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Nutanix's (NTNX) Cloud Platform to Help Toyota's Remote Workers

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Nutanix NTNX recently announced the addition of Toyota Motor Corp to its customer roster. The automobile manufacturer has leveraged the Nutanix cloud platform to develop a virtual desktop infrastructure (VDI) to increase the productivity of its Engineering Design Group.

Importantly, the VDI will support the 3D CAD software, eliminating the need for Toyota employees to go to the office and access their physical workstations to work on 3D CAD-backed design projects. Moreover, the VDI will help Toyota reduce workstation maintenance and procurement costs.

The Nutanix cloud platform can support Virtual Graphics Processing Unit functions needed to generate 3D graphics in HCI virtual environments. This capability makes the company stand out among other cloud providers. Another factor that influenced Toyota’s decision to choose Nutanix was the flexibility and scalability offered by the latter to help the former quickly adapt to the evolving business demands.

Nutanix Inc. Price and Consensus

Nutanix Inc. Price and Consensus
Nutanix Inc. Price and Consensus

Nutanix Inc. price-consensus-chart | Nutanix Inc. Quote

The abovementioned strengths enabled Nutanix’s cloud platform to create a VDI environment for up to 1,000 devices and exceeded Toyota’s initial schedule expectation.

Nutanix is considered a pioneer in the hyper-converged infrastructure (HCI) market, which is projected to grow rapidly in the long term. Per MarketsandMarkets, the global HCI market is expected to grow to $27.1 billion by 2025, witnessing a CAGR of 28.1% during the 2020-2025 period. Strong adoption of its products and a high customer satisfaction rate are expanding the customer base. This along with a recurring revenue stream is expected to drive the momentum in top-line growth.

Nutanix’s software-defined HCI solutions support multi-hypervisor and multi-cloud with unified management. Its solutions are primarily deployed in large and centralized data centers. The company’s built-in hypervisor has been gaining significant traction as customers continue to select it as a low-cost alternative to other vendor offerings. Nutanix’s cloud-based deployment strategy is a differentiator. The company’s Xi Cloud Services is expected to challenge Amazon’s AMZN AWS cloud arm, Microsoft’s MSFT Azure and Alphabet’s GOOGL Google Cloud in the IaaS market.

Its growing recurring revenue stream reflects customer loyalty to Nutanix’s solutions, which improves the visibility of the revenue growth trajectory. Moreover, the expanding customer base will continue to drive top-line growth. During third-quarter fiscal 2021, the company added 660 new customers, bringing the total client numbers to 19,430. Besides, its transition to software-only sales is expected to significantly boost the gross margin.

Nutanix 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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