Alphabet Inc.'s Google [s:googl] [s:goog] on Tuesday denied that it was building customized appliances to compete with Nutanix Inc. (ntnx) in hyperconvergence, following a Monday report in the Information indicated that the company was working custom computers that combine server, storage, and networking. “We value our partnerships highly and can also confirm that we are not competing with our partners in this area.” Nutanix stock initially sold off after the report came out on Monday, but it rallied 4.5% in morning trade Tuesday. Several analysts dismissed the Google threat and reiterated their bullish views of Nutanix earlier in the morning.
I think the fact that Google would come out and deny competing with NTNX is significant. It is not something the big tech companies normally do. It tells me they do really value their partnership with NTNX, and is a big positive going forward.