Vmware shares plunge as investors baulk

VMWARE Q4 numbers look decent but investors wanted more and suspect the firm may have had its day in the sun. Other proprietry vendors like Microsoft (with Windows Server 08 virtualisation), Oracle (with Oracle VM) and Sun (with Sun xVM) among others are prowling the server virtualisation market and Citrix bought Xen Source, an open sauce product.

Investors expecting better than Q4 revenue of $412 million (full year $1.33 billion) and Q4 income of $76 million (full year $235 million) dumped the stock. Quarterly revenues were up 80 per cent (full year up 88 per cent) and Q4 profit more than doubled (full year ditto).

Vmware is 90 per cent owned by storage bulldozer EMC. EMC put 10 per cent of Vmware shares are on the market in August last year. But initial trading after the latest results saw them drop 25 per cent to around $65. µ