Nutanix Inc (NASDAQ: NTNX) had a rough day in the market yesterday as a story broke that Google could soon be creating its own cloud business that may compete with its partners. However, as the story broke, Google quickly walked back the news saying that they will not compete with their partners. This news sent the stock climbing in the market today. Below, we’ll talk about:
- Google’s comments with regard to competing with its private cloud business partners;
- what we’re seeing from NTNX stock as a result; and
- what we’ll be watching for ahead.
NTNX Heads Up On Google Comments
As mentioned above, Nutanix is having an incredibly strong start to the trading session this morning after Google said it would not be creating services that compete with it and other private cloud providers. Yesterday, news broke that Google cloud services could soon be reaching into the private cloud arena, leading to fear among investors in NTNX and other Google cloud partners.
However, today, the story is changing. First and foremost, a Google spokesperson explained late yesterday the company is building customized appliances, but argued that it was not competing with its partners in the private cloud business. In a statement, a spokesperson for Google had the following to offer:
We can confirm that we are not building customized appliances for external sale.
However, the spokesperson also said that these appliances will not compete with its partners in the private cloud business with the following:
We value our partnerships highly and can also confirm that we are not competing with our partners in this area.
So, while Google may be working on building customized appliances for external sale, NTNX and other private cloud partners of Google have little-to-nothing to worry about when it comes to competition stemming directly from the tech giant.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news causes moves. In the case of Nutanix, the news proved to be overwhelmingly positive. After all, fears of a competitor like Google entering the industry as competition have dissolved, and investors know that at least for the moment, the company is safe as one of the leaders in the space. So, it comes as no surprise that excited investors are sending the stock on a run for the top. Of course, our partners at Trade Ideas were the first to alert us to the gains. Currently (8:40), NTNX is trading at $49.28 per share after a gain of $2.85 per share or 6.14% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on NTNX. In particular, we’re interested in following the company’s continued growth as a leading provider in the private cloud business. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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