Dell Technologies Inc. Q4 FY2021 Earnings Call

· Earnings call transcript and AI-powered summary

Overview

  • Dell reported record Q4 revenue of $26.1B, up 8% year-over-year (YoY).
  • Full-year FY2021 revenue reached an all-time high of $94.4B, up 2% YoY despite pandemic-driven disruptions.
  • Strong execution across Client Solutions Group (CSG) and VMware offset softness in Infrastructure Solutions Group (ISG).
  • Record profitability and cash generation, including $5.9B in Q4 operating cash flow.

Key Financial Highlights

  • Q4 revenue: $26.1B, +8% YoY, supported by strong client demand and VMware growth.
  • Full-year operating income: $10.8B, +6% YoY.
  • Full-year EPS: $8.00, +9% YoY.
  • Adjusted EBITDA: $12.7B, +8% YoY.
  • Operating cash flow: $11.4B (FY2021), with Q4 alone delivering $5.9B (record level).
  • Debt reduction: Achieved FY2021 goal of $5.5B core debt pay-down; core leverage now ~2.5x.

Business Segment Performance

Client Solutions Group (CSG)

  • Q4 revenue: $13.8B, +17% YoY.
  • Full-year revenue: $48.4B, +5% YoY.
  • Record shipments; calendar 2020 PC units reached 50.3M (+8% YoY per IDC).
  • Commercial PCs: +16% YoY in Q4; strong notebook demand, Chromebooks up triple digits.
  • Consumer business: Record $13B full-year revenue, +12% YoY.

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Operator: Good afternoon, and welcome to the Fiscal Year 2021 Fourth Quarter and Year End Financial Results Conference Call for Dell Technologies Inc. I’d like to inform all participants this call is being recorded at the request of Dell Technologies. This broadcast is the copyrighted property of Dell Technologies, Inc. Any rebroadcast of this information in whole or part without the prior written permission of Dell Technologies is prohibited. Following prepared remarks, we will conduct a question-and-answer session. [Operator Instructions] I’d like to turn the call over to Rob Williams, Head of Investor Relations. Mr. Williams, you may begin. Rob Williams: Thanks, Katherine and thanks, everyone for joining us today. With me today are our Vice Chairman and COO, Jeff Clarke, our CFO, Tom Sweet; and our Treasurer, Tyler Johnson. Our press release, financial tables, web deck, prepared remarks and additional materials are available on our IR website. The guidance section will be covered on today's call. During this call, unless we otherwise indicate, all references to financial measures refer to non-GAAP financial measures, including non-GAAP revenue, gross margin, operating expenses, operating income, net income, earnings per share, EBITDA, adjusted EBITDA and adjusted free cash flow. A reconciliation of these measures to their most directly comparable GAAP measures can be found in our web deck and press release. Please also note that all growth percentages refer to year-over-ye

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