SHARE

VMware, Citirx Top Investors’ Estimates

Virtualization players VMware and Citrix to demonstrate the relative strength of their market segment, posting second-quarter results above Wall Street estimates. Yet both also showed signs of weakness as the economy took its toll on the bottom line. VMware (NYSE: VMW) reported revenues of $456 million, flat compared to the same period a year ago. […]

Written By

Christopher Saunders

Jul 23, 2009

Datamation content and product recommendations are editorially independent. We may make money when you click on links to our partners. Learn More

Virtualization players VMware and Citrix to demonstrate the relative strength of their market segment, posting second-quarter results above Wall Street estimates.

Yet both also showed signs of weakness as the economy took its toll on the bottom line.

VMware (NYSE: VMW) reported revenues of $456 million, flat compared to the same period a year ago. Income before one-time charges totaled $80 million or $0.20 per share, ahead of analyst consensus of $0.19 per share, according to Reuters Estimates.That’s still down from a year ago, however, when non-GAAP income came to $92 million, or $0.23 per share.

On a GAAP basis, VMware earnings totaled $33 million, or $0.08 per share, down sharply from the $52 million, or $0.13 per share, it posted in Q2 2008.

Citrix (NYSE: CTXS), meanwhile, posted net income of $43 million, or $0.23 per share, compared to $35 million, or $0.18 per diluted share, a year ago. The figures include a restructuring charge of around $2 million.

Minus that and other one-time charges, non-GAAP income totaled $72 million, or $0.39 per share, just ahead of the $71 million, or $0.38 per share, Citrix saw for its second quarter of 2008. Wall Street analysts had been expecting income of $0.38 per share on revenue of $386.2 million, according to Reuters Estimates.

“I’m pleased with our second quarter results,” said Mark Templeton, president and chief executive officer for Citrix. “We are still in a tough economic climate, especially in the EMEA market, but our customers are embracing IT as an on-demand service, confirming our strategy around desktop virtualization, the next generation datacenter and SaaS.”

For VMware, the quarter showed relative staying power in services revenues — software revenues and professional services — which grew 32 percent from last year to total $228 million. However, license revenues also dropped by 228 million, a decline of 20 percent, which the company attributed to the withering economic environment.

“Once again we executed well, driving strong cash flows while continuing to invest in our long-term growth opportunities,” VMware CFO Mark Peek said in a statement.

Likewise, Citrix said its product license revenue decreased 15 percent, while license update revenue grew 9 percent and online services revenue increased 18 percent. The company’s technical services revenue — consulting, education and technical support — also grew 3 percent.

Citrix executives said third-quarter and full-year revenue should come in flat compared to a year ago.

VMware’s Peek said Q3 revenues should come in between $465 million and $480 million, while full-year revenues will grow 1 percent to 3 percent over last year.

Article courtesy of InternetNews.com.