24/7 Wall St.

VMware Inc. (NYSE: VMW) reported fourth quarter and full year 2012 results after markets closed today. For the quarter, the virtualization software maker posted adjusted diluted earnings per share (EPS) of $0.81 on revenues of $1.29 billion. In the same period a year ago, the company reported EPS of $0.62 on revenues of $1.06 billion. Fourth-quarter results compare to the Thomson Reuters consensus estimates for EPS of $0.78 EPS and $1.28 billion in revenues.

For the full year, VMware posted adjusted EPS of $2.85 on revenues of $4.61 billion, compared with a consensus estimate for EPS of $2.82 on revenues of $4.59 billion.

On a GAAP basis, VMware reported quarterly EPS of $0.47 and full-year EPS of $1.72.

The company’s CEO said:

2012 was a strong year for VMware, with solid Q4 results despite a tough economic environment. We see a tremendous market opportunity in 2013 and beyond, as we focus on what our customers value most: VMware’s role as a pioneer of virtualization technologies that radically simplify IT infrastructure from the data center to the virtual workspace.

It’s a little hard to believe that the company’s customers value VMware’s role more than its products, but that’s what the man said.

For the 2013 fiscal year, VMware expects to post revenues of $5.23 to $5.35 billion. For the first quarter of the new year, the company expects revenues to total $1.17 to $1.19 billion. That’s a decrease from the fourth quarter, and will likely give investors pause. In addition, VMware expects full year license revenue to rise by 8% to 11% in 2013, a lower annual growth rate than the 13% increase in licensing revenue in 2012.

The constrained growth outlook is hitting the shares in after-hours trading. VMware shares are trading down nearly 11% at $87.95 in a 52-week range of $79.46 to $118.79. Thomson Reuters had a consensus analyst price target of around $108.30 before today’s report.