VMware’s NSX clinched its largest ever deal last quarter
Earlier in the series, we discussed VMware’s (VMW) recent buyout of Wavefront. Let’s see how one of its new offerings in the networking space has performed in the most recent quarter.
In its fiscal 4Q16 earnings release, VMware shared that the company had closed an “NSX-only deal” that surpassed $10 million in the quarter. This was the largest ever NSX-only deal VMware had recorded to date.
Last quarter, its customer base rose to close to 200.0% on a YoY (year-over-year) basis to reach 2,400 in 4Q16. Its license bookings rose 50%.
NSX has a $1 billion run rate
On the annualization of NSX’s fiscal 4Q16 total bookings, VMware said, “It is now in a $1 billion run rate.”
NSX, a part of VMware’s SDDC (software-defined data center) architecture, is a virtual networking and security software platform. It is part of the VMware Cloud Foundation and VMware Cloud on Amazon’s (AMZN) Amazon Web Services and is thus integral to the company’s Cross-Cloud architecture. In the past, we’ve discussed how NSX will set the pace for the company’s future growth.
Stating NSX’s importance and contribution to VMware’s growth prospects, VMware said, “NSX is clearly becoming a mainstream part of all of our solutions.”
VMware’s NSX growth, which operates in the SDN (software-defined networking) market, is timely, as this space is poised for significant growth in the future.
In its 2016 report, the IDC (International Data Corporation) stated that it expected the SDN market to grow at a CAGR (compound annual growth rate) of 53.9% between 2014 and 2020 to reach $12.5 billion by 2020.
NSX will also benefit from its recent acquisition of PLUMgrid in early 2017. NSX faces a threat from Cisco’s (CSCO) ACI (Application Centric Infrastructure). Cisco’s Nexus ACI is a data center networking architecture designed to deliver business and other applications to end users in a cost-effective way.