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I work in enterprise saas as well and I can't imagine how bad this customer must be that they can break pricing unless VMware runs really low margins vs the ind

I work in enterprise saas as well and I can't imagine how bad this customer must be that they can break pricing unless VMware runs really low margins vs the industry. There must be other things as well 8m is 0.6% of their revenue, and they grew in revenue 4% from 2022 to 2023[1]. Losing 0.5% kinda hurts when they are growing that slowly. That 8m can't be that easily magicked out of existing customers or the freed up resources supporting that customer they fired. I know nothing about their business or financials however [1]https://finance.yahoo.com/news/vmware-reports-fourth-quarter-fiscal-210500904.html?guccounter=1 https://finance.yahoo.com/news/vmware-reports-fourth-quarter...

alephnerd 3y ago
> There must be other things as well My hunch is an Account Team gave a heavily discounted deal to land an upper market customer in order to meet quarterly commitments or get a nice commission. The customer ended up accepting the $100M price-point as well (https://twitter.com/cioontherun/status/1761882689886433742 https://twitter.com/cioontherun/status/1761882689886433742), so they were clearly mis-tiered. If you can afford (what I assume is) a multi-year contract with a 9 figure TCV, you are generating 9 or 10 figures in revenue. I've heard of similar shenanigans down the grapevine at w/ Cisco and Dell EMC and absolutely wouldn't be surprised if a similar thing happened at VMWare.
- Rastonbury 3y ago
  If they accepted the 100m renewal then all is good for them, seems like a load of speculation about nothing - they were just simply overly discounted