VMware delivers solid Q3, rides software defined data center

Summary: VMware CFO Jonathan Chadwick said "we are seeing strong customer demand for new solutions such as the software-defined data center" and that the prospects for the rest of the year are strong.

VMware's third quarter results were better than expected as sales surged 14 percent from a year ago.

The company reported third quarter earnings of $261 million, or 60 cents a share, on revenue of $1.29 billion, up 14 percent from a year ago. Non-GAAP earnings were 84 cents a share.

Wall Street was looking for non-GAAP earnings of 82 cents a share on revenue of $1.288 billion in the third quarter.

VMware, which exited the quarter with cash and equivalents of $5.84 billion, said that 2013 is playing out as expected. In a statement, VMware CFO Jonathan Chadwick said "we are seeing strong customer demand for new solutions such as the software-defined data center" and that the prospects for the rest of the year are strong.

In the third quarter, VMware's services revenue was $725 million with license revenue of $564 million. Software maintenance accounts for the bulk of VMware's services sales.

By region, 52.4 percent of VMware's third quarter revenue was international.

Larry Dignan is Editor in Chief of ZDNet and SmartPlanet as well as Editorial Director of ZDNet's sister site TechRepublic.