VMware (VMW) to Report Q4 Earnings: What's in the Cards?
VMware VMW is slated to release fourth-quarter fiscal 2022 results on Feb 24.
For the quarter, total revenues are expected to be roughly $3.51 billion, suggesting 7% year-over-year growth. Non-GAAP earnings are expected to be $1.96 per share.
The Zacks Consensus Estimate for quarterly earnings has been unchanged over the past 30 days at $1.97 per share, suggesting 10.9% decline from the figure reported in the year-ago quarter.
Further, the consensus mark for revenues is pegged at $3.52 billion, indicating a 6.9% increase from the year-ago reported number.
VMware, Inc. Price and EPS Surprise
VMware, Inc. price-eps-surprise | VMware, Inc. Quote
VMware’s earnings beat the Zacks Consensus Estimate in all of the past four quarters, the average earnings surprise being 7.17%.
Let’s see how things have shaped up prior to this announcement.
Key Factors to Note
VMware’s strong product portfolio, along with robust uptake of cloud and security solutions, is expected to have driven its top line in fourth-quarter fiscal 2022.
VMware’s widening cloud customer base is being driven by partnerships. The momentum is expected to have continued in the to-be-reported quarter.
The company is gaining from the ongoing cloud-based digital transformation, and increasing traction witnessed for subscription and software-as-a-service (SaaS) offerings. The subscription and SaaS business is being driven by the robust uptake of modern applications, VMware Cloud Provider Program, End-User Computing, Carbon Black and VMware Cloud on Amazon Web Services.
VMware expects Subscription, SaaS and license revenues to be $1.875 billion in the fiscal fourth quarter, indicating roughly 9% year-over-year growth.
VMware is likely to have benefited from continued momentum in the company’s Tanzu platform across key verticals like financial services.
Synergies from the buyouts of Pivotal Software, Carbon Black and SaltStack are expected to have positively impacted the top line in the to-be-reported quarter.
What Our Model Unveils
Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here.
VMware has an Earnings ESP of 0.00% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are some companies worth considering as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:
Zscaler ZS has an Earnings ESP of +3.60% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
ZS is scheduled to release second-quarter 2022 results on Feb 24. Zscaler’s shares have gained 19.6% in the past year compared with the Zacks Internet – Services industry’s growth of 3.9%. The Zacks Computer and Technology Sector witnessed a fall of 0.8% over the same time frame.
Ambarella AMBA has an Earnings ESP of +2.86% and a Zacks Rank #3. The company is scheduled to release fourth-quarter 2022 results on Feb 28.
Ambarella’s shares have returned 11% in the past year compared with the Zacks Electronics-Semiconductors industry’s growth of 9.1%.
Docebo DCBO has an Earnings ESP of +16.67% and a Zacks Rank #3. The company is scheduled to release fourth-quarter 2021 results on Mar 10.
Docebo’s shares have fallen 0.4% in the past year compared with the Zacks Internet - Software industry’s decline of 50.6%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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