Shares of Nutanix (NASDAQ:NTNX) soared more than 7% in pre-market trading Wednesday after Google parent Alphabet Inc. (NASDAQ:GOOGL) announced a partnership with the cloud computing company.
According to CNBC, the agreement underscores Google’s desire to increase its offerings in the public cloud, a space where it directly competes with the likes of Amazon’s (NASDAQ:AMZN) Web Services and Microsoft’s (NASDAQ:MSFT) Azure.
“With public cloud, you have to meet them where they are—that’s becoming increasingly clear,” Google’s head of global alliances, Nan Boden, told CNBC.
Nutanix develops solutions that help connect in-house severs with cloud data centers. The company will reportedly continue to work on application deployment on AWS and Azure, but its new agreement with Google will see the two companies work more closely together.
After reaching a private valuation of nearly $2 billion, Nutanix filed for an initial public offering in late 2015. The company’s debut was actually delayed due to the sluggish IPO market at the time, but Nutanix eventually held its initial offering for $16 per share in September 2016.
Nutanix shares skyrocketed shortly after their debut, but since then, it’s been a steady slump back down to levels near their IPO price. However, a fresh agreement with Google could be exactly what the company needs to get going.
For now, Nutanix remains severely in the red, although that’s not uncommon for today’s young tech companies. Sales growth appears strong, as our current consensus estimates are calling for full-year revenue growth of nearly 70%.
Regardless, NTNX is currently a Zacks Rank #3 (Hold).
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