Nutanix’s ‘Two Largest Wins’ Came Through Partners As Company Posts Strong First Quarter

‘This last quarter our two largest wins came through partnering with service providers—these are service providers who in some cases will take us and sell through and provide a service to their customers,’ Nutanix CEO Rajiv Ramaswami says on the company’s earnings call.

Nutanix CEO Rajiv Ramaswami

The two biggest Nutanix deals last quarter came through its channel partners, CEO Rajiv Ramaswami said during the company’s earnings call Tuesday as Nutanix beat revenue guidance and achieved positive operating income for the first time in its history.

“This last quarter our two largest wins came through partnering with service providers—these are service providers who in some cases will take us and sell through and provide a service to their customers,” he said.

The two new customers were in data center in the U.S. and an EMEA-based publishing company, which is using Nutanix cloud to run all of its business applications and added Nutanix storage for data needs, Ramaswami said.

“We are seeing a trend in the market where more customers would like to consume more offerings delivered to them as a service. There are many routes to get there. One of the first routes is through service providers. ... HPE GreenLake is another approach. They can provide a combined hardware/software offering as a service in a subscription model to their customers.”

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Nutanix said in addition to beating revenue guidance by $22 million, it achieved positive non-GAAP income for the first time in the company’s history. Nutanix said it will begin providing updates on its free cash flow once a year.

Ramaswami once again said the looming acquisition of Nutanix’s chief rival, VMware, by Broadcom would not impact its fiscal 2023 outlook as the company’s sales cycles are typically between nine and 12 months. However, he said the Nutanix sales organization has seen “significantly higher levels of engagement” from prospective customers looking at Nutanix.

“We are all reading the news around Broadcom acquiring VMware. What we have seen is a significantly higher level of engagement from prospective customers. These customers are looking to explore their options, looking at managing potential risks related to the transaction. As you know, sales cycles for these larger deals tend to be around nine to 12 months so we’re not assuming any significant benefit from that in our fiscal 2023 outlook, but I can certainly tell you the volume of conversations with customers and prospective [customers] around this topic has increased and we are a good alternative provider.”

Nutanix reported first-quarter revenue of $433.6 million, up 15 percent from the same period last year. Nutanix’s annual recuring revenue increased to $1.28 billion, up 34 percent year over year.