VMware Beats on Q4, Will Cut 900 Positions

VMware (NYSE: VMW  ) reported encouraging Q4 and 2012 earnings yesterday, but tempered this by announcing job cuts.

The quarterly tally was $1.3 billion in revenue and a net profit of $206 million ($0.47 per diluted share), which was above analyst expectations. Those figures were roughly 22% and 3% higher, respectively, on a year-over-year basis.

Those percentage figures matched the full-year numbers, with revenue advancing to $4.6 billion and the bottom line coming in at $746 million ($1.72 diluted EPS).

However, the company expects lower revenue growth this year. It anticipates the top line will be $5.23 billion-$5.35 billion for 2013, which is several tens of millions shy of previous analyst expectations.

In an SEC filing, the company announced job cuts that will affect around 900 employees, which would be about 6.8% of the company's total work force. VMware expects to take a charge of $70 million-$80 million for the layoffs and said the exit of certain lines of business and the consolidation of facilities would result in another charge of $20 million-$30 million. The company said it expects the "streamlining" plan that includes the layoffs and consolidation to be done by the end of 2013.

According to The Wall Street Journal, the cuts will come in units that develop the company's slower-growing products and overall the company plans to boost its head count by around 1,000 during the course of this year.


Read/Post Comments (1) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 30, 2013, at 3:28 AM, FlyboyAlaska wrote:

    Interesting analysis. However it would have been more meaningful and useful if it had addressed the near 20% drop in stock price.

Add your comment.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2221756, ~/Articles/ArticleHandler.aspx, 9/29/2016 6:18:17 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,143.45 -195.79 -1.07%
S&P 500 2,151.13 -20.24 -0.93%
NASD 5,269.15 -49.39 -0.93%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/29/2016 4:02 PM
VMW $73.08 Down -0.77 -1.04%
VMware CAPS Rating: ***