Red Hat delivered solid third-quarter results that topped Wall Street expectations. Red Hat CEO Jim Whitehurst said the company is enjoying strong demand and market share gains.
The open-source giant reported third-quarter earnings of US$38.2 million, or 19 cents a share, on revenue of US$290 million, up 23 per cent from a year ago. Non-GAAP earnings were 28 US cents a share in the third quarter. The company is expected to report third-quarter earnings of 26 US cents a share on revenue of US$289.6 million.
Subscription revenue in the third quarter was US$246.5 million, said Red Hat.
In a statement, Whitehurst said the company is enjoying strong demand and market share gains. Whitehurst said:
Red Hat continues to benefit from enterprise customers that are seeking to leverage their IT infrastructure to drive significant productivity gains and agility across their organisations.
Red Hat delivered deferred revenue of US$819.6 million, up 20 per cent from a year ago. Cash, cash equivalents and investments was US$1.2 billion.
An Evercore survey of Red Hat partners — integrators, resellers and the like — point to continued strength. Among the key data points:
- 67 per cent of Red Hat partners are expecting Red Hat Enterprise Linux sales to be strong in the year ahead. Specifically, 29 per cent of partners see sales up 0 to 10 per cent with 14 per cent projecting sales growth of 10 per cent to 20 per cent. Another 14 per cent expect sales growth of 20 per cent to 30 per cent.
- Migrations from Unix continue to drive Red Hat Enterprise Linux (RHEL) demand. Thirty-one per cent of partners say Unix migrations are driving growth with another 27 per cent citing current customers expanding their Red Hat spend.
- The jury is out on JBoss. Forty-five per cent of partners expected flat JBoss sales. A full 78 per cent of partners expected demand to remain the same.
- 52 per cent of partners see potential for Red Hat Enterprise Virtualisation. For the most part, partners are wait and see on Red Hat's virtualisation.
Via ZDNet US