2Q08 VMware numbers announced. The good: international and service revenue are way up. The not as good: The Street is always looking for more.Total revenue for the second quarter was $456 million, up 54% from the second quarter of 2007. Financial analysts were hoping for a bit more.

I say not so bad, especially with a 68% growth in international revenue ($216M, up by 68% vs. 2Q07, driven by success in Europe and Australia.) Looks like initiatives this year on both fronts have been paying off. Frankly, numbers are better than I expected.

Domestic revenue grew 43%, to $240M, compared with last year.

Service revenue was up 85%, bringing in $172M, while software license revenue grew 39% to $284 million from 2Q07.

GAAP net income for the quarter was $52 million, or $0.13 per diluted share, compared with $34 million, or $0.10 per diluted share, for the second quarter of 2007.

Non-GAAP net income for the quarter was $92 million, or $0.23 per diluted share, compared with $52 million, or $0.16 per diluted share, for the second quarter of 2007.

Cold cash exceeded $1.5 billion and deferred revenue was $721 million as of end of the quarter, June 30, 2008.

Other news: Product announced from the Thinstall acquisition -- general availability of ThinApp 4, an app virt offering that lets customers run multiple versions of most applications on any Windows operating system without conflict.

In a move to simplify the customer options and help ease management and provisioning of VMs, general availability also was announced for a data center management bundle -- VMware Lifecycle Manager, VMware Lab Manager, and VMware Stage Manager provide cradle-to-grave SW life cycle control.

OEM news: agreements with Lenovo and Inspur announced to bundle and market Infrastructure 3 in China, and Dell is delivering a new line of PowerEdge servers and blades with ESXi embedded.

Good news, bad news: VMware is managing expectations for year-over-year growth. The forecast: modestly below previous estimates of 50%, more likely in the low-to-mid forties. The next two quarters may be too quick to tell if Hyper-V or any of the many open source server virt offerings make a dent in VMware revenue; the next half year also will reveal if domestic jitters on the economy lead to canceled orders or deferred investment in virtualization projects.2Q08 VMware numbers announced. The good: international and service revenue are up. The not as good: the street is always looking for more.