VMWare Inc. shares inched higher Tuesday after the software maker said third-quarter net income more than doubled on strong demand for its technology in Asia.
VMware helps businesses save money on power and equipment by providing "virtualization" software that allows one computer to function as multiple machines.
The company said Monday that it earned $177.5 million, or 41 cents per share, up from $84.6 million, or 20 cents per share, in the same period a year earlier. Adjusted earnings were 53 cents per share in the latest quarter. This measure excludes stock options expenses, payroll tax on employee stock transactions and other items.
Revenue rose 32 percent to $941.9 million from $714.2 million.
Analysts, on average, expected adjusted earnings of 50 cents per share on revenue of $929.8 million.
"VMware's third quarter results were driven by growth across all products," said Mark Peek, chief financial officer, in a statement. "Demand was especially strong in the Asia Pacific markets and we also experienced the seasonal impact of sales to the U.S. federal government."
For the fourth quarter, the company expects revenue of $1.03 billion to $1.06 billion, up 23 percent to 27 percent from a year earlier. Analysts predict revenue of $1.03 billion.
For the first quarter of 2012, VMware expects revenue to decline sequentially and be in the range of $1 billion to $1.03 billion. Analysts expect nearly $1.03 billion in revenue for the period.
Nomura Equity Research analyst Rick Sherlund said that with VMware's guidance for the next two quarters "practically" matching Wall Street's expectations, he does "not believe this will be enough to move this highly valued stock."
Shares of VMware, which is majority owned by data storage company EMC Corp., rose $4.53, or 5.1 percent, to $94.05 in morning trading. The stock is up 5.8 percent year-to-date.
A representative for the company did not immediately return a message for comment on the analyst report Tuesday morning.