"The first inning [of hyper-converged infrastructure] was the convergence of all the legacy stuff into hyperconverged, and the second inning is really convergence of clouds," according to Rajiv Ramaswami, CEO of hyper-converged infrastructure pioneer Nutanix.
Ramaswami talked to ZDNet following the company's fiscal Q4 report this afternoon. The company's revenue and profit in the July quarter both topped Wall Street's expectations, as did the outlook for billings for the current quarter.
Nutanix shares rose 5% in late trading following the conference call between Ramaswami and CFO Duston Williams and Wall Street analysts.
Ramaswami's comments to ZDNet came in response to the question whether hyperconverged products are merely for consolidating legacy equipment, or whether the product category has sustained relevance in the years to come.
Ramaswami's point is that as company's scale in their use of public cloud, costs rise dramatically and complexity rises, and hyperconverged takes on a new role in "inning two" as a way to reduce cost and complexity.
"We are making it easier for customers to run in the public cloud of their choice, while having their portability and being free from public cloud lock-in."
Ramaswami said Nutanix has been making progress "doubling-down" on the company's partnerships for selling, such as with Amazon's AWS, Hewlett Packard Enterpise, and Red Hat, a goal that he had discussed with ZDNet back in February.
"We are doing more work with HP GreenLake," he said, referring to Hewlett's database-as-a-service, a partnership mentioned back in June. "And they [Hewlett] are now selling more of our entire portfolio, not just the core," he said. "And we announced our partnership with Red Hat, which is a pretty substantial partnership for us," said Ramaswami.
In prepared remarks, Ramaswami had called the quarter "a strong end to an excellent fiscal year, which was marked by consistent execution and solid progress across both financial and strategic objectives."
Added Ramaswami, "We have entered our fiscal 2022 with good momentum and a solid plan for growth, executing on the model we laid out at Investor Day and delivering on our vision of making clouds invisible."
CFO Williams remarked that "We achieved records across a number of key metrics in the fourth quarter, including ACV billings and revenue, which grew 26 and 19 percent year over year, respectively," adding, "In fiscal 2022, we expect our growing base of low-cost renewals will drive further improvements in top and bottom line performance."
Revenue in the three months ended in July rose 19%, year over year, to $390.7 million, yielding a net loss of 26 cents a share, excluding some costs.
Analysts had been modeling $363 million and a 42-cent loss per share.
Nutanix's annualized recurring revenue rose by 83% to $878.7 million.
Nutanix's billings for its annual contract value, or "ACV," rose by 26% to $176.3 million, it said. That was higher than Wall Street's average estimate for $171.9 million.
ACV billings is the main metric to track how the new sales incentive policy is playing out, in terms of bringing in a big quarter-to-quarter boost in amounts billed. It's a mark of its progress in moving from what was once a license for equipment to what is now essentially a subscription software business.
For the current quarter, the company expects its annual contract value billings to be in a range of of $172 million to $177 million. That compares to consensus for $169.3 million.