The fortunes of data center infrastructure providers Nutanix Inc. and Pure Storage Inc. are in stark contrast today, with the companies offering very different outlooks for the current quarter.

Nutanix’s shares fell more than 16% after-hours on guidance that came in below Wall Street’s forecasts, while Pure was up by over 9% after posting an outlook that exceeded expectations.

In the case of Nutanix, the quarter just gone wasn’t that great either, for it reported some mixed results, beating forecasts on revenue but missing on earnings. It said its third quarter earnings before certain costs such as stock compensation came to 6 cents per share, improving on the 30-cent-per-share loss in the same period one year ago, but still below the street’s forecast of 17 cents.

Nutanix’s revenue increased by an encouraging 17%, to $524.6 million, beating the analyst consensus estimate of $516 million by a decent margin. All told, the company reported a net loss of $16 million, down from a loss of $71 million one year ago.

The company is a pioneer of so-called software-defined hyperconverged infrastructure or HCI, offering full-stack hardware that integrates compute, storage and networking components into a single appliance or cloud service. Although it made its name selling physical hardware, these days it has reinvented itself as a cloud infrastructure provider, while putting more focus on its hyperconvergence software that can run on third-party servers and systems.

Nutanix President and Chief Executive Rajiv Ramaswami (pictured) said the company’s “solid third quarter results” reflect its disciplined execution and the strength of its business model. “Our recent announcements around modern applications, generative AI and partnerships reflect our continued focus on driving innovation and broadening our partnerships to further enhance the value proposition of Nutanix Cloud Platform,” he added.

Ramaswami’s claims are backed up by some decent numbers in the quarter just gone, with the company delivering annual contract value billings of $288.9 million, up 20% from a year earlier. That’s a metric that reflects the total annualized value of a contract outside of professional services and hardware. It also reported annual recurring revenue of $1.82 billion, up 24% from last year.

In recent months, Ramaswami has been bullish about the company’s prospects given the ongoing turmoil at its rival VMware Inc., which has experienced almost nonstop disruption since being acquired by Broadcom Inc. last year.

In a March interview with SiliconANGLE, the CEO declared his company is ready to take full advantage of the anxiety in VMware’s customer base caused by Broadcom’s post-acquisition moves, which include thousands of laid off staff, the decision to kill perpetual licenses, the discontinuation of almost 60 products, and a shift to a bundled packaging business model.

“We’ve got more engagement with concerned customers than we would traditionally have seen,” he said.

However, though engagement is one thing, it would seem that getting those customers actually to jump ship is a much tougher challenge. Given the CEO’s optimism, investors must have been especially disappointed to see Nutanix’s guidance for the coming quarter fall short of expectations.

The company said it’s looking for revenue of between $530 million and $540 million, with full-year revenue set to land at between $2.13 billion and $2.14 billion. Both forecasts came in below the Street’s expectations, with analysts hoping for fourth-quarter revenue of $546 million and full year sales of $2.14 billion.

Despite the investor’s reaction, NAND Research Inc. analyst Steve McDowell said there are reasons to be optimistic about the company’s long-term prospects. For one thing, he believes that its revenue growth provides strong evidence that it’s benefiting from the tailwind created by the ongoing uncertainty at VMware. He added that this will continue until the end of the year at least.

But the company has a lot more going for it than just the uncertainty at VMware, the analyst said. “Nutanix’s roadmap is the strongest it has ever been, with its increased focus on Kubernetes and cloud-native workloads paying off,” he said. “There’s not really a competitor, apart from VMware, that can service as broad a swath of the market as Nutanix does.”

McDowell said the lower guidance is the result of the company participating in much bigger deals with longer sales cycles. “Infrastructure management software like Nutanix is a long-term commitment, and the disruption Broadcom caused with VMware has IT organizations taking a longer look at their choices in this space,” he said.

Pure Storage does it again

There were no such disappointments at Pure Storage, which kept up its multiyear-long string of earnings and revenue beats with yet another stellar set of results.

The company reported earnings before certain costs of 32 cents per share, breezing past Wall Street’s target of 21 cents per share, while revenue clocked in at $693.5 million, up 18%, some way above the consensus estimate of $680.9 million.

Pure Storage is a leading provider of enterprise-grade flash-based data storage hardware and software that’s designed to replace traditional hard drives. The company sells flash-based capacity storage, entry-level storage, and file and object storage systems. In addition, it offers cloud-based storage-as-a-service, as well as software for managing data storage.

Subscription services revenue came to $346.1 million, up 23% from a year earlier, while subscription-based annual recurring revenue totaled $1.4 billion, rising by an impressive 25% year-over-year. The company also reported an adjusted gross margin of 73.9%. The strong numbers helped Pure’s overall push towards profitability. It posted a net loss of $35 million for the quarter, improving considerably on the $67.4 million loss one year earlier.

Pure Storage Chairman and CEO Charles Giancarlo (pictured above) said the company is growing because its products are ideal for integrating fragmented data storage environments, which are one of the main obstacles hindering enterprise’s artificial intelligence and application deployments. “At our June Accelerate conference, global customers will see how our latest innovations enable enterprises to adapt to rapid technological change with a platform that fuses data centers and cloud environments,” he said.

The company is clearly on a roll, and it doesn’t expect it to end anytime soon. For the second quarter, it offered a revenue forecast of $755 million at the midpoint, above the Street’s $750.3 million target.

Photos: SiliconANGLE