do not establish customer contractual freedom.
Predictability89
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 75.00
- Revenue growth volatility (pp)
- 11.75
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 2.97
Financial strength41
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 61.66
- netDebtEbitGrade
- 50.98
- interestCoverageGrade
- 38.40
- currentRatioGrade
- 12.83
- Debt / FCF (x)
- 3.68
- Net debt / operating income (x)
- 2.45
- Interest coverage (x)
- 5.22
- Current ratio (x)
- 0.91
Capital allocation100
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 36.39
- 3-year average dilution (%)
- -2.75
- 3-year average SBC / revenue (%)
- 0.82
- cashConversionGrade
- 100.00
Management63
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Cash generation, investment and reduced weighted-average shares demonstrate tangible capital deployment. In the latest half-year, $5.4 billion of repurchases and $0.9 billion of dividends exceeded operating cash flow after $2.2 billion of capital spending, while debt and inventory increased. These are mixed outcomes; repurchase value creation is not established.
incentive alignment · 3/4 · Disclosed compensation links annual pay and multiyear equity to revenue, operating income and relative shareholder returns. Actual March 2026 performance RSU vesting demonstrates implementation. This supports strong incentive design, without proving exceptional alignment or a complete ownership-based assessment.
execution · 3/4 · Reported annual growth, cash generation and sharply higher first-half Fiscal 2027 revenue and operating income support strong demonstrated execution. This is inferred from operating outcomes rather than customer retention data. Industry demand contributes, and inventory exposure and reporting revisions temper the assessment.
governance · 2/4 · Independent board and committee structures and implemented oversight improvements are substantive positives. Majority voting control, the ability to relinquish voluntary independence protections and historical financial revisions offset them. Historical Delaware provisions are not assumed to remain current after the later conversion-related disclosures.
Evidence
The terms and conditions of our vendor rebate programs are largely based on product volumes and are generally negotiated either at the beginning of the annual or quarterly period, depending on the program.
MD&A / vendor rebate program terms · Filed 08/09/2026
Our gross margins for the second quarter and first six months of Fiscal 2027 were not materially affected by any changes to the terms of our vendor rebate programs, as the amounts we received under these programs were generally stable relative to our total net cost.
MD&A / realized vendor rebate stability · Filed 08/09/2026
The timing and amount of vendor rebates and other discounts we receive under the programs may vary from period to period, reflecting changes in the competitive environment.
MD&A / competitive variability of vendor rebates · Filed 08/09/2026
Strong and accelerating industry demand for AI‑optimized solutions, together with current limitations in capacity from memory manufacturers, has resulted in global supply constraints and substantial inflation in memory component costs.
MD&A / realized memory supply constraints and inflation · Filed 08/09/2026
To meet the growing demand and increasing complexity of our AI-optimized servers offerings, we have increased our purchases of certain components with suppliers, which has resulted in increased inventory levels, higher purchase obligations, and new working capital dynamics.
MD&A / increased inventories, purchase obligations and working capital · Filed 08/09/2026
We face aggressive competition from a variety of competitors in all areas of our business, including companies that specialize in one or more of our product or service lines.
Risk Factors / aggressive competition across business lines · Filed 16/03/2026
As of January 30, 2026, we held a worldwide portfolio of 25,859 granted patents and 8,189 pending patent applications.
Business / granted patents and pending applications · Filed 16/03/2026
Our product and process patents may establish barriers to entry, and we anticipate that our worldwide patent portfolio will continue to be of value in negotiating intellectual property rights with others in the industry.
Business / management assessment of potential patent barriers · Filed 16/03/2026
During the second quarter and first six months of Fiscal 2027, storage net revenue increased 26% and 17%, respectively, primarily due to growth in demand for our Dell-IP storage offerings and disciplined pricing.
MD&A / storage demand and pricing outcomes · Filed 08/09/2026
We operate in an industry in which there are rapid technological advances in hardware, software, and services offerings, including AI, cloud, and security-related offerings.
Risk Factors / rapid technological advances · Filed 16/03/2026
Traditional servers and networking net revenue increased 122% and 108% during the second quarter and first six months of Fiscal 2027, respectively, primarily driven by an increase in the average selling price of these offerings, driven by disciplined pricing and, to a lesser extent, richer configurations.
MD&A / traditional server and networking revenue and selling prices · Filed 08/09/2026
The increase in the average selling prices of our CSG offerings was primarily attributable to disciplined pricing.
MD&A / CSG selling price attribution · Filed 08/09/2026
During the second quarter of Fiscal 2027, the increase was partially offset by a decrease in units sold.
MD&A / second-quarter commercial PC unit decline · Filed 08/09/2026
Consumer net revenue increased 7% and 8% during the second quarter and first six months of Fiscal 2027, respectively, due to an increase in the average selling prices of our consumer offerings, partially offset by a decline in units sold.
MD&A / consumer PC price increases and unit declines · Filed 08/09/2026
During Fiscal 2026, commercial net revenue increased 8% primarily due to an increase in units sold and richer configurations, partially offset by a decline in average selling prices.
MD&A / Fiscal 2026 commercial PC demand and selling price decline · Filed 16/03/2026
Consumer net revenue decreased 8% during Fiscal 2026 due to a decline in average selling prices and units sold.
MD&A / Fiscal 2026 consumer PC price and unit declines · Filed 16/03/2026
During the first six months of Fiscal 2027, gross margin percentage and non-GAAP gross margin percentage decreased 10 basis points to 19.4% and 30 basis points to 19.7%, respectively, primarily due to a shift in mix towards our AI-optimized servers offerings, the effect of which was largely offset by disciplined pricing.
MD&A / first-half gross margin mix pressure and pricing offset · Filed 08/09/2026
Fiscal Year Ended January 30, 2026 January 31, 2025 February 2, 2024 Dollars % of Net Revenue % Change Dollars % of Net Revenue % Change Dollars % of Net Revenue (in millions, except percentages and per share amounts) Net revenue: Products $ 90,405 79.6 % 27 % $ 71,420 74.7 % 11 % $ 64,353 72.8 % Services 23,133 20.4 % (4) % 24,147 25.3 % — % 24,072 27.2 % Total net revenue $ 113,538 100.0 % 19 % $ 95,567 100.0 % 8 % $ 88,425 100.0 % Gross margin: Products $ 12,348 13.7 % 10 % $ 11,258 15.8 % — % $ 11,237 17.5 % Services 10,359 44.8 % 4 % 9,992 41.4 % 2 % 9,832 40.8 % Total gross margin $ 22,707 20.0 % 7 % $ 21,250 22.2 % 1 % $ 21,069 23.8 % Operating expenses $ 14,558 12.8 % (3) % $ 15,013 15.7 % (4) % $ 15,658 17.7 % Operating income $ 8,149 7.2 % 31 % $ 6,237 6.5 % 15 % $ 5,411 6.1 % Net income $ 5,936 5.2 % 30 % $ 4,576 4.8 % 36 % $ 3,372 3.8 % Earnings per share attributable to Dell Technologies — diluted $ 8.68 36 % $ 6.38 39 % $ 4.60 Cash flow from operations $ 11,185 147 % $ 4,521 (48) % $ 8,676 Non-GAAP Financial Information Fiscal Year Ended January 30, 2026 January 31, 2025 February 2, 2024 Dollars % of Net Revenue % Change Dollars % of Net Revenue % Change Dollars % of Net Revenue (in millions, except percentages and per share amounts) Non-GAAP gross margin: Products $ 12,599 13.9 % 9 % $ 11,574 16.2 % (1) % $ 11,642 18.1 % Services 10,560 45.6 % 3 % 10,236 42.4 % 2 % 10,002 41.6 % Total non-GAAP gross margin $ 23,159 20.4 % 6 % $ 21,810 22.8 % 1 % $ 21,644 24.5 % Non-GAAP operating expenses $ 13,168 11.6 % (1) % $ 13,281 13.9 % (4) % $ 13,766 15.6 % Non-GAAP operating income $ 9,991 8.8 % 17 % $ 8,529 8.9 % 8 % $ 7,878 8.9 % Non-GAAP net income $ 7,046 6.2 % 20 % $ 5,865 6.1 % 8 % $ 5,422 6.1 % Non-GAAP earnings per share attributable to Dell Technologies — diluted $ 10.30 27 % $ 8.14 10 % $ 7.37 Free cash flow $ 8,555 337 % $ 1,958 (67) % $ 5,923 Adjusted free cash flow $ 11,508 272 % $ 3,097 (45) % $ 5,607 Non-GAAP product gross margin, non-GAAP services gross margin, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income, non-GAAP net income, non-GAAP earnings per share attributable to Dell Technologies - diluted, free cash flow, and adjusted free cash flow are not measurements of financial performance prepared in accordance with GAAP.
MD&A / three-year operating results and cash generation · Filed 16/03/2026
The increases were primarily attributable to growth within ISG services gross margin and, to a lesser extent, CSG services gross margin that were driven by support and maintenance associated with products sold in prior periods.
MD&A / support and maintenance from products sold in prior periods · Filed 25/03/2025
•Technology refresh: Within our ISG business, we continue to see customers modernize and consolidate their data centers as more customers transition to next-generation products and expand capacity to support growing workloads, which has resulted in significant demand within our traditional servers and networking offerings and our storage offerings.
MD&A / customer infrastructure modernization and expansion · Filed 08/09/2026
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions; unaudited) Six Months Ended July 31, 2026 August 1, 2025 Cash flows from operating activities: Net income $ 7,571 $ 2,129 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 1,512 1,500 Stock-based compensation expense 373 369 Deferred income taxes 23 (127) Other, net (a) (454) 389 Changes in assets and liabilities: Accounts receivable (5,428) (4,574) Financing receivables (6,404) (569) Inventories (10,940) (615) Other assets and liabilities 761 612 Accounts payable 16,203 6,615 Deferred revenue 3,089 (390) Change in cash from operating activities 6,306 5,339 Cash flows from investing activities: Purchases of investments (335) (125) Sales of equity and other investments 90 59 Capital expenditures and capitalized software development costs (2,202) (1,243) Divestitures of businesses and assets, net — 533 Other 43 33 Change in cash from investing activities (2,404) (743) Cash flows from financing activities: Repurchases of common stock (5,424) (2,920) Repurchases of common stock for employee tax withholdings (555) (357) Payments of dividends and dividend equivalents (869) (762) Proceeds from debt 6,851 7,270 Repayments of debt (3,805) (3,424) Debt-related costs and other, net (34) (35) Change in cash from financing activities (3,836) (228) Effect of exchange rate changes on cash, cash equivalents, and restricted cash (35) 104 Change in cash, cash equivalents, and restricted cash 31 4,472 Cash, cash equivalents, and restricted cash at beginning of the period 11,706 3,819 Cash, cash equivalents, and restricted cash at end of the period $ 11,737 $ 8,291 ____________________ (a) During the six months ended July 31, 2026, other, net, includes $0.6 billion of gains recognized within the Company’s strategic investments portfolio.
Financial statements / first-half cash generation, investment, repurchases and financing · Filed 08/09/2026
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued) (unaudited) NOTE 6 — DEBT The following table summarizes the Company’s outstanding debt as of the dates indicated: July 31, 2026 January 30, 2026 (in millions) Senior Notes $ 24,073 $ 21,573 Legacy Notes 952 952 DFS Debt (Note 4) 9,618 9,139 Other 104 99 Total debt, principal amount 34,747 31,763 Debt issuance costs and net unamortized discount (281) (260) Total debt, carrying value $ 34,466 $ 31,503 Short-term $ 8,481 $ 7,990 Long-term $ 25,985 $ 23,513 The Company completed the following transactions during the six months ended July 31, 2026: •repayment of the remaining outstanding $0.5 billion principal amount of 6.02% Senior Notes due June 2026; and •issuance of $1.0 billion principal amount of 4.75% Senior Notes due July 2031, $0.75 billion principal amount of 5.00% Senior Notes due February 2034, and $1.25 billion principal amount of 5.25% Senior Notes due February 2037, the net proceeds of which the Company intends to use for general corporate purposes, which may include the repayment of debt.
Note 6 / debt balances, repayment and issuance · Filed 08/09/2026
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (in millions, except per share amounts; unaudited) Three Months Ended Six Months Ended July 31, 2026 August 1, 2025 July 31, 2026 August 1, 2025 Net revenue: Products $ 41,112 $ 23,935 $ 79,217 $ 41,534 Services 5,859 5,841 11,596 11,620 Total net revenue 46,971 29,776 90,813 53,154 Cost of net revenue: Products 33,990 21,044 66,842 36,160 Services 3,151 3,285 6,359 6,610 Total cost of net revenue 37,141 24,329 73,201 42,770 Gross margin 9,830 5,447 17,612 10,384 Operating expenses: Selling, general, and administrative 3,336 2,889 6,479 5,853 Research and development 1,109 785 2,092 1,593 Total operating expenses 4,445 3,674 8,571 7,446 Operating income 5,385 1,773 9,041 2,938 Interest and other, net (254) (333) 38 (415) Income before income taxes 5,131 1,440 9,079 2,523 Income tax expense 998 276 1,508 394 Net income $ 4,133 $ 1,164 $ 7,571 $ 2,129 Earnings per share: Basic $ 6.41 $ 1.72 $ 11.70 $ 3.11 Diluted $ 6.34 $ 1.70 $ 11.58 $ 3.07 Weighted-average shares outstanding: Basic 645 678 647 685 Diluted 652 686 654 694 The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
Financial statements / first-half operating results and weighted-average shares · Filed 08/09/2026
Dell Technologies / 2026 Proxy Statement / 80 Table of Contents Summary Information Proposal 1 Proposal 2 Proposal 3 Proposal 4 Compensation Committee Report Compensation Committee Interlocks and Insider Participation Compensation Discussion and Analysis Compensation of Executive Officers Pay Versus Performance Disclosure Compensation Component Purpose Performance Period Performance Metric Base Salary Provide market-competitive compensation for talent attraction and retention Annual — Annual Cash Bonus Create culture of high achievement by linking pay to Company and individual short-term performance and promote talent attraction and retention Annual Revenue Operating Income Time-Based RSUs Promote talent retention and alignment of interests with stockholders Three years with annual vesting — Performance-Based RSUs Reward short- and long-term Company performance, including relative to peer companies, and promote alignment with interests of stockholders Three years Annual revenue Annual operating income Three-year rTSR (1) In addition to the primary compensation components, the Committee granted a one-time award of performance-based stock options to Mr.
Compensation discussion / adopted compensation components and performance measures · Filed 15/05/2026
Goals ($ in billions)(1) Percentage of Target Financial Funding Performance Measure Weight Threshold Plan (Target) Above Plan (Maximum) Results Year 1 (Fiscal 2026) Non-GAAP Net Revenue(2) 25% 92.1 102.3 117.6 111.8 144%(4) Non-GAAP Operating Income(3) 25% 8.6 9.6 11.0 9.9 Funding Percentage 50% 100% 200% (1) Financial performance goals for Fiscal 2026 were approved by the Committee in March 2025.
Compensation discussion / Fiscal 2026 performance targets and results · Filed 15/05/2026
A corresponding number of performance-based RSUs vested on March 15, 2026.
Compensation discussion / actual March 2026 performance RSU vesting · Filed 15/05/2026
Relative Total Shareholder Return rTSR is measured over a three-year performance period and is weighted at 50%.
Compensation discussion / three-year relative shareholder return weighting · Filed 15/05/2026
We are a “controlled company” within the meaning of the rules of the New York Stock Exchange (the “NYSE”) because the MD stockholders hold common stock representing more than 50% of the voting power eligible to vote in the election of directors.
Risk Factors / controlling stockholders' majority voting power · Filed 16/03/2026
Although we currently maintain a board composed of a majority of independent directors and three standing committees of the board composed entirely of independent directors, we may decide in the future to change our board membership and committee composition so that the board is not composed of a majority of independent directors or one or more committees, other than the audit committee, are not composed entirely of independent directors.
Risk Factors / current independent board and committees, and ability to change composition · Filed 16/03/2026
In recent fiscal years, our Board has continued to strengthen our governance profile by: • establishing the Lead Independent Director role; • approving independent director rotation for service as the Group IV director; • reconstituting the membership of the Nominating and Governance Committee to consist entirely of independent directors; Dell Technologies / 2026 Proxy Statement / 15 Table of Contents Summary Information Proposal 1 Proposal 2 Proposal 3 Proposal 4 Compensation Committee Report Compensation Committee Interlocks and Insider Participation Compensation Discussion and Analysis Compensation of Executive Officers Pay Versus Performance Disclosure • establishing a standalone Compensation Committee composed entirely of independent directors; • appointing an independent compensation consultant by the Compensation Committee; and • increasing the percentage of independent directors on the Board to 75%, following the addition of Mr.
Governance / implemented independent oversight practices · Filed 15/05/2026
As discussed in Note 1 and Note 22 of the Notes to the Consolidated Financial Statements included in this report, the Consolidated Financial Statements were revised for the fiscal year ended February 2, 2024 and the unaudited interim periods for Fiscal 2025 and Fiscal 2024 to correct for the overstatement of cost of net revenue to the Consolidated Statements of Income, net of the related income tax effect, and the corresponding amounts affecting the Consolidated Statements of Financial Position.
Financial reporting / revisions correcting cost of revenue overstatement · Filed 25/03/2025
Recurring Revenue and Consumption Models — We expect that our flexible consumption models will further strengthen our customer relationships and provide a foundation for recurring revenue.
MD&A / prospective customer relationship benefits of consumption models · Filed 09/06/2026
