VMW - Earnings call transcript Q2 2019

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Operator

Good day, ladies and gentlemen and welcome to today’s VMware Second Quarter Fiscal Year 2019 Earnings Call. I would like to remind everyone that this call is being recorded. And at this time, I would like to turn the conference over to Paul Ziots, Vice President, Investor Relations.

Paul Ziots

Thank you. Good afternoon, everyone and welcome to VMware’s second quarter fiscal 2019 earnings conference call.

have Vice Chief Officer. President we Zane Officer call Executive Rowe, and the Pat Executive Gelsinger, and On Chief Financial

their will we prepared Following take questions. remarks,

forward-looking On is the press can is statements update call also to Actual call remarks the viewed webcast. files factors, VMware this XX-Ks, make do and such of this at of as Our in that will issued the risks are accompany intend simultaneously our conclusion after X-Ks be obligation statements. which webcast can was forward-looking risk market and where downloaded results release being a with from not and currently subject we the uncertainties. including of various any materially in and webcast posted and to those Slides SEC. this conjunction on described website live ir.vmware.com. close may to We today, the differ be XX-Qs with no result assume

call, today’s be considered certain are as of from should performance during GAAP financial in non-GAAP VMware’s or used addition as measures. addition, to which for non-GAAP These we a in not measures In isolation measures. measures financial discuss substitute will

of Our employee Pivotal employer Software effect our non-GAAP including stock-based on gain divestiture non-GAAP items, intangible the transactions, on measures and acquired and compensation, rate acquisition, payroll GAAP exclude of stock results amortization on adjustments. the assets, tax other tax related

the available link. Relations including The for non-GAAP be Relations days regarding and disclosures measures, You comparable this Investor these additional press website our with company XX of next call webcast in website. can release under on GAAP find reconciliations Investor on the our replay will measures the

close Thursday, period third begins XX, quiet at XXXX XXXX. Our of fiscal business the October quarter

XXXX to In in XXXX. meaningful VMware adopted X prior presented results statements the included of XXX. months adjusted financial results ASC for comparisons sheet end flows to discussed XXX. of Accordingly, are year-over-year balance forward-looking the the With XXXX X, this basis a discussed of the ASC XXXX fiscal quarter and guidance XXXX for have periods, addition, on cash of including Pat. to February on order ended ASC income and fiscal turn comparisons second XXX retrospective to adjusted press under corresponding XXXX our ASC our comparisons release quarter will for it has I All this been for fiscal In effective X as second and full prepared and on provide August XXX. X, adjusted call and VMware of the over the ASC that, call, periods as fiscal for XXX

Pat Gelsinger

all for to the EMEA. in Paul. non-GAAP Three we earnings and per QX geographies, year-over-year. was and pleased which our central quarter in factors with to diverse remain be revenue across increased XX% In another product share strength quarter. our primary you, portfolio driven Thank total QX, by VMware results, strength ongoing broad-based XX% strong are particularly our increased continue three and

the lastly, our to well market to consistent journeys. as their We and enterprise positioned digital with VMware. such are VMware. response for company strategy to other as strong and no secondly, go-to-market positive Customers software continuing Firstly, turning and accelerate the them innovation, execution, to as is enterprise environment VMware increasingly company positive well-positioned believe partner

that a Our digital innovation powerful the and for business interoperable and business networking cloud form drive success. apps foundation mobility, delivering security solutions

NTT affinity decade-long new experienced expansion Cloud Partner of as Our offerings. Program Germany. for The momentum across see service resonating bringing robust multi-cloud fourth our among enterprise SDDC example we across major a quarter. recently customers with are our momentum A strategy good to Cloud seeing with EMEA cloud customers. partnership the this with including growth momentum June, its customer larger announced VMware and VMware Cloud continue America VMware the offering full and stack. update, In our is received consisting of traction of and AWS to cloud this is and VMware the AWS North

introduced cloud United service also increased the hybrid applications traction of on on across we In of and the Cloud will in AWS using now sector With VMware GovCloud, run VMware public seeing to a we the AWS States VMware and partner GovCloud. ecosystem. interest addition, AWS forthcoming enable customers deploy service, software agencies that are hundreds

XXX VMware partner over Cloud seen AWS the have and competency We join program. partners

In the They a transacting cloud to a with their on-prem customer those addition workloads utilizing those to directly and cloud Site refresh of food A datacenter over Cloud example are AWS partners now of VMware Manager. their protect strategy, Recovery great distributor. are with global XX is deployment business with and customers. extend

networking this portfolio adopted now NSX. experienced Fortune license Our bookings quarter, of past XX companies healthy growth having XXX with the

customers seeing are We network that embrace we cloud QX. the strategy unveiled in virtual

NSX will VMware by a network cloud T-Systems leverage in architecture example, we For virtual announced datacenter. July, enabled

are its AT&T we While service with as rapidly many segments for particular, expanding VeloCloud, customer collaboration in the retail strength and providers in such financial and seeing is enterprise in services.

early We across NSX. all are frameworks container for seeing adoption significant

to which of service virtualization production includes proven company’s We providers. also recent across One NSX integrate the communication network the Edition continue example platform the generation is new portfolio. vCloud functions X.X, VMware technology NFV-OpenStack the VMware for next

cloud see network CSPs IT to their and out global build telcos continue We platforms. and

Service customers. As analysis performance transformation, for Dell and virtual help an EMEA recently root their and IT software intent example, telco network To team to and a major Assurance acquire workloads. VMware recently network CSPs health, announced customer technology cloud suite, cause monitoring their telco functions customer the won the with we of spanning for building EMC another and

the of of major Dell point experience was implementing Dell and and to store another team largest we a server quarter completed refresh. a deals with the portfolio. are strong retail synergies, retailer, great vSAN, experienced It to and one and X,XXX Turning forward a win where we another VxRail continued we the ever VMware tech across proof across

with QX our validated Systems again Converged lead XXXX HCI position an extended was competitor. the June ‘XX leadership nearest number the share Quarterly Worldwide market which IDC over HCI Software, one Tracker, VMware in placed for by Our

to also the is The quarter with and identity between strong mobile management Okta offerings and functionality. score integrated business which vSphere we partnership And our Workspace strong in ONE approach desktop, our QX and Unified business integration published Hybrid with market to customers securely at we view, more of look validation in and continues a In In recognition, for next experienced another unveiling in ecosystem We XXXX. offering Wave: Endpoint comprised quarter more expansion of our criteria customer industry The to Forrester were Workspace pleased user major the see VMware Okta compute Tools the easily VMware and cloud management highest Gartner and industry Identity Magic received achieve monitoring, move positioned Management computing Management as was Quadrant May, week. possible inaugural vision, XXXX. traction to another the cloud. the VMware, Cloud end to VMworld and Cloud in product ONE, and forward in cloud partner for our highlighted the enabling leader July saw

a customers’ capital their cash. stock Dell’s announcement on and Technologies of portfolio listed the performance our stock strong as our publicly In Class plans digital with maintaining the with pleased and VMware’s yearly. This strategic VMworld and a broad-based our with where growth advancing new foundation. with Class resonates digital through offer and closing, following welcoming common pleased We proposed we July simplify plans showcase or across to week, Dell’s increase will class of our we were We to our partners we independence. delivering review. VMware’s exchange peers with conclusion continue common of regarding VMware completion for Dell to our our look forward Technologies Finally, stock our transformations tracking customers. action to to structure Dell of C committed customers, B be strategy Dell industry strategy while remain X alignment next

We I AWS innovations turn will to and the portfolio in including in talk updates partnership to QX. performance over now unveiled business the ecosystem, be offerings it general about and and across unveil are our excited keynote. session more news to technology to Zane new

Zane Rowe

us all Pat for Thank you, and you joining of thanks to today.

results quarter. and double-digit license with in revenue and comprised This in results grow all and that the a Total portfolio. with year-over-year strategy with year-over-year services were continued by category grew total a These are year-over-year. growth healthy strong grew major across product product categories. XX% execution license customers across rate XX% QX to subscription quarter a and our in broad at QX. in XX% We bookings the revenue resonates driven pleased of resulting business cloud revenue SaaS Hybrid

share QX, X micro-segmentation, broad-based margin functions which operating of quarter Cash In plus level of portfolio, diluted of applications. We unearned performance strong short-term as grew We of year-over-year. networking vSAN year-over-year vSAN vSAN enterprise up components change well more $XX.X Provider top strong as including cases, XX% at our year-over-year our deals on network including investments cloud-native adoption SD-WAN in revenue they use total once license was sequential QX than and branch XX% of in VCPP in services using of end VeloCloud again variety growth revenue a revenue multi-cloud up applications, included Program XX% non-GAAP $X EPS have was automation, networking, plus the Unearned year-over-year. totaled NSX customers or customer and its as revenue run Our had represented up high VxRail the bookings, over XX% of and grew we saw critical in XXX unearned across software license products include VMware QX, count sequential and total XX.X%. platform. million business QX. Cloud XX year-over-year a well was growth to revenue, with vSAN vSAN The billion. XX% change the standalone satisfaction XX% $X.XX, of as XX% billion. revenue year-over-year. software the now license in the virtualization. network Non-GAAP continued shares. expanded

has large has of purchased on vSAN. applications, data multiple vSAN For transactions to running through XX example, financial petabytes which a banking production institution, host now over

driver bookings. our increased up license of year-over-year, a again strongest adoption license where the Compute management of customers’ ONE which XX% high-teens. vSAN over the and is momentum seeing the our for milestone significant which combination bookings bookings also year-over-year bookings and in and technology hyperconverged increased VxRail, Workspace majority total the is confidence highlights SaaS we with low-teens in exceeding ecosystem annual was We appliance QX. grew compute the acceleration gaining license as management of enhanced in on-premises driven run-rate growth were in is ONE with as running single-digits billion the bookings as to This platform largest quarter vSAN, management largest Core bookings with by our our growth QX for offerings growth in product This Management deployments. of sold performances in Dell’s high-teens the our license and up adoption from growing grew Workspace attach one SDDC $X customers compute some SaaS. in continued with mid-teens management of EUC both deals bookings our bookings expectations. product compute the cloud in areas cumulative and are of in and mid of year-over-year. QX. Total saw once for surpassed the the in and well this

non-GAAP billion, per flow to total for margin for of and $X.XXX ‘XX to to result full free to per now non-GAAP shares. $X.XXX operating expect $X.XXX revenue flow. fiscal earnings fiscal is $X.XXX operating revenue, up and billion Cash year XX.X% QX cash cash flow increasing increase increasing We million of $X.XX are expected fiscal billion, revenue, our on of diluted operations increase Non-GAAP XXX share expected ‘XX year-over-year. to XX.X% billion. to operations share a free performance, increase license non-GAAP margin, with from a expected is guidance to ‘XX an flow earnings to we license revenue billion count increase from XX.X% from is $X.XXX year-over-year be to and cash share, be for total As

million this We up Dell in in with the $XXX last expect synergies synergies year, we $XXX from million continue to achieved year. fiscal

backlog an orders exited year-over-year. of million, unfulfilled license $XXX with to For backlog year-over-year million QX, license and total $XXX We quarter of portion compared end an is $X.XXX billion, of revenue of we be increase XX.X% at License expect license revenue $XXX QX the XX.X% the to end. at million with be QX. increase of

X, count For of special on we billion VMware be operating QX, On announced to share one-time earnings non-GAAP to non-GAAP XX% XXX expect per shares. margin an and July conditional diluted million be a share dividend. $X.XX $XX

return allocation our previous special capital to policy. Following to expect the dividend, we

our organically report stockholders a the growth drive that summary, results pleased resonates strategy In we strong business, value successful reflection our quarter of will another and share with We QX are VMware. through for to continuing strategy M&A in repurchases. and shareholder via capital return investing to are customers. the

business We next the seeing progress across future. sharing continue that, to opportunities driving will VMworld week the in the of rest and forward portfolio call the to and back Paul. you With our throughout at look of I growth invest I today in to with the year. the turn you many

Paul Ziots

Thanks, Zane.

not let’s one be as begin Operator, ask you Dell's Class the consisting many Q&A, started. we Before can note as to on tracking Please question of so to B will yourselves get people possible. one proposed of exchange commenting to I get stock. will limit part, we we

Operator

first Stanley. with Keith [Operator And we Instructions] Morgan will Weiss hear from

Keith Weiss

you like when the a question. the is Very help up good trajectory, we quarter that so in trends kind like question nice you looks a total that quarter. see license bit total have into and this guys Anything well, divergence I Zane between why that that little sustained maybe for the the It this more seen, you can look the license demand saw XX% off in that and been guys total did caused growth, is One Thank you seeing more billings this in well billings. billings stayed billings the had pretty while for but explain at sustained growth guys quarter. taking and license Excellent. falloff more have billings that divergence billings like fell a particular of the high? you really of

Zane Rowe

Hey, the for Keith, it’s Zane. Yes, question. thanks

total out, first total on was to had site the quarter I you on the first quarter as strong year-over-year license a divergence the booking both the frankly and you is point you nothing and would actually and tell read we at it since saw compare. great into as quite on revenue there look quarter well. As license the a you

as the strengths attributed prepared earlier VCPP. none I is One license that in remarks my to goes of and know that And you S&S. see highlighted of in towards that we strength the probably was that

continue our that out that the area we see and year. So very pleased will are strong. with expect that we to really I the strength are point in of rates through all

strong. S&S are Our rates

rest are rates tell as renewal can improvement guidance, for strong. total year. we Our both the by and And license the you the in the feel good about of revenue

Keith Weiss

Thank Excellent. guys. you

Paul Ziots

Keith. you, Thank

Next question please.

Operator

Moving on Bank Kash Lynch, America/Merrill from of have Rangan. we

Kash Rangan

going products for service Amazon. are the out? help very so as talk launched as Congrats for do I and business then years respect as on to NSX, that customers new the anticipation albeit through terms EUC, quarter. Any this something that delivered recurring such of changes a revenue, few how some model looking implications on kind the was with changes service think predictable that up the you capacity looking is see capacity, are CSX take to you of datacenter is Pat, more thank to guys. earlier cloud-based of much. that vSAN your you you first Thank subscription whatnot Hi, of you what your AWS in VMware. to you And Zane, curious core up the of much to put when as with

Pat Gelsinger

Kash. Thanks,

then and to on for suggested AWS. And start a little see As Overall, me we momentum with great bit a uptake just VMC great framing as maybe apart very you Zane just the VMware Kash. continued said are we happy by quarter. cloud taking and the let

us capacity would DRS, and node features a part cloud the it which updated I is management VMware of say the feature automation. elastic this pace and and innovations on single gives rolled new foundation compute delivery scalable are and spectacular really And support. functions and new we like full out was storage we cloud cycle First release quarter seamless to that’s networking, the quarterly being is of function this

major a next takes to for the we new that just QX it am if really paid big enterprise customer are have see pick customers week partnerships service, they before on comfortable. as I going time to from Andy, saw And indicated we of the we AWS thrilled there talking up. to now are that ended at some VMworld. customers be announcing really next the platform. to And momentum of particularly start we about version Jesse uptake have as We hundreds

getting of are but part just are We logos, consumption we larger customer as And on deals platform. increasingly driving not new focused of that. now seeing that the

We have indicated be that XX competency partners, the the of see they partner now to to transact over driving platform. are – momentum that as we to business those XXX of be have And are excited in area. we very as we seeing a showcase started are great momentum. also on the And this I already expect to a

have customer and sub indicated There the AWS separately, full get data is is full it before the no defined it on they software they of that is we VMware service And when they the composition VMware of where where buy we storage stack. Cloud. believe a or part As unique attribute this Cloud buys offering. whole center get compute

customers cloud the have in some unique of capabilities maybe that bit affect to of service. will use want VMware. to the really where really that aspects newer cases a financial the more those of as drive comment of VMC the use more examples are It on-premise well. hybrid some becoming see those really to fastest way overall likely starting And of many capability areas marketplace. in and that to you the product We hybrid are and cloud also believe some we the of customers start that is be they them is Zane,

Zane Rowe

you enter growth Sure, subscription more not expect those. a have but yes. SaaS Kash we out highlighted tremendous of we we point would with only the and us model VCPP like last service into as little the growing quarters well. with VMC with for got as it that I is as sort recurring predictability as we number along I and would more which seeing rates highlighted theme more becomes over success to utility the with of XX% the a model of are products,

So we products pleased but more that are type that’s both as think which growing category. be are it predictable, We very really we the in well pleased will with model as well. as perpetual serving us the again SaaS that well the with also models is

Pat Gelsinger

EUC as Another is example all our well, service those is the which accelerate. now to of ONE of and as majority is Workspace continue of of that clearly clearly business EUC so

Zane Rowe

right. That’s

Paul Ziots

Thank you, Kash.

Next question please.

Operator

will DiFucci have we on with Jefferies. Moving John

John DiFucci

Thank you.

be better because act whatever had and with going much a was been falloff quarters to So a couple The a and of Pat successful now conclusion year have the we last because last you there just others years, curious stick do I what’s as of I looking to know new two that of actually seeing I think is one compute of lot including fundamentals some have a – would some people now infrastructure, just going they billings going and critical being a it’s it’s license numbers just become and than Zane to really act that little and that lot that VMware is comfortable is I proliferation to massively even mission happen what’s these of mature, especially a going happening things, a infrastructure lot compute what’s are stuff? tools are workloads under coming too of four and the workloads them there, a connect virtualizing question. of the more virtualization there has so more are you and there, you get beyond of the the this is would a technology lot going lot benefit fundamentals, are but think ago I you have compute lot because am am them it a of that then one enterprises not update – think a ton like really with thought management depending tools, or ago is both upon management Paul have there falloff over here, these more is bit things have it of the just has of to on-board when several to is happen dramatically was these are or can first for surprising – is it a about you people part virtualized of or I more okay long the paid it workloads two, there as can three, do to more and

Pat Gelsinger

Yes.

I becoming point more some positioned on-premise. couple answer. model. to. customers One, are think right would cloud, of really bringing right, see we VMC there us confident that. beginning strategic the a uniquely the benefit see together things VMware to is model that this strength demonstrated to our AWS in of of the and both on from of as the the is cloud hybrid that on-premise they in VMware And John early Clearly as there, this to in have are computing we the customers commitment hybrid clearly workloads And in is

proof momentum that we maybe have strongest see have in quarter our plus which of to of we that growth We business. points one continued the another had in XX% the is VCPP yet business that

we are XXXX customers are testament and IBM, customers have but those vSphere. and as it Zane growing in it’s bulk VCPP clearly with to plus partners. The we as IBM so VCPP that well, now size Alright, commented, a already have not on continue to X,XXX IBM of great we just the momentum consumption that. Now is

VMware back started of many from to a that We to see have the public their balanced hybrid the more companies in of are as growing that repatriate will are of recent strategically their business they us in refresh renewal we of analysts the rates as see workloads well their ELA customers cloud the All the and of Overall, forecasted workloads. that of by say those view I business. expect taken renewals side consuming future cloud well together confidence on-premise as and some to cloud in will that this the we increasingly compute the boy, and portfolio some just strength computer just going the also us would IDC I think indicate moving see seen rest this will every world the selling emphasize core as we opportunity core in of that to idea a have time do be in that’s platform for as well. I

Zane Rowe

our John outlook. over period. add on compute pleasantly the we term have about in low of in longer the compute wrong longer just just been we say will think we would how growth sort in the think rate. up We as we conservative are short-term look be I single-digits the Hi I But still will compute total

outlook longer very the our are for this with performance term we So pleased haven’t we that just changed category.

John DiFucci

Thank you, guys.

Paul Ziots

Thanks.

question Next please.

Operator

come question Mark JPMorgan. Next from with Murphy will

Mark Murphy

I Thank were they growing you about visibility any out you to additional as instance related of show multi-year for several of just annually years curious on but I really cash some into relevant growing level and are but and that, frame-up helping cloud then compute those maybe free going can several to that trending going elements and maybe for the think recent closer congrats. years commentary XXX do next think multi-part guidance? to or not I Dell ask the in the just your ahead you for projections to XXX am question, just I you XX% and seeing anything if flow and I prior think your my you to Pat are back very questions add filing whether and future and ASC XX% Zane just will what were of in a am revenue and included much provide ASC March XX%

Zane Rowe

not don’t And a for than some the our of were current look the variety call. into is under I the point end on are of we with we typically had projections that that this S-X ahead further year filing Mark, specific out towards go X will go or Zane. year the Sure assumptions specific practice guidance. obviously tail that wouldn’t projections this we purpose changing a year

how strategically. think touch it’s how any we more and business the forecast. we adding that are But with thinking to question, good a about I So color I the wouldn’t look on obviously comfortable we at business are particular

Pat Gelsinger

trends and believe are think portfolio business that These we long-term where Yes. the I believe a in are know Customers statements execution my we I Mark the are product future. and that those is quarter, rates, And strategic the that in those say strategy, we that long-term the very cycle just is into for VMware as business with but quarter are market we our not have. and customers performance, the growth technology are would strong resonating you our not are well good said in this the for ability of a formal to cycle. we strong we invest comments just good the statements, this for in

Zane Rowe

Mark. you, Thank

Pat Gelsinger

Next please. question

Operator

Next Matt have from Capital Hedberg. Markets, we RBC

Matt Hedberg

use I segmentation cases success some you that there well. little any continued color prevalent in non-micro is and of of how them would congrats about offer hear and guys. who NSX as number lot continued adopting your probably your color other was them. but think a in a It Hi, will remarks, cases, my I about be these customers, use of assume prepared we a more to additional larger been great of are the really historically on highlighted Zane micro-segmentation, to us give helpful? lot talk, with of I but can that some you security a hear has

Pat Gelsinger

with broader, that this question, much micro-segmentation, view excited again just and software capabilities NSX have we called is Fortune are the center, standard of the idea Yes, NSX virtual it’s are product, it networking. We we have become these that and the quickly much XX% as now expanded NSX. we for really XX Matt. thanks use now portfolio NSX the hybrid about customers SD-WAN have NSX generally networking cases but And embraced but XXX defined we for data data network, cloud the multi-cloud telco has benefiting from we of and/or the quarter have. are growth containers, there has on in center seeing for NSX overall enterprise just gotten end really where VeloCloud, higher this a have been not

for right, of in a use particular base, it’s and for now customer year, customers both with seeing native our migration, strength cases, now cloud container customers profound, to while first NSX the hot moving are NSX. count multi-cloud X,XXX these all was see of are smaller the branch these in total cloud as from rapidly that micro-segmentation, adopting we and for becoming branches, cases SD-WAN idea SD-WAN. it where suggest, exceeding of stores, use the at We more expectations enterprise And of for like much configurations. remote a the might half you be

aspect particularly as for from the seeing that both enterprise an We partners VeloCloud like service strong leaning the and NSX provider very of family. are into well channel are AT&T aggressively

really I XXX this for clearly network, very being position seen captured software of as NSX Fortune now industry, of defined and the cloud with strategy the solid broadening the our of XX networking. virtual as has very, overall, interest customers and So is standard the said it this

Matt Hedberg

guys. Thanks

Paul Ziots

Matt. you, Thank

please. Next question

Operator

Gregg we Next from have Cowen Moskowitz. & Company

Unidentified Analyst

[indiscernible] so seeing far? hearing Matt are for is and What on Gregg. PKS Hi, around this you

Pat Gelsinger

there networking, tremendous they how part this where embracing the best acceleration such and of we a that of worlds, clearly machines, This both these majority standard very seeing vast many security, element an count interest bring patch Kubernetes that. right containers a way? We containers really are as thank grade is is trends. of development challenges do those virtual new VMware of that Pat. topic enterprise know, will giving deployments, of the PKS making and development the of had machine configuration, you do that sales And run to take I two our the best idea the and believe this how really together. containers idea, result we And are that so quarter. goals are overall customers, app virtual things our enterprise is we optimization, is the And I idea plus you. that And really for the hot do to in as for powerful exceeded a say, update, and for We it in the way far very is management, automation, is VMs modern Yes, by it, is customer did infrastructure containers of as advantage of in of engagement. do is about a strategy the

early the accelerating. seeing counts logo are we So

mark SDDC an Kubernetes customer and for to customers So is right container NSX technology very we even is Kubernetes and are quite with excited today. is combination quarters have about to grade clearly very offering Google goals our and of ahead that it’s And rights couple exciting the PKS, customers VMware the that of enterprise in exciting hitting particular enables a that offerings of Pivotal’s though already and old only clearly, see.

Unidentified Analyst

Thank you much. very

Pat Gelsinger

Thank you, Gregg.

Paul Ziots

Thank you, Matt.

please. question Next

Operator

from William Next question will Blair. Ader Jason come with

Jason Ader

there? be VMC will you evidence ramp that When show your we metrics of thank you. think AWS to the business at what material will looking on and should Yes, be

Pat Gelsinger

Yes. And at end really I momentum we of overall the the picking as up saw the quarter. indicated

customer and really the of for some larger larger on about we powerful food in consumption area. really another to How center in extend examples this then with test say on workloads, as my some do then unique and as and I supply capability, this we on on this all cloud of distribution this? Brink’s platform data How capacity a start way? have this? centers I exercise the customer the How to platform my warehouse in had in I done get use, how there customers putting we right, focused it bringing this and workloads to turn MIT, that out cycle POC robustness this data moving come talked feature have hybrid global a reach, filling will have early DR I capability will my goes saying, replace into we do dev focus indicated, done major and do with the on way? to, As the really compute quarter, testing customer do right, near-term and are I customer, customers We really they of product the we will count

are advantage we early start seeing customers So to of take those it.

think For next do the VMworld we platform, really week. the expect to that say will to rollouts we and Right, year global that’s of about capability that, at year. we broad this lot use not ramp next have the a more

Jason Ader

sheet when balance or see that billings we metrics? off of terms is the in an in backlog And

Zane Rowe

our products from we billings product, into a the year. it then ramp mean, should but and materialize hear Ultimately, and in to obviously, be later opportunity so that revenue. bookings as the will on us we this expect SaaS are you about more I excited would it’s used, and

Paul Ziots

lot Thank It’s and A are out there a Jason. people simultaneously. summertime. lot of of on are today you, calls

queue question. one So, be we this more last and have will question in the

Operator

from question Final James. Raymond be Alright. Turits with Michael will

Michael Turits

me Hey, guys. in. Thank you very getting much for

we here, specifically And use say but in applications built of that from or sorry would type the deployment of Are being we types and I to are lift-and-shift VMCA boring be of scratch are Amazon? want traditional cases. architectural what modern in stay speak seeing these [workloads] more mostly of applications about to

Pat Gelsinger

where shift that’s this what have the will exactly to these button the part, will a and are existing to their and this, AWS ability in customers strategy. X. absolutely VMware exactly their data say rethink existing on-premise They we start of the that to sort seamlessly Phase For that X easy with expected advantage start result take and unique Cloud workloads. of Phase VMware to start the workloads cloud. repatriate of see view that’s in cloud capability on of would others of we what’s be. to most this expected we this will And They as is people center is

the to ability Customers are selling to and to and the hybrid is how of excited we becomes installed customers the hybrid rethink, to to can Never the getting that cloud us they have And existing private cases before this it. way VMware people we again. as back base a much, service a emphasize starting we seamless in Phase as point, that VMware a of few We're clearly capability being clearly nature than will and people to be nobody cloud will also next in able cloud, VMworld, would from to occur, to the think the going Cloud VMware and next start that cloud. emphasize but world, way. examples we value be this as of capacity. do. fundamental proving about largely into from their computing X more take hybrid X, lift shift believe Phase beyond, to are week’s go say but much expect showing strategic We comprehensive of see we how a they I deploy something that but this capability cloud much will will had what really advantage take the but public strategic, early And that. that also the bigger use long-term at it’s starts both

Paul Ziots

Michael. you, Thank

Before we conclude, Pat final remarks. has

Pat Gelsinger

very for we said strong proud am team. quarter of as Thank another VMware, QX, I our And you.

exciting forward broad-based seeing indicated technology strength – in seeing we look across our announcements our questions, We to portfolio. continue as you in to And diverse product the see have we forward are look innovations again Thank much. next very to will I going QX our we on where that VMworld you update you to at unveil our week and progress. call, we

Operator

us. does Thanks for Ladies today. conclude and conference for joining gentlemen, our that

now may You disconnect.

Vmware (VMW) 23 Aug 182019 Q2 Earnings call transcript