VMWare treats each core as a physical CPU. So two processors, each with 2 cores, would be treated by VMWare as four physical CPUs.

The user of VMWare hypervisors creates virtual CPUs (vCPUs) as part of their VM configuration. Any configuration is possible. Suppose the user creates two VMs. They may choose to configure 2 vCPUs for each, or 1 vCPU for one and 3 vCPUs for the other. Furthermore, they might choose to configure 1 vCPU for each, thus wasting the resources of 2 physical CPUs. They might also allocate 4 vCPUs to each. In this case, the VMM will handle scheduling as 4 physical CPUs are multiplexed across 8 vCPUs.

See VMWare's web site for product documentation and white papers.