Maybe VMware CEO Pat Gelsinger does own a crystal ball.
The company’s NSX networking portfolio boosted the company’s first quarter fiscal 2019 revenue, which grew 14 percent year over year to $2.01 billion. License bookings for NSX products grew more than 30 percent, and all 10 of the quarter’s top deals included NSX.
At last year’s VMworld conference Gelsinger predicted “what vSphere was to the first 20 years of VMware, NSX is to the next decade or two.”
And on yesterday’s earnings call with investors, Gelsinger again said he expects the networking piece of VMware’s business to grow even bigger than compute.
NSX Networking Portfolio
During the quarter the company added several new networking products and features, and it changed the name of its original networking offering — NSX — to NSX Data Center. This product also added support for containerized cloud-native and bare metal applications.
Additionally, VMware expanded NSX Cloud capabilities. This is the company’s software-as-a-service (SaaS) product that supports vSphere-private clouds, native Amazon Web Services (AWS) workloads, VMware Cloud on AWS, and now also Microsoft Azure.
It also added NSX SD-WAN, which includes the SD-WAN technology VMware acquired when it bought VeloCloud last year. NSX SD-WAN integrates with NSX Data Center and NSX Cloud.
And it added NSX Hybrid Connect to provide cloud migration capabilities and consistent networking across hybrid cloud environments.
AppDefense also falls under its NSX portfolio. In April VMware added container security and other capabilities to its standalone security product.
VMware has 4,500 customers for NSX, and one way it plans to grow this number to “hundreds of thousands” is by offering a mid-market networking product, Gelsinger said. “NSX [is] still largely a high-end product. We haven’t really brought it into the mainstream offering and that’s something that we are definitely working on for the future.”
Gelsinger pointed to NSX SD-WAN as an example of a “much more consumable simple product with a narrower use case but a broader market appeal.” It has 2,000 customers, he said.
“As we broaden the family you will see us creating versions of [NSX] that are more mid-market focused and attacking many other use cases — containers, multi-cloud, native cloud, hybrid use cases, security use cases,” Gelsinger said. “All of those together really give us this perspective that NSX for the long-term has a larger market opportunity than compute.”
‘Multi-Billion Dollar’ HCI, SD-Storage
VMware’s software-defined storage, vSAN, and its VxRail hyperconverged infrastructure (HCI) product it developed with Dell EMC also saw strong growth during the quarter. Standalone vSAN sales plus the vSAN portion of VxRail sales grew 70 percent year over year. Additionally, all of VMware’s top 10 deals included the company’s SD-storage product.
“vSAN and VxRail customer counts now over 14,000 as we ended Q1 and [has] a very solid trajectory,” Gelsinger said. “We see that vSAN and the software-defined storage and HCI is a multi-billion dollar business.”