Bare metal cloud servers now cheaper and more readily available than on-prem hardware, says Nutanix CEO
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Virtualization
Bare metal cloud servers now cheaper and more readily available than on-prem hardware, says Nutanix CEO Hyperscalers can get hardware before enterprise vendors and buyers don't much care where they land
Simon Sharwood Simon Sharwood
APAC Editor
Published thu 28 May 2026 // 02:59 UTC
Hyperscalers’ purchasing power means bare metal servers offered by major clouds can now be cheaper and easier to acquire than on-prem servers, according to Nutanix CEO Rajiv Ramaswami.The CEO told The Register hyperscalers’ ability to buy servers and memory in bulk means they can often make infrastructure available faster than enterprise hardware players, and sees some customers who have previously preferred on-premises infrastructure heading for the cloud.Ramaswami said he expects high memory and solid state storage prices will persist into next year and noted the impact of current price rises on the cost of servers.
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“What that means for customers is they need to plan and budget carefully,” he said. “They pick servers on price and lead time” – and clouds often win on both metrics.
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At the same time, Ramaswami said customers increasingly favor on-prem AI infrastructure to keep costs predictable. They want that because the CEO thinks AI remains “one of those things where people feel they have to do it” and return on investment is unclear. MORE CONTEXT Broadcom finds a VMware customer willing to stick around: London Stock Exchange
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“People are seeing incremental benefits,” he said, citing document search and summaries as the most common on-prem AI applications. Nutanix, he said, has measured a ten-percent improvement in service response times from using AI, while its developers are delivering new features 50 percent faster than before they used AI helpers.Enterprise virtualization stacks like Nutanix’s products can require several hefty hosts to run. Ramaswami said he’s comfortable the footprint of his company’s products is not an issue for new buyers, but that he is also keenly aware that customers are looking for smaller hosts – and even servers running non-x86 processors.For now, he doesn’t see sufficient appetite for Arm servers that Nutanix will devote developer time to porting its stack to that platform. But if demand comes, Ramaswami is confident it won’t be a major job as FOSS projects the company relies on – such as Kubernetes and the KVM hypervisor – already run on Arm silicon.The CEO’s remarks came on the same day Nutanix reported its Q3 2026 results, which included news that the company won 730 new clients in the last quarter with Ramaswami saying “most moved from legacy vendors to us.”That’s almost certainly a reference to VMware. Whether Nutanix is hurting its rival remains to be seen: pre-acquisition VMware had over 350,000 customers and now focuses on the top 10,000. Nutanix can pick up former Virtzilla users without disrupting Broadcom’s master plan.Ramaswami said many new customers have taken advantage of Nutanix’s shift to allow use of external storage, a change from its previous insistence on using only its own software-defined storage. The CEO said the company scored a pair of seven-figure deals with companies that chose to continue using external storage from Everpure (formerly Pure Storage) and Dell, respectively.Q3 revenue was $703 million, a ten percent year on year jump. Nutanix has always preferred to emphasize annual recurring revenue as a metric, and that rose 15 percent year over year to $2.43 billion.
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Investors liked what they heard, sending Nutanix’s share price up a couple of points in after hours trading. ®
kubernetes nutanix cloud computing arm bare metal virtualization vmware
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