- William Blair says that work-from-home tech infrastructure has become the "toilet paper of IT spending" during the coronavirus crisis.
- The analyst report was based on a survey of resellers who pointed to "virtually frozen pipelines" in general.
- The only tech companies seeing any increased demand are those that play a critical role in helping businesses manage a remote workforce, including Microsoft, Citrix, VMware and Dropbox.
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As the COVID-19 crisis pummels the sales of tech gear and systems, work-from-home tech has emerged as the "toilet paper of IT spending," according to investment firm William Blair, based on its quarterly survey of enterprise tech resellers.
While those resellers point to a "stark reality" of "virtually frozen pipelines," they're still seeing demand for communications tools, cloud platforms, and the infrastructure that's helping businesses manage a remote workforce.
Resellers "overwhelmingly cited a mad rush to acquire tools and technologies that enable work-from-home operations, as IT departments scrambled to deploy remote access capabilities across their entire organizations," analyst Jason Ader wrote in a note to clients, in the same way that people dashed out to buy toilet paper as the coronavirus panic cleared shelves.
Microsoft, Citrix, VMware and Dropbox are seeing the most demand, the survey showed.
Microsoft has its Teams communications platform as well as its dominant cloud software, VMware and Citrix are providing easy access to networks, and Dropbox, the cloud storage platform, is making it easier for homebound employees to manage data. This trend has actually led to the rise of a new Wall Street category: work-from-home stocks.
Tech companies that sell to governments and telecommunications companies are also poised to do well, as governments are spending more to respond to the crisis and telecommunications companies have had to meet increased workloads on their networks.
These are trends that are bound to give Microsoft, VMware and Citrix a lift, resellers told William Blair.
Two key markets are taking a beating as a result of the crash, though.
One is hardware used to set up and maintain private data centers. This was already a shrinking market as businesses moved to the cloud, allowing them to scale down or abandon in-house data centers. That trend is picking up steam in the crisis.
Companies that rely heavily on small businesses, which are taking the biggest hit in the crash, are also vulnerable, according to William Blair.
"This is leading to a bleak outlook for infrastructure spending in the calendar second quarter and enormous uncertainty for the full year," the note said, "Though many (resellers) are optimistic in a modest recovery before year-end."
Got a tip about Microsoft, Citrix, VMware, Dropbox or another tech company? Contact this reporter via email at bpimentel@businessinsider.com, message him on Twitter @benpimentel or send him a secure message through Signal at (510) 731-8429. You can also contact Business Insider securely via SecureDrop.