Nutanix posted better-than-expected revenue and rolled out the long-awaited Xi Cloud Services on Tuesday.
The company reported a first quarter fiscal 2019 non-GAAP net loss of 13 cents a share, while Wall Street expected a net loss of 27 cents a share as it transitions to a subscription-software business model. It posted revenue of $313.3 million, a 13.7 increase year over year, which also beat analysts’ estimates of $305.3 million.
Software and support revenue reached $280.7 million, growing 44 percent year over year from $194.7 million in the first quarter of fiscal 2018. And software and support billings grew 50 percent year over year to $351 million, compared to $234.5 million in the first quarter of fiscal 2018.
“Notably, subscription revenue increased 104 percent year over year as we shift our business to an increasingly subscription-based consumption,” CEO Dheeraj Pandey said on the conference call. He also challenged rival VMware to a dual, err, a proof-of-concept (PoC) battle.
“Our dominance in the core is why VMware avoids doing PoCs in accounts when we are in a head-to-head fight,” he said, citing a Q1 customer win. He didn’t name the customer but said it’s a major international airport in the Europe, Middle East, and Africa region and “one of the busiest in the world.”
“With this customer, VMware’s good-enough wasn’t good enough to create dynamic, cloud-grade platform for the majority of their core airport applications,” he said. Later on the call, Pandey added “we really want to go after PoCs, proof of concepts, with VMware.”
Also on the earnings call Pandey announced the availability of Nutanix’s new cloud services suite, Xi Cloud Services. “This launch is a watershed moment for our company,” he said.
Xi Cloud Services
“We did this because delivering a true hybrid cloud with a seamless experience that harmonizes the architectures of public and private clouds hasn’t been done before, and we made this decision to ensure our customers have that experience from their first interaction with Xi,” a Nutanix spokesperson told SDxCentral in May.
The cloud services are finally here and launching with five products, not just disaster recovery.
Xi Leap is the disaster recovery offering. It allows customers to protect their applications and data running in Nutanix private cloud environments by replicating them in Xi Cloud. From the Prism management console, customers select virtual machines for protection and drag and drop them into the cloud environment.
“The assurance it provides is two-fold,” said Greg Smith, head of product and technical marketing. “Because Xi Leap is built with the same software that is running in the customer’s data center, all the applications running on Nutanix today will run on Xi Leap. And because that ability to replicate a customer’s data center in a cloud allows for the protection of that data, if the data center has an outage or other type of failure, then they can recover the data in Xi Leap.”
This also reduces upfront investment costs because customers don’t need to buy and maintain a separate infrastructure stack. “It’s a pay as you grow cloud service,” Smith said.
The other cloud services include:
Xi Frame, a desktop-as-a-service platform built specifically for cloud deployment and integrating role-based access control.
Xi Beam, a multi-cloud cost comparison and governance tool that works across that works across public and private clouds. It uses machine learning to make recommendations about where to place workloads to help save money. Nutanix originally launched this service in May. It uses Minjar’s Botmetric technology that Nutanix acquired in March.
Initially Beam supported Amazon Web Services (AWS) and Microsoft Azure, and last month the company said it would extend this multi-cloud view to on-premises Nutanix environments by the end of the year. That has now happened, and the service has been rebranded as part of Xi Cloud Services.
The company plans to extend Xi Beam to support Google Cloud and others. “The technology does make it cloud agnostic because it is entire API driven,” Smith said. “Based on customer demand, we do expect to add additional support for additional public clouds.”
The third service is Xi Epoch. This is an observability and monitoring service for multi-cloud applications that provides a Google Maps-like view of applications. It helps to determine performance bottlenecks and availability issues in any cloud environment.
And finally, Nutanix launched Xi IoT, an edge computing platform. This may sound familiar: Nutanix CEO Dheeraj Pandey first mentioned this edge platform, at the time code-named Sherlock, on an earnings call in May. This platform performs real-time processing of sensor and device data pipelines, and moves filtered data back to a customer’s cloud platform of choice.
The intent is to eliminate the complexity of deploying and managing edge locations while deriving more value from data at the edge. “You can’t afford the latency or the cost of backhauling all that data to a data center or a cloud,” Smith said. “Xi IoT It basically makes our IoT infrastructure invisible so customers can focus on their newly developed IoT and edge applications.”