VMware Reports 67 Percent Profit Increase

By Chris Preimesberger  |  Posted 2012-01-23 Print this article Print

VMware posted quarterly net income of $200 million (46 cents per share) -- up from $120 million (28 cents per share) in the same period a year earlier.

VMware, the world's largest virtualization software and services provider, popped open at least a few people's eyes Jan. 23 when it announced a whopping 67 percent year-over-year net income increase in its fourth-quarter 2011 earnings report.

Continued growth in service and license revenue to go with larger profit margins helped VMware post quarterly net income of $200 million (46 cents per share)-up from $120 million (28 cents per share) in the same period a year earlier.

Overhead for its business remains high, however. Total revenue was reported at $1.06 billion, which was up 27 percent from Q4 2010.

Hot-selling products and services that fit into the cloud computing category, led by the company's vCenter and vSphere management platforms, were the main reasons for the sales increases.

In a conference call to reporters and analysts, CEO Paul Maritz and CFO Mark Peek both mentioned three Q4 product releases-vCenter Operations, vFabric Application Management and the IT Business Management suites-as keys to the company's steady financial upward climb.

The Palo Alto, Calif.-based company-which did its part for the overall U.S. IT economy by adding 2,000 employees in 2011, 600 from acquisitions-is placing more of its strategic emphasis into the cloud-building sector, and its earnings reports mirror the overall growth of the cloud sector. VMware's hypervisor and tools work with virtually all other hardware and software makers' products.

VMware's common stock closed at an even $86.00 but had jumped 5 percent to $90.35 in after-hours trading on Jan. 23.


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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