VMware Profit Tops Estimates as Overseas Sales Surge (Update1)
By Katie Hoffmann
Oct. 21 (Bloomberg) -- VMware Inc., the biggest maker of programs that let computers run multiple operating systems, posted profit and sales that topped analysts' estimates as orders overseas surged.
The stock climbed as much as 26 percent after VMware said third-quarter profit, excluding costs such as stock-based compensation, amounted to 24 cents a share. Analysts on average estimated 20 cents, according to a Bloomberg survey. Sales rose 32 percent to $472.1 million, also beating projections.
International revenue climbed 42 percent, almost twice the pace of U.S. growth. The results show that VMware's business is withstanding ``the challenging economic environment,'' Chief Executive Officer Paul Maritz said in the statement.
VMware maintained its full-year sales forecast of 42 percent to 45 percent sales growth. The company warned that the economic slump may push revenue to the lower end of that range. More than 40 percent of companies have trimmed technology budgets in the past year to cope with the slowdown, according to researcher Forrester Research Inc. in Cambridge, Massachusetts.
Palo Alto, California-based VMware rose as much as $4.96 to $23.69 in extended trading after closing at $18.73 on the New York Stock Exchange. The stock has dropped 78 percent this year.
Net income climbed 29 percent to $83.3 million, or 21 cents a share, from $64.7 million, or 18 cents, a year earlier, VMware said today in a statement.
U.S. sales climbed 24 percent to $249 million, accounting for more than half of the total. Revenue abroad amounted to $224 million.
VMware is majority-owned by EMC Corp., which spun off the company last year in the biggest U.S. technology initial public offering since Google Inc.'s in 2004.
(The company will hold a conference call to discuss the results at 5 p.m. New York time. To listen in, go to ir.vmware.com.)
To contact the reporter on this story: Katie Hoffmann in New York at khoffmann4@bloomberg.net
Last Updated: October 21, 2008 16:42 EDT |
