Dell has signed a definitive agreement to acquire Wyse Technology, a global leader in cloud client computing, to significantly extend its desktop virtualization offerings and provide new market opportunities for the full range of Dell’s data center solutions and services. Wyse Technology, ranked #1 in thin client unit shipment volume in 4Q 2011, has grown revenues ~45% in the last year to ~$375M. IDC estimates that overall worldwide thin-client demand will grow 15% to approximately $3 billion by 2015 and that the end-to-end datacenter infrastructure stack for these solutions is expected to exceed $15 billion by 2015.
Dell’s existing desktop virtualization offerings include Desktop Virtualization Solution Simplified and Desktop Virtualization Solution Enterprise and its recent Desktop as a Service (DaaS) partnership with Desktone. Today, we take another step forward moving from sharing desktop virtualization intellectual property to owning IP with a more profitable, industry leading, and complete end to end desktop virtualization solution. The Wyse product portfolio includes industry-leading thin, zero and cloud client solutions with advanced management, desktop virtualization and cloud software supporting desktops, laptops and next generation workload scenarios. Wyse’s differentiation includes a customized thin client OS customized for the 3 major VDI platforms (VMware, Citrix, Microsoft) as well as over 140 software engineers. That type of differentiation allows Wyse to provide solutions that require less memory and processing power driving a lower cost to customers.
While this announcement is exciting for Dell on the end user computing side, it also holds promise for our data center solutions and services businesses as well as our software and cloud businesses. Our ability to now offer an industry-leading cloud client computing solution will provide opportunities for Dell to further accelerate the growth of our server, storage, networking, and services, lines of business, given the requirements necessary to support this type of environment. In addition, it will provide future opportunities in mobility and cloud computing. These include infrastructure management and content management-as-a-service solutions from the cloud to customers of all sizes.
The transaction remains subject to customary closing conditions. It is expected to close in early Q2 FY13 and is expected to be accretive to Non-GAAP earnings in the 2nd half of FY13. We are not disclosing the terms of the transaction. You can listen to a replay of the webcast with Dell executives discussing the acquisition and access related material here. You can also download a copy of the presentation by clicking on the PDF below this post or by clicking here.
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