Red Hat reported better-than-expected fourth quarter earnings Monday, as subscription revenues bolstered the company's bottom line.
The open-source software company reported a net income of $66 million, or 36 cents per share.
Non-GAAP earnings were 61 cents per share on a revenue of $629 million, up 16 percent year over year.
Wall Street was looking for earnings of 61 cents per share with $521 million in revenue.
Bolstering Red Hat's solid quarter was subscription revenue growth of 17 percent year over year to $619 million. The bulk of subscription revenue, approximately $435 million, came from infrastructure-related products, while application-development related technologies accounted for the rest.
"Our strategic position with customers is evidenced by the continued growth in large commitments to Red Hat," Red Hat CFO Eric Shander said. "The number of deals greater than $1 million in fiscal 2017 grew by over 30 percent annually, and we closed a record number of deals over $20 million, including our first-ever deal of approximately $100 million in the fourth quarter."
Red Hat also raised its fiscal 2017 revenue outlook and now expects adjusted earnings of $2.60 to $2.64 a share on revenue of $2.72 billion to $2.76 billion. Analysts on average are expecting $2.59 a share on revenue of $2.71 billion.
VIDEO: Munich to ditch €30m Linux installation?