Dive Brief:
- Nutanix touted public cloud as a stopgap measure to allay rising component costs and supply chain constraints on Wednesday, during a Q3 2026 earnings call for the three months ended April 30. “There is no doubt that server constraints — enterprise server constraints — are causing customers to look more at the public cloud,” Nutanix President and CEO Rajiv Ramaswami said.
- The virtualization vendor saw revenues increase 10% year over year to $703 million and annual recurring revenue surpassed $2.4 billion as disaffected VMware customers migrated workloads to the Nutanix cloud platform and clusters that run its software in hyperscaler infrastructure. Chipmaker Broadcom purchased VMware for $61 billion three years ago.
- “That's where most of our customers are coming from or migrating away from,” Ramaswami said. “They go to Nutanix, they go to Red Hat, they go to Microsoft, and then some of them go to the public cloud directly. That's the competitive landscape. It hasn't really changed much in the last several quarters.”
Dive Insight:
Disruption in the VMware ecosystem unlocked a vast base of potential customers for alternatives to the dominant hypervisor. The more recent chip shortage, which continues to drive up PC, server and CPU prices, has opened another lane of opportunity for Nutanix.
The company forged an alliance earlier this year that connected its cloud platform to Pure Storage FlashArray storage. The integration “directly challenges VMware’s long-standing dominance in enterprise virtualization,” Alastair Cooke, hybrid cloud and infrastructure research director at the Futurum Group, said in a January blog post.
Nutanix plans to expand its web of storage options to Dell PowerStore later this year and NetApp ONTAP, which is part of a deal inked last month. The company also deepened a partnership with Lenovo in April, which included integrating Nutanix Cloud Infrastructure with the PC vendor’s ThinkSystem storage solution.
The storage moves give cost-conscious customers a way to navigate component shortages.
“The majority of current data center infrastructure is based on external storage and legacy hypervisors on servers,” Ramaswami said. “Our support of external storage platforms is simplifying migrations to Nutanix from these environments without requiring significant hardware changes.”
As Nutanix rolls out the integrations and adds agentic AI capabilities to the core platform, it’s reshaping its channel to help drive migrations. In April, the company unveiled a multitenant cloud for service provider partners along with onboarding incentives for providers leaving VMware. Nutanix Partner Center, an upgraded channel hub, went live in October 2025.
The company has a three-tiered go-to-market strategy that leans on partners to lead a midmarket charge. “There's more customers available in the lower tiers than in the upper tiers,” Ramaswami said Wednesday. “From a distribution perspective, we are seeing wins across all of them.”
