Software Company VMware Forecast Profits Above Expectations

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VMware Inc on Tuesday forecast fiscal fourth quarter adjusted profits above expectations and the global demand for cloud computing pushed up sales.

VMware said that it expects fourth quarter adjusted profits of $1.96 per share, above analyst expectations of $1.89 per share. The company predicted fourth-quarter revenue of $3.51 billion, in line with analyst expectations of $3.55 billion, according to IBES data from Refinitiv.

VMware spun out of Dell Technologies Inc earlier this year. The software company provides tools that help companies use their own data centers more efficiently and move their computing work back and forth between their own data centers and those of cloud computing companies like Amazon Web Services.

Chief Executive Raghu Raghuram told Reuters in an interview that the company believes it will see revenue growth from all regions of the world over the course of the next fiscal year.

“IT spending continues stabilize going into next year,” Raghuram said. “Our view is that customers will continue to accelerate their application modernization.”

For the fiscal third quarter ended Oct. 29, VMware said sales and adjusted profits were $3.19 billion and $1.72 per share, both above analyst estimates $3.12 billion and $1.54 per share, according to Refinitiv data.

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