Red Hat published fourth quarter and year-end financial results after the bell on Wednesday.
The open source purveyor posted a net income of $48 million, or 26 cents per share (statement).
Non-GAAP earnings were 43 cents per share on a revenue of $464 million, up 16 percent year-over-year.
Wall Street was looking for earnings of 41 cents per share on a revenue of $456.50 million.
For the full year, Red Hat earned $1.79 billion in revenue, up 17 percent year-over-year.
Subscription revenue for the fourth quarter was $405 million, up 15 percent in U.S. dollars year-over-year, or 21 percent in constant currency.
Red Hat CEO and president Jim Whitehurst credited the company's strategy and shift toward open hybrid cloud technologies.
"Customers value the consistency and flexibility as they run their applications using Red Hat solutions across a variety of deployment models, including public and private clouds, to modernize and transform their IT infrastructure," wrote Whitehurst. "We believe that our strategic position as a trusted provider of infrastructure and our execution this past year have positioned us for strong constant currency revenue growth in the next fiscal year."
The Raleigh, N.C.-headquartered company also announced a new $500 million stock buyback program on Wednesday afternoon, replacing the previous $300 million repurchase program.
The latter is scheduled to expire on March 31, 2015. Approximately $220 million was used under that plan as of today, March 25.
Red Hat had approximately 183.5 million shares of common stock outstanding as of February 28.
Red Hat's chief financial officer Charlie Peters noted in the report that the company has already repurchased over $1 billion (roughly 19.5 million shares) of Red Hat common stock over the last four years.
In reflection of the better-than-expected earnings and the buyback program, Red Hat shares were up approximately 5.2 percent shortly after the report hit the wires during after-hours trading.
Looking forward to the first quarter, analysts expect Red Hat to end the first quarter with $475.55 million in revenue and earnings of 41 cents per share.