Middling financial reports from the likes of Riverbed Technology (UNKNOWN:RVBD.DL) and F5 Networks (NASDAQ:FFIV) bode poorly for infrastructure stocks, Fool contributor Tim Beyers says in the following video.
With both stocks, product revenue growth lagged overall revenue growth. The message? Clients aren't as interested in fast hardware as they used to be. Instead, Tim says, they're buying subscriptions to the major cloud-computing environments and letting those suppliers buy, deploy, and manage the necessary equipment. Think of NetSuite, a supplier of cloud-base financial management software which reported 34% revenue growth in the third quarter.
Do you agree? Are you buying or selling infrastructure stocks right now? Please watch the video to get Tim's full take and then leave a comment to let us know where you stand.