VMware Results in Line With Estimates as Contracts Are Renewed

VMware Inc., the biggest maker of virtualization software, reported results that were in line with analysts’ estimates after the company announced preliminary results earlier in the month.

Second-quarter profit was 93 cents a share on sales of $1.6 billion excluding costs such as a $75.5 million overbilling settlement with the U.S. government, the company said in a statement Tuesday. Analysts on average had projected profit of 91 cents a share and revenue of $1.59 billion, according to data compiled by Bloomberg.

Clients use VMware’s virtualization software to save money by consolidating applications. Customers have been renewing contracts for the software and adding management tools, said Abhey Lamba, an analyst at Mizuho Securities USA Inc. Still, VMware’s third-quarter forecast may be shy of some analysts’ estimates as license revenues fall short, he said.

Elliott Management Corp. is pressing VMware majority owner EMC Corp. to spin off the faster-growing unit, saying the parent is undervalued and that there’s too much overlap between the companies.

Shares of the Palo Alto, California-based software maker slipped in extended trading. The stock fell 1 percent to $83.19 at the close in New York, leaving it up less than 1 percent this year.

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