Nutanix is finally happy to mention its name and ‘profit’ in the same sentence
Give it a year or two, but it will happen, says CEO, as COVID-crushed industries start spending again
Nutanix has told investors it has a “clear path to profitability” and predicted it could post black ink in just two years.
The hyperconverged upstart made that prediction at an investor day on Tuesday at which CEO Rajiv Ramaswami offered investors the slide below.
Nutanix reported its Q3 2021 results in late May 2021. Ramaswami therefore told The Register that cashflow positivity is within reach by the end of the 2022 calendar year, and actual black ink could flow during 2023. The company was founded in 2009 and floated in 2016.
The CEO said the company’s conversion to subscription plans is the prime reason for the sunny forecast, as it allows Nutanix to predict revenue while also requiring less effort to renew subscriptions than to make new sales. Ramaswami said that Nutanix can’t help but engage with customers more frequently when they’re subscribers, to ensure they are getting value for money from their monthly fees. That increased contact creates opportunities — both to ensure customer satisfaction and to sell more stuff — and also lowers sales and marketing costs.
Ramaswami also told investors that Nutanix has moved from investing for growth to more judicious use of its resources. The result of that approach is that the company will put more effort into markets it sees as natural additions to its portfolio and likely to appeal to current customers. He therefore emphasised Nutanix’s belief in the potential of its managed database and hybrid cloud businesses, but said efforts like ensuring the latter works on the Arm CPUs increasingly favoured by big clouds can wait until a proven market has formed.
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The CEO was also optimistic because he sees industries that depend on discretionary spending and tourism start spending again.
“Last quarter we started seeing orders from casinos, also the transport and hospitality sectors” he said, suggesting that their need for more tech signals a widespread relief that the global economy is recovering the COVID-created recession.
Nutanix has also announced that Virginia Gambale will become the new Chair of its Board. Gambale is Managing Partner of strategic advisory firm Azimuth Partners LLC, and already chairs the company’s Nominating and Corporate Governance Committee and sits on its Audit Committee. She succeeds company founder Dheeraj Pandey.
Ramaswami said her appointment expresses another Nutanix priority — namely using diversity as a differentiator, as opposed to its previous stance of opportunistic diversity. ®