VMware profit misses expectations, shares down by 26 percent

By Margarita Snegireva. VMware Inc reported its quarterly profit that fell short of Wall Street expectations and forecast a slowdown in sales growth, sending its shares down more than 26 percent.

Photo: VMware profit misses expectations, shares down by 26 percent

Analysts saw the report as a sign that the company will lose business to competitors crowding into VMware's key market for virtualization software to manage large computer networks.

VMware, Inc., a publicly-listed company, develops proprietary virtualization software products for x86-compatible computers, including both commercially-available and freeware versions. The company has its headquarters in Palo Alto, California, United States, with R&D offices located in Palo Alto; in San Francisco, California; in Cambridge, Massachusetts; and in Bangalore and Pune, India. VMware's desktop software runs atop Microsoft Windows, Linux, and Mac OS X. VMware's enterprise-level software, VMware ESX Server, runs directly on server hardware without requiring an additional underlying operating system.

The name "VMware" and its branding play on the acronym "VM," meaning "virtual machine".

VMware was founded by Diane Greene, Mendel Rosenblum, Scott Devine, Edward Wang, and Edouard Bugnion in 1998. Greene had earned a Master's Degree in Naval Architecture from MIT in 1978, and in 1988 she earned a second Master's Degree in Computer Science from the University of California at Berkeley. Rosenblum and Greene first met while at Stanford.

On 2007-08-14, EMC Corporation released 10% of the company's shares in VMware in an initial public offering on the New York Stock Exchange. The stock debuted at 29 USD per share, and closed the day at 51 USD.