VMware, Inc

Q1 Rev Est.:  $817.54 Mil

Q1 EPS Est.:  $0.42

VMware will report first quarter earnings after today’s closing bell.  Analysts, on average, are expecting quarterly revenue of $815.35 Mil with earnings of $0.42. 

My models are predicting slightly higher revenue of $817.54 Mil with earnings of $0.42.

Revenue

Once again, averaging each model’s quarterly projection plus the standard error appears to provide a relatively accurate estimate of revenue.

Exhibit 1

Q1-2011 Prediction
Model	Prediction	W/ St. Err.
First-Order	$773,044	$818,643
Deasonal	$776,921	$833,182
Dummy	$761,339	$805,931
Lagged	$760,847	$812,411
AVERAGE	$768,038	$817,542
PREDICTION	$817,542

Earnings

My estimate of earnings is in line with analysts’ consensus of $0.42 per share.  Exhibit 2, below, reflects a gross margin of 14.7%.

Exhibit 2

Income Statement
Three months ended March 31, 2011
Total Revenue	$817,542
Operating Ex:
Cost of License Revenue	50,824
Cost of Service Revenue	89,752
R&D	179,859
Sales & Marketing	302,490
G&A	74,226
Total Operating Ex	697,152
Operating Income	120,390
Investment Income	2,648
Interest Ex	-1,093
Other Income	-3,546
Income Before Taxes	118,400
Provision for Income Taxes	21,111
Net Income	97,289
EPS	$0.42

VMW Ownership

Author:   Yes

Author’s Family:  NO

Disclaimer:
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