(Reuters) - VMware Inc (VMW.N) reported better-than-expected quarterly profit and revenue for the fifth straight quarter on Thursday, as more customers licensed its software products.
The company’s shares rose nearly 4 percent to $142.54 in extended trading.
The Palo Alto, California-based company’s licensing revenue jumped 20.7 percent to $774 million in the first quarter, beating analysts’ average estimate of $727.3 million, according to Thomson Reuters I/B/E/S.
VMware’s services revenue, which accounts for more than 60 percent of its total revenue, rose 9.8 percent to $1.23 billion, in line with estimates.
Earlier this month, Dell Technologies Inc said it continues to consider a public offering of common stock or a combination with VMware, in which Dell owns a major stake.
VMware’s net income jumped nearly four-fold to $942 million, or $2.29 per share, in the quarter ended May 4.
The profit jump was mostly due to a one-time gain of $781 million from Pivotal Software’s initial public offering. Pivotal is a business software and cloud company that was formed in 2012 after spinning out of Dell EMC and VMware.
Excluding one-time items, VMware earned $1.26 per share, while total revenue rose 13.8 percent to $2.01 billion.
Analysts on average had expected a profit of $1.14 per share and revenue of $1.96 billion.
Reporting by Munsif Vengattil in Bengaluru; Editing by Maju Samuel