Dell Technologies (NYSE: DELL) announces financial results for its fiscal 2023 third quarter. Revenue was$24.7 billion, down 6%. Operating income was a record$1.8 billion, up 68%, representing 7.1% of revenue, and non-GAAP operating income was a record$2.4 billion, up 22%, representing 9.6% of revenue. Net income from continuing operations was$241 million, and non-GAAP net income was$1.7 billion. Diluted earnings per share was$0.33, and non-GAAP diluted earnings per share was$2.30.

Dell Technologies ended the quarter with remaining performance obligations of$39 billion and deferred revenue of$27.1 billion. Recurring revenue for the third quarter was approximately$5.4 billion, up 11% year-over-year. Cash and investments were$6.5 billion, and$847 million was returned to shareholders in the third quarter through share repurchases and dividends

Third Quarter Fiscal 2023 Financial Results

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During the three and nine months ended October 28, 2022, net income from continuing operations and earnings per share-diluted include a$1.0 billion expense recognized within interest and other, net, in connection with a previously reported litigation settlement agreement.

Information about Dell Technologies' use of non-GAAP financial information is provided under "Non-GAAP Financial Measures" below. All comparisons in this press release are year-over-year unless otherwise noted.

Operating segments summary

Infrastructure Solutions Groupdelivered record third quarter revenue of$9.6 billion, up 12% year-over-year and its seventh consecutive quarter of year-over-year growth. Servers and networking revenue was$5.2 billion, up 14%. Storage revenue was$4.4 billion, up 11%. Operating income was a record$1.4 billion, up 54% and approximately 14.3% of Infrastructure Solutions Group revenue. 

• Client Solutions Groupdelivered third quarter revenue of$13.8 billion, down 17% year-over-year. Commercial revenue was$10.7 billion, down 13%, and Consumer revenue was$3 billion, down 29%. Operating income was$1.1 billion, down 7% and approximately 7.7% of Client Solutions Group revenue.  

Key areas of innovation:

• Dell launchedCybersecurity Advisory Services and a new vulnerability management service, providing organizations with tools and actionable insights to secure their IT environments.
• As part of continuing APEX momentum,Dell PowerFlex block storageis now available in the AWS Marketplace.
• Dell added acustomer-managed option for APEX Data Storage Services, helping customers easily transition to an as-a-Service environment.
• Dell announcedProject Frontier, an edge operations software platform that centralizes customers' software applications, operational technologies and multicloud environments with Zero Trust-enabled security protection to securely scale edge operations for any enterprise use case.
• As part of Dell's edge portfolio, theLatitude 7230 Rugged Extreme Tabletis now available and is the lightest and most powerful 12" fully rugged tablet on the market, offering more speed and reduced energy consumption for workers in extreme environments.

Executive Quotes:

• "We played our hand in Q3 exceptionally well; it's what we do," said Jeff Clarke, vice chairman and co-chief operating officer, Dell Technologies. "We reduced backlog to meet customer needs and deliver record business results, including record third quarter ISG revenue of$9.6 billion. At the same time, our innovation engine is operating at full throttle in strategic areas like edge, multicloud and as-a-Service."
• "We executed Q3 with focus and delivered strong operating results, successfully navigating the challenging environment we highlighted in our Q2 earnings call," said Chuck Whitten, co-chief operating officer, Dell Technologies. "With the industry's largest direct sales force and our technology ecosystem, we anticipated the changing landscape and responded quickly. We combatted slower demand and drove record profitability, with record operating income of$1.8 billion."
• "We continue to perform well in any environment, driving record operating income and growing revenue 6% year-to-date to$77 billion," said Tom Sweet, chief financial officer, Dell Technologies. "We're creating long-term value with strong share positions in the most profitable parts of the market, generating solid free cash flow over time and returning capital to shareholders."

Conference call information

As previously announced, the Company will hold a conference call to discuss its performance and financial guidance on Nov. 21, 2022, at 3:30 p.m. CST. Prior to the start of the conference call, prepared remarks and a presentation containing additional financial and operating information prior to financial guidance may be downloaded from investors.delltechnologies.com. The conference call will be broadcast live over the internet and can be accessed at 

https://investors.delltechnologies.com/events-and-presentations/upcoming-events   

For those unable to listen to the live broadcast, the final remarks and presentation with financial guidance will be available following the broadcast, and an archived version will be available at the same location for one year.

Customer Highlights Blog

Read our quarterly blog from Bill Scannell, Dell Technologies president of Global Sales & Customer Operations, to learn more about how we are helping customers with their digital transformations:

https://www.dell.com/en-us/blog/driving-our-customers-businesses-forward/

Environmental, Social and Governance (ESG)

Our Environmental, Social and Governance (ESG) efforts focus on driving positive impact for people and our planet while delivering long-term value for our stakeholders. Explore our ESG resources at

https://www.dell.com/en-us/dt/corporate/social-impact/reporting/esg-governance.htm

Copyright ? 2022 Dell Inc. or its subsidiaries. All Rights Reserved. Dell Technologies, Dell, EMC and Dell EMC are trademarks of Dell Inc. or its subsidiaries. Other trademarks may be trademarks of their respective owners. 

Non-GAAP Financial Measures:

This press release presents information about Dell Technologies' non-GAAP net revenue, non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating income, non-GAAP net income, non-GAAP net income attributable to non-controlling interests, non-GAAP net income attributable to Dell Technologies Inc. - basic, non-GAAP net income attributable to Dell Technologies Inc. - diluted, non-GAAP earnings per share attributable to Dell Technologies Inc. - basic, and non-GAAP earnings per share attributable to Dell Technologies Inc. - diluted, which are non-GAAP financial measures provided as a supplement to the results provided in accordance with generally accepted accounting principles in the United States of America ("GAAP"). A reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure is provided in the attached tables for each of the fiscal periods indicated.

Special Note on Forward-Looking Statements:

Statements in this press release that relate to future results and events are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933 and are based on Dell Technologies' current expectations. In some cases, you can identify these statements by such forward-looking words as "anticipate," "believe," "confidence," "could," "estimate," "expect," "guidance," "intend," "may," "objective," "outlook," "plan," "project," "possible," "potential," "should," "will" and "would," or similar words or expressions that refer to future events or outcomes.

Dell Technologies' results or events in future periods could differ materially from those expressed or implied by these forward-looking statements because of risks, uncertainties, and other factors that include, but are not limited to, the following: risks and uncertainties relating to our spin-off of VMware, Inc., including the potential effects on our business of the transaction; the effects of the COVID-19 pandemic; competitive pressures; Dell Technologies' reliance on third-party suppliers for products and components, including reliance on single-source or limited-source suppliers; Dell Technologies' ability to achieve favorable pricing from its vendors; adverse global economic conditions and instability in financial markets; Dell Technologies' execution of its growth, business and acquisition strategies; the success of Dell Technologies' cost efficiency measures; Dell Technologies' ability to manage solutions and products and services transitions in an effective manner; Dell Technologies' ability to deliver high-quality products, software, and services; cyber attacks or other data security incidents; Dell Technologies' foreign operations and ability to generate substantial non-U.S. net revenue; Dell Technologies' product, services, customer, and geographic sales mix, and seasonal sales trends; the performance of Dell Technologies' sales channel partners; access to the capital markets by Dell Technologies or its customers; material impairment of the value of goodwill or intangible assets; weak economic conditions and the effect of additional regulation on Dell Technologies' financial services activities; counterparty default risks; the loss by Dell Technologies of any contracts for ISG services and solutions and its ability to perform such contracts at their estimated costs; loss by Dell Technologies of government contracts; Dell Technologies' ability to develop and protect its proprietary intellectual property or obtain licenses to intellectual property developed by others on commercially reasonable and competitive terms; disruptions in Dell Technologies' infrastructure; Dell Technologies' ability to hedge effectively its exposure to fluctuations in foreign currency exchange rates and interest rates; expiration of tax holidays or favorable tax rate structures, or unfavorable outcomes in tax audits and other tax compliance matters; impairment of portfolio investments; unfavorable results of legal proceedings, including the risk associated with final court approval of the recently announced litigation settlement; compliance requirements of changing environmental and safety laws or other laws; the effect of armed hostilities, terrorism, natural disasters, and public health issues; the effect of global climate change and legal, regulatory, or market measures to address climate change; Dell Technologies' dependence on the services of Michael Dell and key employees; Dell Technologies' level of indebtedness; the effect of the transition from LIBOR as a reference rate to calculate interest rates under our variable-rate indebtedness; and business and financial factors and legal restrictions affecting continuation of Dell Technologies' quarterly cash dividend policy and dividend rate.

This list of risks, uncertainties, and other factors is not complete. Dell Technologies discusses some of these matters more fully, as well as certain risk factors that could affect Dell Technologies' business, financial condition, results of operations, and prospects, in its reports filed with the SEC, including Dell Technologies' annual report on Form 10-K for the fiscal year ended January 28, 2022, quarterly reports on Form 10-Q, and current reports on Form 8-K. These filings are available for review through the SEC's website at www.sec.gov. Any or all forward-looking statements Dell Technologies makes may turn out to be wrong and can be affected by inaccurate assumptions Dell Technologies might make or by known or unknown risks, uncertainties and other factors, including those identified in this press release. Accordingly, you should not place undue reliance on the forward-looking statements made in this press release, which speak only as of its date. Dell Technologies does not undertake to update, and expressly disclaims any duty to update, its forward-looking statements, whether as a result of circumstances or