DELL TECHNOLOGIES INC.

Reconciliation of Selected Non-GAAP Financial Measures

(in millions, except percentages; unaudited; continued on next page)

Three Months Ended

May 3, 2024

May 5, 2023

% Change

Gross margin

$         4,806

$         5,018

(4) %

Non-GAAP adjustments:

Amortization of intangibles

60

79

Stock-based compensation expense

38

38

Other corporate expenses

43

29

Non-GAAP gross margin

$         4,947

$         5,164

(4) %

Operating expenses

$         3,886

$         3,949

(2) %

Non-GAAP adjustments:

Amortization of intangibles

(108)

(124)

Stock-based compensation expense

(172)

(187)

Other corporate expenses

(133)

(72)

Non-GAAP operating expenses

$         3,473

$         3,566

(3) %

Operating income

$            920

$         1,069

(14) %

Non-GAAP adjustments:

Amortization of intangibles

168

203

Stock-based compensation expense

210

225

Other corporate expenses

176

101

Non-GAAP operating income

$         1,474

$         1,598

(8) %

Net income

$            955

$            578

65 %

Non-GAAP adjustments:

Amortization of intangibles

168

203

Stock-based compensation expense

210

225

Other corporate expenses

170

98

Fair value adjustments on equity investments

30

15

Aggregate adjustment for income taxes (a)

(610)

(156)

Non-GAAP net income

$            923

$            963

(4) %

____________________

(a) 

Beginning in Fiscal 2025, our non-GAAP income tax is calculated using a fixed estimated annual tax rate.