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Table of Contents
EMC CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)
During 2010, VMware acquired certain software product technology and expertise from the EMC Information Infrastructure segment's Ionix IT
management business for cash consideration of $175.0 million. The acquisition of the Ionix net assets and expertise was accounted for as a business
combination between entities under common control. During the years ended December 31, 2011 and 2010, VMware paid $14.4 million and $10.6 million,
respectively, of contingent amounts to EMC. We did not revise our segment presentation for prior periods, as the historical impact of the acquired business
was not material to the VMware Virtual Infrastructure segment.
Our segment information for the years ended 2011, 2010 and 2009 are as follows (tables in thousands, except percentages):
EMC Information Infrastructure
2011:
Information
Storage
Information
Intelligence
Group
RSA
Information
Security
EMC
Information
Infrastructure
VMware
Virtual
Infrastructure
within EMC
Corp
Reconciling
Items Consolidated
Revenues:
Product revenues $10,090,338 $ 219,472 $ 440,790 $10,750,600 $ 1,840,142 $ — $12,590,742
Services revenues 4,623,842 482,879 387,413 5,494,134 1,922,712 — 7,416,846
Total consolidated revenues 14,714,180 702,351 828,203 16,244,734 3,762,854 — 20,007,588
Cost of sales 6,414,305 250,995 357,669 7,022,969 533,329 282,348 7,838,646
Gross profit $ 8,299,875 $ 451,356 $ 470,534 9,221,765 3,229,525 (282,348) 12,168,942
Gross profit percentage 56.4% 64.3% 56.8% 56.8% 85.8% — 60.8%
Research and development 1,239,333 587,902 322,552 2,149,787
Selling, general and administrative 4,392,205 1,480,792 606,385 6,479,382
Restructuring and acquisition-related charges — — 97,334 97,334
Total costs and expenses 5,631,538 2,068,694 1,026,271 8,726,503
Operating income 3,590,227 1,160,831 (1,308,619) 3,442,439
Other income (expense), net (148,924) 6,734 (50,979) (193,169)
Income before tax 3,441,303 1,167,565 (1,359,598) 3,249,270
Income tax provision 860,713 128,634 (348,962) 640,385
Net income 2,580,590 1,038,931 (1,010,636) 2,608,885
Net income attributable to the non-controlling
interest in VMware, Inc. — (208,894) 61,346 (147,548)
Net income attributable to EMC Corporation $ 2,580,590 $ 830,037 $ (949,290) $ 2,461,337
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