VMware Nearly Triples Profits Over Year-Ago Q2

By Chris Preimesberger  |  Posted 2011-07-19 Print this article Print

VMware's CFO says earnings were driven by record enterprise license-agreement bookings across all geographic markets. Q3 projections look equally rosy.

Enterprise virtualization software provider VMware (NYSE:VMW) posted an impressive quarterly earnings report July 19, nearly tripling its profits over the same quarter a year ago.

The Palo Alto, Calif.-based company's net income for the second quarter of 2011 was $220 million, compared with $75 million in 2010.

VMware's revenue in its fiscal Q2 climbed to $921 million, yielding 51 cents per share and representing an increase of 37 percent from the second quarter of 2010. The analysts' consensus was in the neighborhood of $873 million in revenue and 47 cents per share.

For Q3 2011, VMware's CFO Mark Peek said the company projects another 30 percent rise in revenue, ranging from $915 million to $940 million-well ahead of the average $899 million estimate by Wall Street analysts.

Peek said earnings were driven by record enterprise license-agreement bookings as a percentage of total bookings across all geographic markets.

License revenues for the quarter were $465 million, an increase of 44 percent from the second quarter of 2010 as reported, and an increase of 40 percent measured in constant currency. Service revenues, which include software maintenance and professional services, were $456 million for the second quarter of 2011, an increase of 30 percent from the second quarter of 2010.

U.S. revenues for the second quarter of 2011 grew 35 percent to $450 million from the second quarter of 2010. International revenues grew 38 percent to $471 million from the second quarter of 2010.

Chris Preimesberger Chris Preimesberger was named Editor-in-Chief of Features & Analysis at eWEEK in November 2011. Previously he served eWEEK as Senior Writer, covering a range of IT sectors that include data center systems, cloud computing, storage, virtualization, green IT, e-discovery and IT governance. His blog, Storage Station, is considered a go-to information source. Chris won a national Folio Award for magazine writing in November 2011 for a cover story on Salesforce.com and CEO-founder Marc Benioff, and he has served as a judge for the SIIA Codie Awards since 2005. In previous IT journalism, Chris was a founding editor of both IT Manager's Journal and DevX.com and was managing editor of Software Development magazine. His diverse resume also includes: sportswriter for the Los Angeles Daily News, covering NCAA and NBA basketball, television critic for the Palo Alto Times Tribune, and Sports Information Director at Stanford University. He has served as a correspondent for The Associated Press, covering Stanford and NCAA tournament basketball, since 1983. He has covered a number of major events, including the 1984 Democratic National Convention, a Presidential press conference at the White House in 1993, the Emmy Awards (three times), two Rose Bowls, the Fiesta Bowl, several NCAA men's and women's basketball tournaments, a Formula One Grand Prix auto race, a heavyweight boxing championship bout (Ali vs. Spinks, 1978), and the 1985 Super Bowl. A 1975 graduate of Pepperdine University in Malibu, Calif., Chris has won more than a dozen regional and national awards for his work. He and his wife, Rebecca, have four children and reside in Redwood City, Calif.Follow on Twitter: editingwhiz

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