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Virtualisation leader grows Q1 revenues to $438m

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VMware has announced financial results for the first quarter of 2008, showing a 69% increase in revenue to $438-million.

GAAP operating income for the first quarter was $48-million, compared to $46-million in the first quarter of 2007, while non-GAAP operating income was $106-million, an increase of 62% over the year-ago quarter.
“Q1 was another quarter of increased demand for VMware virtualisation products and solutions,” says Diane Greene, president and CEO of VMware. “Our strategy to continually deliver superb quality and market-expanding solutions well ahead of the competition is working and we’re advantaging our lead with our well developed multi-tier partner distribution model.
"We are seeing customers progress more rapidly through the virtualization adoption path; many are now moving right into a VMware-based architecture so that they can pool their resources, deliver capacity on demand, and also get an insurance policy for business continuity and disaster recovery.”
First-quarter US revenues grew 65% compared to the year-ago quarter on increased demand from large enterprises standardising on the VMware platform and an increase in the number of smaller transactions delivered through VMware channel partners.
International revenues, which increased 74%, were driven in part by triple-digit business growth across Australia and emerging markets including Brazil, China, India and Russia.
Software license revenue grew 73% compared to the same period last year to $294-million and service revenue, including support, subscription and professional services, increased 62% to $144-million.
During the first quarter VMware announced and shipped new products and technologies in four key areas: desktop virtualisation; data centre virtualisation; management and automation for the data centre; and platform security.
The company announced OEM agreements with four major hardware vendors to pre-install the VMware ESXi hypervisor on their servers. The company announced major enhancements to its channel partner programs to help the more than 13 000 indirect channel partners reselling VMware expand their virtualisation practices and drive new customer adoption.
Specific quarterly highlights include:
* General availability of VMware Virtual Desktop Manager 2, which allows users to securely connect to their virtual desktops in the datacenter and gives IT administrators an easy and cost-effective way to manage virtual desktops;
* General availability of VMware Lifecycle Manager, which enables companies to implement a consistent and automated process for requesting, approving, deploying, updating, and retiring virtual machines;
and
*  The announcement of VMware VMsafe, a new security initiative endorsed by more than 20 security vendors that protects applications running in virtual machines in ways previously not possible in physical environments.