Feeds

Red Hat's pockets bulging on strong Linux, JBoss sales

Sights set on OpenStack

Reducing security risks from open source software

Enterprise Linux vendor Red Hat posted strong financial results for the third quarter of its fiscal 2014 on Thursday, with earnings that beat both analysts' estimates and the company's own earlier guidance.

Revenues for the quarter ending on November 30 were $397m, up 15 per cent from the same period a year ago.

In the customary conference call with financial analysts, Red Hat president and CEO Jim Whitehurst attributed the gains to strong demand both for the company's flagship Red Hat Enterprise Linux (RHEL) product and for its JBoss Middleware suite.

Of the total, $343m or 86.4 per cent of Red Hat's revenue this quarter came from subscriptions, which was up 17 per cent from the year-ago quarter.

Those healthy sales panned out in profits, with the company reporting net income of $52m, an increase of 48.6 per cent from Q3 of its fiscal 2013.

When adjusted for stock-based compensation and amortization, that meant earnings of $0.42 per diluted share, which not only beat the $0.29 per diluted share earnings of the year-ago quarter but also surprised the analysts, who were expecting results closer to $0.35 per share, according to Yahoo! Finance.

During the call, Whitehurst talked up Red Hat's investment in the OpenStack open-source cloud computing platform, which he said offers an alternative to proprietary software for customers who are transitioning their IT to hybrid cloud technologies. Red Hat plans to be "a big player" in OpenStack consulting, he said.

But although Whitehurst said Red Hat plans to continue to invest in OpenStack, he cautioned investors that it would take time for the company to build that part of its business, and that subscription revenues from OpenStack would be "modest" even in the fourth quarter.

Red Hat's overall revenues won't be, however, according to CFO Charlie Peters. During the earnings call, Peters said to expect the open source firm's fourth quarter revenues to match or exceed those of the third quarter, even given traditional seasonal declines.

All of this naturally came as music to the ears of Red Hat's investors, who sent the company's share price up more than 11 per cent in after-hours trading following Thursday's closing bell. ®

Mobile application security vulnerability report

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Nadella: Apps must run on ALL WINDOWS – PCs, slabs and mobes
Phone egg, meet desktop chicken - your mother
White? Male? You work in tech? Let us guess ... Twitter? We KNEW it!
Grim diversity numbers dumped alongside Facebook earnings
HP, Microsoft prove it again: Big Business doesn't create jobs
SMEs get lip service - what they need is dinner at the Club
ITC: Seagate and LSI can infringe Realtek patents because Realtek isn't in the US
Land of the (get off scot) free, when it's a foreign owner
Dude, you're getting a Dell – with BITCOIN: IT giant slurps cryptocash
1. Buy PC with Bitcoin. 2. Mine more coins. 3. Goto step 1
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
prev story

Whitepapers

Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Reducing security risks from open source software
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.