It is a story about a strong father(EMC), a strong self(VMW), and a strong child(Pivotal).
1. VMW did give a surprise to Wall Street in its Q2 outlook. It is not VMW is underperforming, it is a miscommunication. VMW should have stated earlier that the transfer of assets/revenue to Pivotal would have an impact on its revenue from Q2, but this is just a miscommunication, it is not VMW is not performing well. Actually VMW is still growing as they promised. If you compare VMW with Citrix, you will see how well VMW is performing.
3. That doesn't change anything for VMW. Stock is still weak. It is viewed as being overpriced. Whether true or not, the perception is that there are open source alternatives that will cut into their revenue/profit stream. Most investors know that most times, perception will drive a stock more than the reality. The perception here is very bad. If you want to go against that perception and put your money down, go for it. However, there are plenty of less risky companies/stocks that you could put your money into at this time. Over the next few months do you seriously believe VMW shares will bounce back to $90 or $100? Most here know the probability is that it goes to $65 or $60 in the near term. If I were investing in VMW, I definitely wouldn't do it at this time. Will everyone "sell in May and go away"?