Company missed analyst expectations on billings but new partnerships helped to drive growth across the board.
VMware has reported its Q1 2018 financial results with positive revenue gains.
The virtualisation software maker said that its net income rose by 44.1% to $232m in Q1, while revenue grew by 9.3% to $1.74bn, beating analyst expectations of $1.71bn.
Services revenue grew by 10.7% to $1.13bn but billings missed Wall Street estimates of $1.6bn by coming in at $1.35bn.
R&D costs rose by 18.2% and because of this and the lower than expected billings, the company saw its share price drop by around 6%, however, at time of writing the share price has recovered and now sits at $97.40, up 0.25%.
Pat Gelsinger, CEO, VMware said: “We are very pleased with our strong Q1 results. Our strategy is resonating across the regions and driving increased customer interest for our SDDC and cloud portfolio as well as our digital workspace offerings.
“We also drove momentum across our partner ecosystem, featuring announcements with Dell EMC, Google, Microsoft and Oracle providing customers more complete solutions across clouds, applications and devices.”
In addition to the announcements that Gelsinger mentioned, VMware also struck a partnership with Amazon Web Services, which is due to be launched in the coming months. The beta for the service has been oversubscribed and initial feedback is said to be positive.
For the current quarter VMware is forecasting revenue of between $1.84bn – $1.89bn, analysts are expecting closer to $1.81bn.
Full-year revenue forecast has been raised by VMware to $7.61bn, up from $7.57bn.
Zane Rowe, executive vice president and chief financial officer, VMware, said, “Q1 was a great start to the year. We’re pleased with our performance and remain committed to providing value to our customers as they build out their private, public and hybrid cloud strategies.”