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April 25, 2014

VMware Q1 Profits Increase with Strong Performance in Services, Licensing

VMware saw its Q1 profits increase some 15 percent, with licensing revenue and services among its strongest areas.

The company saw a Q1 profit of $199 million, compared to $173 million for Q1 in 2013. In addition, revenue in the recent quarter increased 14 percent to $1.36 billion. Analysts had expected revenue of $1.35 billion.

Revenue from services increased 14 percent. Services revenue in Q1 was $799 million, compared to $703 million during the same period last year. License revenue increased 15 percent in Q1. It totaled $561 million, compared to $488 million in 2013.

“We are pleased with our first quarter comparable revenue growth of 18 percent as customer adoption across our solutions and services continues to grow,” Jonathan Chadwick, chief financial officer, VMware, said in a statement. “Our integration of AirWatch (News - Alert) and our new product line-up provides customers with the strongest portfolio of products and services in the industry.”

VMware, known for its cloud services and virtualization offerings, is also moving more into mobile-devices. It announced in January it will acquire AirWatch, the mobile device management company, for $1.54 billion. The deal was completed on Feb. 24.

VMware, which majority owned by EMC (News - Alert) Corp., predicts its revenue for this year will be between $5.94 billion and $6.1 billion. And During Q2, VMware predicts revenue will be between $1.42 billion and $1.46 billion, according to ZDNet.

“Our strong financial results reflect VMware’s unique position in helping customers transform their IT infrastructure,” Pat Gelsinger, CEO of VMware, said in a recent statement. “As the industry shifts from client server computing to the mobile-cloud era, customers are choosing our solutions because we have the most complete vision and offering for navigating this evolving world.”

The company saw 2013 revenues of $5.21 billion, and it has over 500,000 customers and 75,000 partners, according to company statements.

Edited by Alisen Downey

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