Red Hat Net Surges On Growing Linux Subscription Revenue
Subscription revenue was $109.2 million in the second quarter, up 29% from a year ago and 6% over the previous quarter.
Red Hat net income surged as revenue continued to grow year over year in the second quarter ended Aug. 31, according to CFO Charlie Peters.
Revenue totaled $127.3 million, up 28% from the same quarter a year ago and up 7% from the first quarter. Subscription revenue was $109.2 million of the total, up 29% from a year ago and 6% over the previous quarter. The figures show a growing demand for Linux as a subscription service. Deferred revenue, part of which is still-to-be collected subscription commitments, amounted to $377 million, an increase of 33% over the year-ago period.
Net income for the quarter was $18.2 million, up 64% or 9 cents per share, compared with $11 million or 5 cents per share for the same quarter a year ago. The adjusted results were in line with earnings estimates on Wall Street, according to Thomson Financial. Red Hat shares, which had closed Monday at $19, were down slightly to $18.89 by the close of trading Tuesday.
Peters said he projects revenue of $131 million to $133 million in the third quarter of the fiscal year, with earnings of 18 cents per share, according to Reuters.
During the quarter, Red Hat released JBoss Enterprise Application Platform 4.2, its JBoss application server and middleware suite integrated for migrating legacy applications to an open source code operating environment.
It also released the beta version of an integrated set of Eclipse-based open source development tools, and certified its 3,000th application to run on Red Hat Linux.
Red Hat also announced Tuesday the appointment Mark Cook as VP of finance and controller. He was previously Red Hat's treasurer. Paul Argiry replaced Cook as the treasurer, joining Red Hat from the position of senior director of corporate finance at Jabil Circuit.
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