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VMware, Inc. (VMW)
Q1 2018 Results Earnings Conference Call
June 01, 2017, 05:00 PM ET
Paul Ziots - VP of Investor Relations
Patrick Gelsinger - Chief Executive Officer
Zane Rowe - Executive Vice President and Chief Financial Officer
Keith Weiss - Morgan Stanley
John DiFucci - Jefferies
Walter Pritchard - Citi
Matthew Coss - JPMorgan
Matt Hedberg - RBC Capital Markets
Raimo Lenschow - Barclays
Ted Lynn - Goldman Sachs
Michael Tourette - Raymond James
Greg Moscowitz - Cowen and Company
Jayson Noland - Robert W. Baird
Nehal Chokshi - Maxim Group
Abhey Lamba - Mizuho Securities
Srini Nandury - Summit Redstone Partners
Good day, and welcome to the VMware First Quarter Fiscal Year 2018 Earnings Conference Call. Today's conference is being recorded.
At this time, I'd like to turn the conference over to Mr. Paul Ziots, VP of Investor Relations. Please go ahead, sir.
Previous Statements by VMW
» VMware (VMW) Q4 2016 Results - Earnings Call Transcript
» VMWare's (VMW) CEO Pat Gelsinger on Q3 2016 Results - Earnings Call Transcript
» VMware's (VMW) CEO Patrick Gelsinger on Q2 2016 Results - Earnings Call Transcript
Our press release was issued after close of market and is posted on our website where this call is being simultaneously webcast. Slides which accompany this webcast can be viewed in conjunction with live remarks and can also be downloaded at the conclusion of the webcast from ir.vmware.com.
On this call today, we will make forward-looking statements that are subject to risks and uncertainties. Actual results may differ materially as a result of various risk factors including those described in the 10-Ks, 10-Qs and 8-Ks VMware files with the SEC. We assume no obligation to and do not currently intend to update any such forward-looking statements.
In addition, during today's call, we will discuss certain non-GAAP financial measures. These non-GAAP financial measures which are used as measures of VMware's performance should be considered in addition to, not as a substitute for or in isolation from GAAP measures. Our non-GAAP measures exclude the effect on our GAAP results of stock-based compensation, amortization of acquired intangible assets, employer payroll tax on employee stock transactions, acquisition, divestitures and other related items, and gain on share repurchase and include non-GAAP tax rate adjustments. You can find additional disclosures regarding these non-GAAP measures including reconciliations with comparable GAAP measures in the press release and on our Investor Relations website.
A webcast replay of this call will be available for the next 60 days on our company website under the Investor Relations link. Our second quarter fiscal 2018 quiet period begins at the close of business Thursday, July 20, 2017. VMware revised its fiscal calendar effective January 1, 2017. VMware’s first fiscal year under its revised fiscal calendar began on February 4, 2017 and will end February 2, 2018. The period from January 1, 2017 through February 3, 2017 has been recorded as a transition period and will be reported as a separate period in VMware’s Form 10-Q filing for the first quarter of fiscal 2018.
Year-over-year comparisons of quarterly financial results included on this call compare results for VMware’s fiscal 2018 first quarter February 4 through May 5, 2017 to VMware’s fiscal 2016 first quarter January 1 through March 31, 2016. Sequential changes in total unearned revenue and unearned licensed revenue for the first quarter of 2018 compare VMware’s total unearned revenue and unearned licensed revenue balances as of February 3, 2017 the last day of the transition period to the respective balances as of May 5, 2017 the last day of VMware’s fiscal 2018 first quarter.
With that, I'll turn it over to Pat.
Thank you, Paul, and good afternoon, everyone. We are very pleased with our strong Q1 results. Revenue grew 9% year-over-year with non-GAAP earnings of $0.99 per share. In terms of regional bookings, we have strong balanced results across geographies and were particularly pleased with the performance in the Americas this quarter. We are confident about our outlook and growth opportunities, our strategy is resonating and our execution remains strong.
Looking back on Q1, I am particularly pleased with the volume of expanding strategic partnerships we announced in addition to the positive momentum across our portfolio. In early May, the OVH Group, a global hyper-scale cloud provider and the VMware, vCloud Air Network partner, acquired VMware’s vCloud Air, this included data center and customer operations, customers and an enterprise-ready support team. We will continue to support customers and provide technology differentiation to the OVH team as part of VMware’s thriving and global vCloud Air network program which we retained.
We also announced three enduser computing partnerships helping to expand the AirWatch footprint as well as Workspace ONE. Google and VMware are working together to accelerate the adoption of Chromebooks while Oracle and VMware are collaborating to enable advanced security features and streamline management of Oracle mobile enterprise applications.
Most recently we announced the collaboration with Microsoft to deliver Horizon Cloud on Azure, bringing VMware virtual desktops and applications to Azure users. We also announced new integrations with Dell EMC to accelerate workplace transformation. These partnerships will accelerate the momentum we are seeing in our EUC products as will our acquisition of Apteligent, an innovator in mobile application performance and engagement insights.
Overall the EUC business saw strong growth this quarter and some of our largest deals were led by EUC. Additionally, at Dell EMC we already announced an integration of VMware software defined data center and Pivotal Cloud Foundry designed to deliver Developer-Ready Infrastructure.
Developer-Ready Infrastructure represents a significant joint engineering effort between VMware and Pivotal at the intersection of developers and IT. Developers are able to drive agility with a modern cloud native application platform from pivotal, while IT has peace of mind knowing that it runs on a secure software defined data center pioneered by VMware, the first example of this integration is with NSX.