During its first quarter of fiscal year 2018 earnings call, Dell Technologies reported strong demand for its hyperconverged infrastructure (HCI) systems — these products grew at a triple-digit rate.
This was the second earnings report since Dell merged with EMC, forming Dell Technologies. The company said consolidated revenue was $17.8 billion and non-GAAP revenue was $18.2 billion. During the quarter, the company posted a non-GAAP operating income of $1.2 billion.
This was the first quarter that Dell and EMC fully integrated their sales teams and annual plans, said Chief Financial Officer Tom Sweet, who added: “we faced component cost headwinds in certain areas,” according to a Seeking Alpha transcript of the call.
HCI, Cloud Generate Revenue
The company’s Infrastructure Solutions Group — this includes its PowerEdge servers, all-flash arrays, hyperconverged systems, software-defined storage, and other cloud computing technologies — generated $6.9 billion of revenue in the first quarter. This includes $3.2 billion in servers and networking and $3.7 billion in storage, with an operating income of $323 million.
The company saw growing customer interest in its Virtustream Public Cloud as well. It said demand for mission-critical applications increased by about 100 percent.
Dell Technologies inherited Virtustream’s cloud platform in the merger with EMC.
“And later this year, we’ll introduce a Virtustream addition of our Enterprise Hybrid Cloud to encompass mission critical workloads on-prem with seamless connections to Virtustream public cloud,” said David Goulden, president of Dell Technologies. The company also saw growth in its Native Hybrid Cloud solutions, he added.
VMware, Pivotal Boost Bottom Line
Revenue for the company’s other businesses helped Dell Technologies’ bottom line. VMware segment revenue for the first quarter was $1.7 billion, with operating income of $486 million, or 28 percent of revenue.
VMware hosted its own earnings call on June 1. The company said its revenue grew 9 percent in the first quarter, boosted by its virtualization software sales and partnerships with cloud providers.
“We have started to see revenue synergies materialize as our innovation activities continue, and we see momentum across most of VMware’s portfolio that continued,” Sweet said. “Specifically, emerging technology saw strong growth, driven by vSAN and NSX.
Revenue from Dell Technologies’ other businesses, which include SecureWorks, RSA, Pivotal and Boomi, was $462 million.