VMware Profit Falls 26%

(RTTNews) - Virtualization software maker VMware Inc. (VMW) said Tuesday after the markets closed that its third quarter profit fell 26% from last year, reflecting the impact of its $1.54 billion acquisition of AirWatch earlier this year.

However, the company's quarterly earnings per share, excluding items, came in above analysts' expectations as did its quarterly revenue.

"Our third-quarter revenue grew 18%, reflecting strong customer adoption of our products and services," said Jonathan Chadwick, VMware's chief financial officer.

VMware shares are currently losing 3.73% in after hours trading after closing the day's regular trading session at $88.19, up 53 cents. The shares trade in a 52-week range of $76.51 to $112.89.

For the third quarter ended September 30, 2014, the Palo Alto, California-based company reported net income of $194 million or $0.45 per share, compared to $261 million or $0.60 per share for the year-ago quarter.

Excluding items, adjusted net income for the quarter was $377 million or $0.87 per share, compared to $363 million or $0.84 per share in the prior year quarter.

On average, 39 analysts polled by Thomson Reuters expected the company to earn $0.83 per share for the third quarter. Analysts' estimates typically exclude special items. VMware, which is majority owned by EMC Corp. (EMC), said revenues for the third quarter rose 18% to $1.52 billion from $1.29 billion in the same quarter last year. Thirty-six analysts had a consensus revenue estimate of $1.50 billion for the third quarter.

EMC Corp. has lately come under pressure from Elliott Management Corp. to change its structure, including a spin-off of VMware.