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VMware, Citrix Reveal Q2 earnings; IDC Charts Wider Market Numbers

For the third quarter of 2009, VMware reported U.S. revenues of $246 million (down 1 percent), international revenues of $244 million (up 9 percent), and services revenues -- including software maintenance and professional services -- of $250 million (up 33 percent).

The suddenly volatile Citrix reported a global decline in Q3 license revenue of 18 percent (-15 percent in EMEA, -5 percent in APAC, and +5 percent in the Americas). Revenue generated from license updates increased 7 percent, while technical service revenue from consulting, training and technical support increased 20 percent. Lastly, online services revenue increased 21 percent.

IDC's numbers illustrate the ups and downs of the virtualization market as it rides out the economic storm. According to IDC's Worldwide Quarterly Server Virtualization Tracker, 16.5 percent of all new servers shipped during Q2 of 2009 were virtualized, an increase of 14.5 percent over the same period a year ago.

However, actual shipments decreased 21 percent to 246,000 physical servers because of what IDC cites as a continuation of the 2008 decrease in this area. Similarly, worldwide virtualization software revenue declined 18.7 percent to $344 million.

On the product front, IDC says the server virtualization market is continuing its shift toward the use of paid hypervisors, with paid-for virtualization software now running on 60.8 percent of all new server hardware shipments virtualized in 2Q09, a 57.2 percent increase over the second quarter of last year.

IDC's take on these numbers is that they represent growing stability, and the market is poised for the beginning of a "significant infrastructure refresh cycle in the months ahead."

When it comes to new, virtualized server shipments worldwide, HP remained numeral uno with 36 percent of the market. Although those shipments were down 18 percent from Q208, they grew 1 percent sequentially. These numbers were primarily driven by HP's x86 ProLiant server business.

Despite a year-over-year decline of 22 percent, VMware retains its 1-2 punch as the leader in virtualization platforms. That decline was just a tick more than its 21 percent drop in x86 virtualization licenses. For its part, Microsoft saw its virtualization license shipments go down 16 percent, as a result of the continued depreciation of Virtual Server 2005. Hyper-V is the better-news Microsoft story here, as it jumped 54 percent one year after its official launch, which landed it into fourth place "while it cannibalizes itself into the number three position, past Virtual Server 2005," IDC notes. Parallels Virtuozzo rounds out the top five with license shipments declining 36 percent.

Citrix XenServer showed the largest increase, growing 108 percent during the past year, a jolt IDC attributes to the company changing its business model (IDC obviously had no idea of the full open-sourcing XenServer announcement when it issued this Q2 press release), and offering XenServer free with certain management functionality.

Posted by Bruce Hoard on 10/29/2009 at 12:48 PM


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