In what might be one of its last quarters as an independent public company, VMware gave investors something to smile about as they contemplate its future within the Dell Technologies conglomerate.
For the period ending Feb. 2nd, VMware recorded $2.31 billion in revenue, a 14 percent jump compared to the previous year and just ahead of analyst expectations of $2.26 billion, according to Yahoo Finance. Licensing revenue grew 20 percent as virtualization software continues to be a key technology in the public and hybrid cloud worlds.
The company posted a substantial net loss during the quarter, but you can chalk that up to the effect of new U.S. tax laws passed in December that allow companies to repatriate cash and take a one-time tax hit. Excluding the effect of that charge, net income was $691 million, or earnings per share of $1.68. Analysts were expecting $1.62.
In the bigger picture, however, CNBC reported Thursday that VMware parent Dell Technologies is considering a complicated reverse merger in which would combine the two companies in a single public entity. VMware shareholders were not impressed by the potential deal, which comes after weeks of trial balloons about possible combinations that would shake up the massive financial engineering project that is the Dell Technologies conglomerate.
During a conference call following the presentation of the results, VMware CEO Pat Gelsinger said that the company’s expanded partnership with Amazon Web Services contributed to its revenue growth, as noted by ZDNet. AWS added a second region for VMware customers during the quarter, and the two companies announced an app migration service last November at re:Invent 2017.