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Segment, Geographic, and Significant Customer Information
 6 Months Ended
Oct. 28, 2022
Segment Reporting [Abstract]  
Segment, Geographic, and Significant Customer Information

14. Segment, Geographic, and Significant Customer Information

Our operations are organized into two segments: Hybrid Cloud and Public Cloud. The two segments are based on the information reviewed by our Chief Operating Decision Maker (CODM), who is the Chief Executive Officer, to evaluate results and allocate resources. The CODM measures performance of each segment based on segment revenue and segment gross profit. We do not allocate to our segments certain cost of revenues which we manage at the corporate level. These unallocated costs include stock-based compensation and amortization of intangible assets. We do not allocate assets to our segments.

Hybrid Cloud offers a portfolio of storage and infrastructure solutions that help customers recast their data centers with the power of cloud. This portfolio is designed to operate with public clouds to unlock the potential of hybrid, multi-cloud operations. Hybrid Cloud is composed of software, hardware, and related support, as well as professional and other services.

Public Cloud offers a portfolio of products delivered primarily as-a-service, including related support. This portfolio includes cloud storage and data services, and cloud operations services.

Segment Revenues and Gross Profit

Financial information by segment is as follows (in millions, except percentages):

 

Three Months Ended October 28, 2022

 

 

Hybrid Cloud

 

 

Public Cloud

 

 

Consolidated

 

Product revenues

$

837

 

 

$

—

 

 

$

837

 

Support revenues

 

607

 

 

 

—

 

 

 

607

 

Professional and other services revenues

 

77

 

 

 

—

 

 

 

77

 

Public cloud revenues

 

—

 

 

 

142

 

 

 

142

 

     Net revenues

 

1,521

 

 

 

142

 

 

 

1,663

 

Cost of product revenues

 

417

 

 

 

—

 

 

 

417

 

Cost of support revenues

 

45

 

 

 

—

 

 

 

45

 

Cost of professional and other services revenues

 

54

 

 

 

—

 

 

 

54

 

Cost of public cloud revenues

 

—

 

 

 

45

 

 

 

45

 

     Segment cost of revenues

 

516

 

 

 

45

 

 

 

561

 

         Segment gross profit

$

1,005

 

 

$

97

 

 

$

1,102

 

         Segment gross margin

 

66.1

%

 

 

68.3

%

 

 

66.3

%

            Unallocated cost of revenues1

 

 

 

 

 

 

 

15

 

                   Total gross profit

 

 

 

 

 

 

$

1,087

 

                   Total gross margin

 

 

 

 

 

 

 

65.4

%

1 Unallocated cost of revenues are composed of $5 million of stock-based compensation expense and $10 million of amortization of intangible assets.

 

 

 

Three Months Ended October 29, 2021

 

 

Hybrid Cloud

 

 

Public Cloud

 

 

Consolidated

 

Product revenues

$

814

 

 

$

—

 

 

$

814

 

Support revenues

 

590

 

 

 

—

 

 

 

590

 

Professional and other services revenues

 

75

 

 

 

—

 

 

 

75

 

Public cloud revenues

 

—

 

 

 

87

 

 

 

87

 

     Net revenues

 

1,479

 

 

 

87

 

 

 

1,566

 

Cost of product revenues

 

369

 

 

 

—

 

 

 

369

 

Cost of support revenues

 

48

 

 

 

—

 

 

 

48

 

Cost of professional and other services revenues

 

54

 

 

 

—

 

 

 

54

 

Cost of public cloud revenues

 

—

 

 

 

25

 

 

 

25

 

     Segment cost of revenues

 

471

 

 

 

25

 

 

 

496

 

         Segment gross profit

$

1,008

 

 

$

62

 

 

$

1,070

 

         Segment gross margin

 

68.2

%

 

 

71.3

%

 

 

68.3

%

            Unallocated cost of revenues1

 

 

 

 

 

 

 

11

 

                   Total gross profit

 

 

 

 

 

 

$

1,059

 

                   Total gross margin

 

 

 

 

 

 

 

67.6

%

1 Unallocated cost of revenues are composed of $4 million of stock-based compensation expense and $7 million of amortization of intangible assets.

 

 

 

Six Months Ended October 28, 2022

 

 

Hybrid Cloud

 

 

Public Cloud

 

 

Consolidated

 

Product revenues

$

1,623

 

 

$

—

 

 

$

1,623

 

Support revenues

 

1,205

 

 

 

—

 

 

 

1,205

 

Professional and other services revenues

 

153

 

 

 

—

 

 

 

153

 

Public cloud revenues

 

—

 

 

 

274

 

 

 

274

 

     Net revenues

 

2,981

 

 

 

274

 

 

 

3,255

 

Cost of product revenues

 

812

 

 

 

—

 

 

 

812

 

Cost of support revenues

 

88

 

 

 

—

 

 

 

88

 

Cost of professional and other services revenues

 

106

 

 

 

—

 

 

 

106

 

Cost of public cloud revenues

 

—

 

 

 

85

 

 

 

85

 

     Segment cost of revenues

 

1,006

 

 

 

85

 

 

 

1,091

 

         Segment gross profit

$

1,975

 

 

$

189

 

 

$

2,164

 

         Segment gross margin

 

66.3

%

 

 

69.0

%

 

 

66.5

%

            Unallocated cost of revenues1

 

 

 

 

 

 

 

31

 

                   Total gross profit

 

 

 

 

 

 

$

2,133

 

                   Total gross margin

 

 

 

 

 

 

 

65.5

%

1 Unallocated cost of revenues are composed of $10 million of stock-based compensation expense and $21 million of amortization of intangible assets.

 

 

 

 

Six Months Ended October 29, 2021

 

 

Hybrid Cloud

 

 

Public Cloud

 

 

Consolidated

 

Product revenues

$

1,544

 

 

$

—

 

 

$

1,544

 

Support revenues

 

1,168

 

 

 

—

 

 

 

1,168

 

Professional and other services revenues

 

146

 

 

 

—

 

 

 

146

 

Public cloud revenues

 

—

 

 

 

166

 

 

 

166

 

     Net revenues

 

2,858

 

 

 

166

 

 

 

3,024

 

Cost of product revenues

 

695

 

 

 

—

 

 

 

695

 

Cost of support revenues

 

96

 

 

 

—

 

 

 

96

 

Cost of professional and other services revenues

 

105

 

 

 

—

 

 

 

105

 

Cost of public cloud revenues

 

—

 

 

 

48

 

 

 

48

 

     Segment cost of revenues

 

896

 

 

 

48

 

 

 

944

 

         Segment gross profit

$

1,962

 

 

$

118

 

 

$

2,080

 

         Segment gross margin

 

68.6

%

 

 

71.1

%

 

 

68.8

%

            Unallocated cost of revenues1

 

 

 

 

 

 

 

22

 

                   Total gross profit

 

 

 

 

 

 

$

2,058

 

                   Total gross margin

 

 

 

 

 

 

 

68.1

%

1 Unallocated cost of revenues are composed of $8 million of stock-based compensation expense and $14 million of amortization of intangible assets.

 

 

Geographical Revenues and Certain Assets

Revenues summarized by geographic region are as follows (in millions):

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

October 28,
 2022

 

 

October 29,
2021

 

 

October 28,
 2022

 

 

October 29,
2021

 

United States, Canada and Latin America (Americas)

 

$

889

 

 

$

868

 

 

$

1,745

 

 

$

1,654

 

Europe, Middle East and Africa (EMEA)

 

 

535

 

 

 

461

 

 

 

1,035

 

 

 

915

 

Asia Pacific (APAC)

 

 

239

 

 

 

237

 

 

 

475

 

 

 

455

 

Net revenues

 

$

1,663

 

 

$

1,566

 

 

$

3,255

 

 

$

3,024

 

Americas revenues consist of sales to Americas commercial and U.S. public sector markets. Sales to customers inside the U.S. were $769 million and $773 million during the three months ended October 28, 2022 and October 29, 2021, respectively, and were $1,527 million and $1,469 million during the six months ended October 28, 2022 and October 29, 2021, respectively.

The majority of our assets, excluding cash, cash equivalents, short-term investments and accounts receivable, were attributable to our domestic operations. The following table presents cash, cash equivalents and short-term investments held in the U.S. and internationally in various foreign subsidiaries (in millions):

 

 

October 28,
 2022

 

 

April 29,
 2022

 

U.S.

 

$

1,590

 

 

$

1,820

 

International

 

 

1,443

 

 

 

2,314

 

Total

 

$

3,033

 

 

$

4,134

 

With the exception of property and equipment, we do not identify or allocate our long-lived assets by geographic area. The following table presents property and equipment information for geographic areas based on the physical location of the assets (in millions):

 

 

October 28,
 2022

 

 

April 29,
 2022

 

U.S.

 

$

431

 

 

$

392

 

International

 

 

230

 

 

 

210

 

Total

 

$

661

 

 

$

602

 

 

Significant Customers

The following customers, each of which is a distributor, accounted for 10% or more of our net revenues:

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

October 28,
 2022

 

 

October 29,
2021

 

 

October 28,
 2022

 

 

October 29,
2021

 

Arrow Electronics, Inc.

 

 

24

%

 

 

24

%

 

 

25

%

 

 

24

%

Tech Data Corporation

 

 

20

%

 

 

20

%

 

 

20

%

 

 

20

%

The following customers accounted for 10% or more of accounts receivable in at least one of the periods presented:

 

 

October 28,
 2022

 

 

April 29,
 2022

 

Arrow Electronics, Inc.

 

 

15

%

 

 

10

%

Tech Data Corporation

 

 

19

%

 

 

19

%