VMware sales up 20% but profit drops

Virtualisation software vendor Vmware grew revenues 20% year-on-year during the three months ending September 30, up to $1.13 billion. Net income slid 12%, however, from $178 million to $157 million during the quarter.

Vmware saw revenue from licensing services reach $491 million in 2012, up 11% year-on-year. Services revenues increased 29% to $643 million during the quarter.

VMware’s share price fell short of analysts’ expectations, Reuters reported, who had forecast $1.13 billion in revenue and earnings of 63 cents per share.

Carl Eschenbach, VMware’s chief operating officer, said the company “delivered a solid quarter despite tough macroeconomic conditions”. “The quarter went as expected and we achieved record quarterly results for total revenue and non-GAAP operating income,” he said.

The results "reinforce VMware’s leadership and momentum as cloud emerges as the de facto IT infrastructure standard,” said CEO Pat Gelsinger.

The company forecast fourth quarter revenue of $1.26 billion to $1.29 billion, compared with analysts’ expectations of $1.28 billion, according to Thomson Reuters I/B/E/S, with licence revenues expected to grow between 12.8% and 13.8%.

It also announced Jonathan Chadwick as its new chief financial officer. Chadwick has previously held the role of corporate vice president and Microsoft and the CFO of Skype, and other senior roles at McAfee and Cisco Systems.

Pete Swabey

Pete Swabey

Pete was Editor of Information Age and head of technology research for Vitesse Media plc from 2005 to 2013, before moving on to be Senior Editor and then Editorial Director at The Economist Intelligence...

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