VMware (VMW) - Get VMware, Inc. Class A Report the cloud-computing major controlled by Dell Technologies (DELL) - Get Dell Technologies Inc Class C Report, reported better-than-expected third-quarter earnings Tuesday and raised its full year guidance.
VMware reported net income of $704 million, or $1.66 per share, up from $602 million, or $1.42 per share a year ago. FactSet's consensus called for earnings of $1.44 per share.
Revenue totaled $2.86 billion, up 8% a year ago and surpassing FactSet's consensus of $2.81 billion.
The combination of subscription and Software as a Service (SaaS) and license revenue came to $1.32 billion, an increase of 10% from a year ago. Subscription and SaaS revenue was $676 million, the company said, an increase of 44% year-over-year, representing 24% of total revenue.
"Subscription and SaaS revenue increased 44% year-over-year in Q3 and surpassed license revenue for the first time,” Zane Rowe, executive vice president and chief financial officer, said in a statement.
Operating cash flow for the third quarter was $992 million, while free cash flow was $908 million.
VMware raised its full-year fiscal 2021 total revenue guidance to $11.7 billion and increased net income per share forecast to between $4.17 and $4.27 with non-GAAP net income per share of $7.03.
FactSet's consensus is calling for full-year revenue of $11.6 billion and earnings of $6.66 per share.
“Q3 was another good quarter for VMware, and we’re pleased with our results,” Pat Gelsinger, CEO, VMware, said. “As customers navigate through these unprecedented times, our focus remains on delivering the digital foundation for an unpredictable world. We continue to shape the future in areas that are top priority for every business–from app development to multi-cloud to security and digital workspaces.”
Shares of the Palo Alto, Calif.-based company were up nearly 1% to $151.82.