Tech

VMware could have 60% of staff working from home after coronavirus pandemic, CEO says

Key Points
  • VMware CEO Pat Gelsinger told CNBC a larger share of the enterprise software company's employees will work remotely as a result of the coronavirus pandemic. 
  • About 20% of the Palo Alto, California-based firm's staff worked from home prior to the crisis, Gelsinger said.
  • "I expect, as we continue in this environment, we're sort of going to end up in the 50% to 60% [range] over time, and I don't think we're atypical," Gelsinger said on "Squawk on the Street."
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VMware CEO Pat Gelsinger on earnings and the business impact of Covid-19

VMware CEO Pat Gelsinger told CNBC on Friday a larger share of the enterprise software company's employees will work remotely as a result of the coronavirus pandemic. 

About 20% of the firm's staff worked from home prior to the crisis, according to Gelsinger.

"I expect, as we continue in this environment, we're sort of going to end up in the 50% to 60% [range] over time, and I don't think we're atypical," Gelsinger said on "Squawk on the Street." "We're doubling, tripling the amount of work from home." 

Gelsinger's comments Friday are the latest indication the Covid-19 outbreak will usher in long-term changes to corporate America. Most employees at Jack Dorsey's two companies, Twitter and Square, have already been told they can work from home permanentlyFacebook CEO Mark Zuckerberg recently predicted as much as 50% of the social media giant's employees could be working remotely in the next five to 10 years. 

"Sometimes it takes a decade to make a week of progress. Sometimes a week gives you a decade of progress," Gelsinger said. "All of a sudden, education, health care, work from home, are making huge steps forward." 

Gelsinger said those developments instill confidence that technology — software and cloud, in particular — will be stronger than the overall economic climate. For VMware, specifically, many of its business units, such as Workspace ONE and Carbon Black, will be critical for businesses to operate in a world with a more distributed workforce, Gelsinger said. 

Shares of VMware were trading up more than 7% on Friday following its quarterly earnings report Thursday. It posted revenues of $2.73 billion, a 12% year-over-year increase, and $1.52 per share excluding some items. 

Gelsinger said VMware issued a "more modest view" of its upcoming quarters due to the new ways of doing business. "We have to generate those new projects," he said, but it requires "new muscles" in a remote-work environment. 

VMware, based in Palo Alto, California, had about 31,000 workers in 169 offices globally as of Jan. 31. Gelsinger said many of the company's smaller, satellite offices may close. But the Silicon Valley headquarters are still a part of the company's future plans. 

"This is going to move from being a hotel for offices to a collaboration hub. I expect our footprint here will largely stay the same, but we're going to redesign it quite significantly," he explained. "This is where we're going to gather to innovate, to build community, to reestablish culture and connections with people." 

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