DELL TECHNOLOGIES INC.

Reconciliation of Selected Non-GAAP Financial Measures

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

Three Months Ended

Six Months Ended

August 2, 2019

August 3, 2018

Change

August 2, 2019

August 3, 2018

Change

Net revenue

$

23,370

$

22,942

2%

$

45,278

$

44,298

2%

Non-GAAP adjustments:

Impact of purchase accounting

84

180

166

367

Non-GAAP net revenue

$

23,454

$

23,122

1%

$

45,444

$

44,665

2%

Gross margin

$

7,326

$

6,123

20%

$

14,123

$

12,001

18%

Non-GAAP adjustments:

Amortization of intangibles

519

718

1,038

1,428

Impact of purchase accounting

85

185

169

378

Transaction-related expenses

—

21

(5)

137

Stock-based compensation expense

32

18

58

34

Other corporate expenses

24

1

37

7

Non-GAAP gross margin

$

7,986

$

7,066

13%

$

15,420

$

13,985

10%

Operating expenses

$

6,807

$

6,136

11%

$

13,054

$

12,167

7%

Non-GAAP adjustments:

Amortization of intangibles

(541)

(808)

(1,239)

(1,620)

Impact of purchase accounting

(17)

(30)

(34)

(59)

Transaction-related expenses

(47)

(83)

(94)

(133)

Stock-based compensation expense

(269)

(198)

(506)

(381)

Other corporate expenses

(690)

(59)

(700)

(123)

Non-GAAP operating expenses

$

5,243

$

4,958

6%

$

10,481

$

9,851

6%

Operating income (loss)

$

519

$

(13)

NM

$

1,069

$

(166)

744%

Non-GAAP adjustments:

Amortization of intangibles

1,060

1,526

2,277

3,048

Impact of purchase accounting

102

215

203

437

Transaction-related expenses

47

104

89

270

Stock-based compensation expense

301

216

564

415

Other corporate expenses

714

60

737

130

Non-GAAP operating income

$

2,743

$

2,108

30%

$

4,939

$

4,134

19%