UPDATED 20:37 EST / JUNE 29 2017

CLOUD

Nutanix’s Pandey talks new accounting rules, Amazon and why no finish line is just fine

Nutanix Inc. has made plenty of news already this week with announcements of new cloud services products and a major partnership with Google Inc. In the midst of it all, Nutanix Chief Executive Officer Dheeraj Pandey (pictured) serenely juggles the demands of Wall Street, customers, the media and analysts with the confidence that he’s moved into a technology space that seems to have unlimited potential for growth if he plays his cards right.

“From very early on the mission was invisible infrastructure. And the best part about this company is what we have chosen has no end to it,” Pandey said.

Pandey made his remarks during a visit to theCUBE, SiliconANGLE’s mobile livestreaming studio, and answered questions from hosts Dave Vellante (@dvellante) and Stu Miniman (@stu) during Nutanix.NEXT in Washington, D.C. They discussed the impact of new accounting rules, gross margins and the Nutanix work culture. (* Disclosure below.)

The Nutanix CEO addressed a requirement that his company must now comply with ASC 606, an accounting rule governing revenue from customer contracts. Nutanix currently has $465 million in deferred revenue, a portion of which must be pulled into the next quarter’s results,” he explained.

“In some ways it’s a good thing; in some ways it’s bad, because it takes away the goodness of the waterfall. We could have deferred more revenue,” Pandey said.

Potential sales shift from software to hardware

One upside, however, could be that there will now be “mixing that will happen with different margin profiles,” allowing Nutanix to sell more appliances, according to Pandey. This could turn out to be an important trend moving forward, as he emphasized that even though Nutanix sells a lot of software, it is still a hardware company.

“What if you kept it (gross margin) within the guard rails of around 60 percent and then went and sold more appliances because the software gave us the luxury to buy more growth?” Pandey said.

Asked about employee morale during the current period of growth, he said it was “just as good now as it was five or six years ago.” Pandey drew a comparison with Amazon, where the attitude may be different. “The delight for Amazon employees is the stock price,” Pandey said. “That’s the only delight they have.”

Pandey spoke about the enthusiasm he’d been hearing this week from conference attendees over recent announcements and the company’s direction. “A lot of the pieces around innovation in our company have worked in our favor. If we keep having that kind of luck for ourselves, good things will happen,” he concluded.

Watch the complete video interview below, and be sure to check out more of SiliconANGLE’s and theCUBE’s coverage of the Nutanix .NEXT US 2017 event. (*Disclosure: TheCUBE is a paid media partner for Nutanix .NEXT US. Neither Nutanix Inc. nor other sponsors have editorial control over content on theCUBE or SiliconANGLE.)

Photo: SiliconANGLE

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