(Recasts, adds analyst comment, updates shares)
Jan 28 Software maker VMware Inc said on
Monday it was cutting 900 jobs as part of a restructuring plan,
and it gave a disappointing outlook for 2013. Its shares fell 13
percent in after-hours trade.
VMware, a publicly traded division of data storage equipment
maker EMC Corp, said in a filing that "to enable the
company to focus its business on strategic areas" it planned "to
streamline its operations."
VMware did not elaborate in the filing but said it expected
to complete the move by the end of the year and that it would
take a charge of $90 million to $110 million.
The company, which also reported solid fourth-quarter
earnings on Monday, offered an outlook for 2013 that did not
It said it expects revenue of $1.17 billion to $1.19 billion
for the first quarter, an increase of 11 percent to 13 percent
but short of the $1.25 billion estimated by analysts on average.
For the full year it forecast revenue of $5.23 billion to
$5.35 billion, lower than estimates of $5.42 billion.
"They delivered a strong quarter but investor eyes are
focused on the outlook," said FBR analyst Daniel Ives.
He added that VMware tended to be conservative in its
But Mizuho Securities analyst Abhey Lamba said that
"management's 1Q13 outlook is significantly below normal
seasonality, which could raise doubts about the company's longer
term growth potential".
Revenue was $1.29 billion, sightly above average analyst
expectations of $1.28 billion, according to Thomson Reuters
VMware shares fell 13 percent to $85.50 in after-hours
trade, after closing at $98.32 on the New York Stock Exchange.
(Reporting By Nicola Leske; Editing by Steve Orlofsky)