VMware VMW recently unveiled two new solutions — vSphere+ and vSAN+ — to help organizations utilize the benefits of cloud infrastructure on their existing on-premises infrastructure.
The two new solutions will provide centralized cloud-based infrastructure management, integrated Kubernetes, access to new hybrid cloud services, and a flexible subscription model without disrupting organizations’ existing workloads or hosts.
vSphere+ and vSAN+ will deliver critical hybrid cloud services like disaster recovery and ransomware protection, which are often unavailable in on-premises infrastructure. Loss and contamination of data generally cost the organization huge capital.
The company has launched new solutions to address the rising demand for on-premise infrastructure with cloud services. The new solutions are an integral part of the VMWare Cloud strategy to deliver consistent infrastructure that covers almost every workload and addresses varied users.
VMware Cloud Services Driving Price Performance
VMware shares have been benefiting from the increasing proliferation of services in the hybrid cloud. The company has been consistently undertaking initiatives to diversify its product portfolio to include most aspects of the global IT infrastructure.
As such, VMware’s launch of new solutions like vSphere+ that address the growing demand for varied services in the cloud industry is expected to drive revenues in the long term.
In order to cover most aspects of the IT infrastructure, VMware has been strategically building partnerships with companies, including Amazon’s AMZN AWS and Dell Technologies DELL, to provide various services.
VMware and AWS have expanded their partnership, which now enables the latter to resell VMware Cloud on its platform. VMware Cloud on AWS is now available in more than 17 regions globally.
Dell has been promoting VMware’s Carbon Black Cloud solutions, along with Dell Trusted Devices and Secureworks, as the preferred endpoint security solution to its commercial customers.
The partnership with Dell is driving VMware’s storage and availability business in the SDDC segment.
Broadcom AVGO announced that the company would acquire all of the outstanding shares of VMware in a cash-and-stock transaction. Through this deal, Broadcom aims to benefit by strengthening its presence in the corporate software market as demand for cloud computing increases and, in turn, drive the top line.
However, Broadcom is facing a lengthy antitrust investigation in Brussels over regulatory concerns that the deal will hurt competition across the global technology sector.
This has resulted in some volatility around VMware’s stock, which initially benefited from the news of the acquisition.
Still, VMware’s shares have returned 0.3% against the Zacks Computer - Software industry’s decline of 23.9%. The tech industry overall is in the doldrums due to macro-economic tensions.
The uptick in VMware’s share prices is due to the company’s expanding partnerships, which are helping it address new customers and growing demand for cloud computing services.
The growing macroeconomic turmoil is leading to a bearish sentiment among investors regarding the tech industry. Along with this, the recent antitrust investigation can impact the stock prices of VMWare negatively in the short run. While this might not be the best time to buy the share, existing stockholders should retain the scrip for a longer period to experience a positive ROI.
VMware currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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