Name: EMC Corp. (NYSE:EMC) | Common-Size Income Statement
Creator: Stock Analysis on Net

Common-Size Income Statement

EMC Corp., common-size consolidated income statement

12 months ended:	Dec 31, 2015	Dec 31, 2014	Dec 31, 2013	Dec 31, 2012	Dec 31, 2011
Product sales	54.70%	57.49%	58.95%	60.15%	62.93%
Services	45.30%	42.51%	41.05%	39.85%	37.07%
Revenues	100.00%	100.00%	100.00%	100.00%	100.00%
Cost of product sales	-23.51%	-23.48%	-24.33%	-24.22%	-26.59%
Cost of services	-15.80%	-14.13%	-13.35%	-12.97%	-12.59%
Cost of revenues	-39.32%	-37.61%	-37.68%	-37.19%	-39.18%
Gross profit	60.68%	62.39%	62.32%	62.81%	60.82%
Research and development	-12.82%	-12.24%	-11.89%	-11.79%	-10.74%
Selling, general and administrative	-34.54%	-32.66%	-31.60%	-32.26%	-32.38%
Restructuring and acquisition-related charges	-1.82%	-0.98%	-0.96%	-0.51%	-0.49%
Operating income	11.50%	16.52%	17.87%	18.26%	17.21%
Investment income	0.38%	0.50%	0.55%	0.53%	0.65%
Interest expense	-0.66%	-0.60%	-0.67%	-0.36%	-0.85%
Other income (expense), net	0.45%	-1.03%	-1.11%	-0.90%	-0.76%
Non-operating income (expense)	0.17%	-1.13%	-1.23%	-0.74%	-0.97%
Income before provision for income taxes	11.67%	15.39%	16.64%	17.52%	16.24%
Income tax provision	-2.87%	-3.55%	-3.32%	-4.23%	-3.20%
Net income	8.79%	11.84%	13.32%	13.29%	13.04%
Net income attributable to the non-controlling interests	-0.74%	-0.74%	-0.88%	-0.71%	-0.74%
Net income attributable to EMC Corporation	8.06%	11.10%	12.44%	12.58%	12.30%

Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).

Revenue Composition: Over the analyzed period, a noticeable shift occurred in the revenue mix, with product sales declining as a percentage of total revenues from 62.93% in 2011 to 54.7% in 2015. Conversely, the services component increased steadily from 37.07% to 45.3%, reflecting a gradual strategic emphasis or market trend favoring services.
Cost Structure: The cost of product sales relative to revenues decreased from -26.59% to -23.51%, indicating improved efficiency or cost control in product segments. However, the cost of services increased from -12.59% to -15.8%, which may suggest rising expenses associated with the expanding services business. Overall, the total cost of revenues remained relatively stable but with a slight increase from -39.18% in 2011 to -39.32% in 2015, reflecting these contrasting cost dynamics.
Profitability Metrics: Gross profit margin showed fluctuations but exhibited a general decline towards the end of the period, falling from 60.82% in 2011 to 60.68% in 2015 after peaking around 62.81% in 2012. This decline corresponds with the rising service costs and changes in revenue mix. Operating income as a percentage of revenues decreased significantly from 17.21% to 11.5%, driven by increasing operating expenses and restructuring costs.
Operating Expenses and Charges: Research and development expenses as a percentage of revenues increased steadily from -10.74% to -12.82%, indicating increased investment in innovation or product development. Selling, general and administrative expenses also showed an upward trend, rising from -32.38% to -34.54%, suggesting higher overhead or sales-related expenditures. Restructuring and acquisition-related charges nearly quadrupled, from -0.49% to -1.82%, reflecting increased costs potentially related to organizational changes or acquisitions.
Non-Operating Items: Investment income decreased from 0.65% to 0.38%, indicating reduced returns or scaling back of investments. Interest expense remained relatively low and stable between -0.85% and -0.66%. Other income (expense), net, showed a recovery from negative figures in earlier years to a small positive of 0.45% in 2015. Consequently, total non-operating income (expense) improved from a consistent negative range to a slight positive value in 2015, which may have aided overall profitability.
Income and Taxes: Income before tax decreased from 16.24% to 11.67%, reflecting the combined effects of lower operating income and mixed non-operating results. The income tax provision as a percentage of revenues fluctuated but slightly decreased from -3.2% to -2.87%, possibly due to changes in tax rates or tax planning strategies. Net income displayed a notable decline from 13.04% in 2011 to 8.79% in 2015, further highlighting reduced profitability.
Attribution of Net Income: Net income attributable to non-controlling interests remained relatively stable around -0.74%, indicating consistent minority interests. Net income attributable to the company decreased from 12.3% to 8.06%, mirroring the overall net income trend and underscoring a decline in earnings available to shareholders.

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