Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of virtualization specialist VMware (VMW) have skyrocketed today by as much as 18% after the company reported earnings last night.
So what: Revenue in the second quarter totaled $1.24 billion, which translated into adjusted earnings per share of $0.79. Both figures topped the market's expectations of $1.23 billion in sales and $0.77 per share in adjusted profit. Investors were impressed with VMware's guidance.
Now what: Third-quarter sales are expected to be in the range of $1.27 billion to $1.3 billion, and license revenues should be $535 million to $555 million. Full-year revenue should be $5.12 billion to $5.26 billion. That outlook helped dispel fears that VMware's business was maturing and growth was slowing, as pessimism had been growing recently. Nomura Securities and Raymond James both upgraded VMware to "buy."
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