VMware Sees Success, As AWS Partnership Pays Off

VMware Building

It’s official, folks. The blockbuster partnership that VMware struck with AWS for hybrid cloud is starting to pay off for the virtualization giant, which just reported a very strong Q4.

The company has positioned itself well as the go-to vendor for hybrid cloud deployments.

Despite the success of the fourth quarter, the company has said that it would not comment on the potential reverse merger with Dell that has been the talk of the town lately. But that is something that will be revealed in time, if there’s any truth to it.

What has truth, is the fourth quarter net loss of $440 million on revenue of $2.31 billion for VMware, which is up a solid 14% from a year ago.

The net loss was due to a $970 million charge related to the Tax Cuts and Jobs Act.

For fiscal year 2018, VMware had earnings of $570 million to report, on revenue of $7.92 billion, which is nicely up 12% from the previous year.

CEO Pat Gelsinger said that the company closed the year strong, landing large deals in the EMEA region. On top of that, the hybrid cloud partnerships that it has with IBM and AWS are paying off as well. This is what he said on the conference call:

“We continue to see customer interest and engagement with VMware Cloud on AWS. Customers across many industries are rapidly embracing VMware Cloud and AWS to enable modern, efficient and hybrid scalable infrastructure for a variety of use cases, including disaster recovery and data center extension. We are also pleased with the traction the VMware Cloud provider program continues to gain. The VMware Cloud provider program and achieved an annual revenue growth rate of over 30% in fiscal year 2018. We are also experiencing great global customer momentum with our VMware Cloud for IBM with customers.”

Good going.

The company made a big deal of its cloud partnership with Amazon Web Services, proving that the virtualization giant had learned from its mistakes of past.

This alliance between two former rivals is all set to go beyond cloud, and has the potential to chart the course for enterprise adoption of cloud in the coming years. For the time being, though, both companies are working to streamline this new offering for the next wave of customers seeking hybrid cloud.