The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.NEW YORK ( TheStreet) -- The new buzzword of all buzzwords these days is "cloud computing." While not entirely a new concept, there are many companies racing and jockeying to be the first to either define or "re-define" what it means.
The company earned 66 cents per share -- jumping 38% on an annual basis as sales surged 25% to $1.06 billion. These results compare to analysts' expectations of 60 cents per share on revenue of $1.028 billion. What these results tell me is that corporate customers and the enterprise continue to demonstrate their trust and loyalty to VMware's services for their mission-critical solutions -- which includes databases, ERP systems, email as well as collaboration systems. So the question is, in such a highly competitive landscape with such dominant names, what's so special about VMware? What has always stood out for me regarding the cloud was the fact that the company (unlike its rivals) has what is called a hybrid concept -- or a focus on integrating the needs of the customer and allowing them to create and manage applications needed to run their businesses effectively. What also sets it apart from EMC or even Salesfore.com is that the company also provides clients with flexibility and portability to move applications between clouds without rewriting them -- from private to public clouds and back. This is while also offering exceptional performance and security as well as the ability to deliver exceptional quality of service that is scalable with business operations. Because of its success the company has become a target of names such as Oracle and in particular Microsoft, which wants to take a big chunk out of VMware's lead in virtualization -- which is currently at 75 percent of the server market according to a recent survey. The question that investors grapple with is can the company still grow into its current valuation? This has to do with its lofty price of $111 and a price-to-earnings ratio of 66. That said, it remains clear that investors feel comfortable betting heavily that the company can yet continue to drive the shift into the cloud. But will the stock behave commensurate to those expectations?