VMware sees 37% stock jump in Q4, invests in virtualization

VMware saw a 37% jump in its shares for its fourth quarter, sources reported. The hike has been credited to the company’s increased spending on virtualization software’s sources added.

Revenue for the three months to Dec. 31 was US$835.6 million, up from $608.2 million in the fourth quarter of 2009, well ahead of analyst’s expectations.

VMware’s net income was $120 million or $0.28 per share, an up from $56 million and $0.14 per share respectively, in the same quarter the previous year, sources reported.

According to sources, half of the firm’s business is accountable to License sales and services revenue whose sales increased by 30 percent and 36 % respectively.

Sources added, that VMware clearly benefitted from the momentum of Virtualization as the central technology; an area where they had upped their investment in the fourth quarter.
The company has high expectations for its revenues for the first quarter, to be between $800 million and $820 million, which shall result into a jump of 26 % to 29 % compared to last year, sources reported.

The company has pinned high hopes for its reveunes, and it expects to achieve more than the current estimate of $786 million.