Broadcom CEO Hock Tan has announced his intention to divest VMware’s end-user computing and Carbon Black units.
Speaking on Broadcom’s Q4 2023 earnings call, Tan told investors “We are now refocusing VMware on its core business of creating private and hybrid cloud environments among large enterprises globally and divesting non-core assets.”
He then named VMware’s end-user computing portfolio – which comprises desktop virtualization, application publishing, and mobile device management – as one asset to be divested. The Carbon Black security software unit is also on the way out.
“Our strategy going forward is to enable global enterprises to run apps across datacenters and public clouds by consuming VMware’s high value software stack,” Tan explained, adding: “To attract and retain workloads we are investing in microservices tools.”
In its Form 8-K, Broadcom revealed it “expects to take charges of approximately $1.3 billion through fiscal year 2025 for the implementation of cost reduction activities.”
Public filings suggest VMware has axed over 2,000 jobs in the US. The Register has made several requests to Broadcom to detail those job cuts, and how they will change the experience of working with VMware. Broadcom has not responded.
Tan’s remarks about Broadcom’s plan to focus on global enterprises reflect the playbook the voracious conglomerate followed after the acquisitions of CA and Symantec, which both saw product development focus on the needs of larger customers. Smaller users – and the partners who serve them – reported indifference from Broadcom.
Hock Tan has in the past made many public statements that offered words of reassurance to all VMware users.
Broadcom forecast VMware will generate $12 billion of revenue for eleven months of its next financial year – excluding $2 billion for end-user computing and Carbon Black. Most VMware licenses will be moved to subscription by the end of Broadcom’s FY 2024.
This is a developing story that The Register will update as Broadcom’s earnings call continues. ®
Wanda Parisien is a computing expert who navigates the vast landscape of hardware and software. With a focus on computer technology, software development, and industry trends, Wanda delivers informative content, tutorials, and analyses to keep readers updated on the latest in the world of computing.
