By RTT News, October 21, 2013, 05:00:00 PM EDT
(RTTNews.com) - Virtualization software maker VMware Inc. ( VMW ), Monday reported a better-than-expected increase in third-quarter profit, helped by a fourteen percent growth in revenue. Both software license and services segments fared well, with revenue coming in line with Wall Street estimates.
Moving forward, VMware said prospects for the remainder of 2013 appear bright as it sees robust customer demand for new solutions.
Shares of the company gained 4 percent in after-hours trading on the New York Stock Exchange.
CEO Pat Gelsinger said, "VMware continues to build momentum globally, because we are uniquely positioned to help our customers transform to the mobile-cloud era of computing."
VMware provides virtualization-based cloud infrastructure solutions and its software enables businesses to enhance the efficiency of their information technology systems. While the company has been in the limelight, it now sees rivalry from the likes of Microsoft ( MSFT ) and Oracle ( ORCL ).
The Palo Alto, California-based company reported third-quarter net income of $261 million or $0.60 per share, compared with $157 million or $0.36 per share last year.
Excluding items, adjusted earnings for the quarter were $363 million or $0.84 per share, compared with $303 million or $0.70 per share in the prior year.
On average, 42 analysts polled by Thomson Reuters estimated earnings of $0.82 per share for the quarter. Analysts' estimates typically exclude special items.
Revenue for the quarter climbed 14 percent to $1.29 billion from $1.13 billion a year ago. Analysts had a consensus revenue estimate of $ billion. Forty-two 40 analysts had a consensus revenue of $1.29 billion for the quarter.
Both licensing and service revenue fared well compared with last year, the company said.
Earlier this month, VMware acquired Desktone Inc., which provides the industry's only multi-tenant desktop virtualization platform for delivering desktops and applications as a cloud service, enabling the deployment of Windows desktops and applications from a private, public or hybrid cloud to any end user device.
VMware stock closed Monday at $82.69, up $1.26 or 1.55%, on a volume of 3.9 million shares on the NYSE. In after hours, the stock gained $3.35 or 4.05% at $86.00. In the past year, stock has traded in the range of $64.86 - $99.55.
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