My apologies. I promised this article yesterday, but didn't have time until now.
I closed VmWare (VMW) position yesterday. It was done according to plan, outlined in annual portfolio review. I waited for a better price, but missed the opportunity back in March.
Company missed earnings target two quarters in a row. That's enough. These misses is a confirmation of my thesis: cloud computing moves out of IT departments to specialized companies. The biggest IaaS (infrastructure as a service) providers are Google (GOOG) and Amazon (AMZN). Neither of them uses VmWare software. Other companies trying to crack IaaS and PaaS (platform as a service) are IBM (IBM) and Microsoft (MSFT). They don't use VmWare either. For me, Google and Amazon are obvious winners here. For VmWare, it doesn't matter though, they are losers in either case. Their product was designed for internal clouds.
Bye, VMW. It was a good run, with a good overall profit.
Disclosure: I am long GOOG.
Additional disclosure: Positions can change any time
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