Since hitting a low of just over $14 a share in mid-2022, Nutanix Inc.’s stock price trajectory has been mostly up and to the right.

Shares closed at over $64 on Friday, nearly doubling over the past six months. The company’s fiscal second-quarter financial results topped revenue and earnings expectations on steady organic growth, and Chief Executive Rajiv Ramaswami (pictured) sees no sign of a slowdown.

“People are still being careful about opening their wallets, but they’re still willing to spend money,” he said in an interview with SiliconANGLE.

Nutanix intends to take full advantage of the anxiety in VMware’s customer base caused by Broadcom’s post-acquisition moves, which included laying off more than 1,800 VMware employees in December, killing perpetual software licenses, discontinuing nearly 60 stand-alone products and shifting to a bundled packaging model. Broadcom also assumed primary sales responsibility for VMware’s largest 1,000 accounts, leading some resellers to charge that they had been left out in the cold.

All this is an opportunity for Nutanix, which competes head-to-head with VMware for virtualization dollars. Although Ramaswami said it’s difficult to estimate the impact of VMware’s turmoil on his business at this point, “I would say the doors are more open now than they ever were before,” he said. “We’ve got more engagement with concerned customers than we would traditionally have seen.”

Specifically, he said, customers fear Broadcom’s bundled offerings will result in higher prices and less flexibility to choose point products. Broadcom is also perceived as “not a customer-friendly company. The old partner program was canceled, and partners are looking to see what the new program will look like, so that is also creating a fair bit of turmoil.”

Nutanix is responding by increasing its advertising and incentives for channel partners and customers to migrate. “We have a lot of automation for migration that we’ve been doing for years,” he said. “Tools like Nutanix Move enable automated workload migration running on a [VMware virtual machine] to a Nutanix Hypervisor.”

Gen AI still on launch pads

Generative artificial intelligence is another growth vector, but the impact isn’t showing up yet in Nutanix’s results. Six months after the company announced GPT-in-a-Box, a full-stack, software-defined toolkit for building artificial intelligence applications, customer uptake has been modest. “It’s still early days,” Ramaswami said. “Most of our customers are still experimenting and trying to figure out where they can use generative AI to get tangible benefits.”

Nutanix uses GPT-in-a-Box internally for customer support and is folding AI into other parts of its product line. Its Nutanix Cloud Manager for Intelligent Operations uses machine learning to optimize for capacity, proactively detects performance anomalies and enables codeless automation of operations tasks.

In the customer support realm, he said, “We are now looking at a gen AI engine to go through all our support history, knowledge base articles and design documents to quickly triage and understand what potential root causes [of problems] might be.”

Ramaswami said the surge of experimentation in generative AI is influencing customers’ decisions about where to deploy workloads, with some operations shifting back on-premises. “Ultimately, the AI workload has to run wherever the data is,” he said. “Some data companies may feel fine putting it in the public cloud and leaving it there. But a lot of data is sitting inside data centers and at the edge.”

Three or four years ago, most chief information officers were looking for ways to move more workloads to the cloud. “If you were to ask the same CIOs today, they would say the public cloud has a role, but it’s also expensive, and for privacy, security or regulatory reasons they will continue to have an on-prem environment,” he said. “A lot of data is generated at the edge and AI inferencing has to be done in a local computer platform.”

Photo: Nutanix