Red Hat Grows by Taking Windows, UNIX Share
Red Hat Defies Expectations Again
Sean Michael Kerner
Wednesday, December 23, 2009 12:09:39 PM
Once again, Linux vendor Red Hat has beat expectations and defied the
gravity of a down economy.
Red Hat (NYSE: RHT) reported its third-quarter fiscal 2010 earning late
Tuesday for the quarter ending Nov. 30 with higher-than-expected revenues.
Executives attributed the continued growth of Red Hat to a number of
factors, including competitive wins and migrations against both Windows and
UNIX.
Red Hat beat analyst estimates and its own earlier guidance for the
quarter, reporting revenue of $194 million, which is an 18 percent
year-over-year increase, and before-charges earnings amounting to $0.17 per
share -- a penny short of non-GAAP earnings a year ago.
Wall Street analysts had projected revenues of $188 million and earnings
of $0.16 per share, according to Thomson Reuters. Red Hat itself provided
guidance in the $187-$189 million range during the company's second-quart
er fiscal 2010 analyst call.
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Net income for the quarter came in at $16.4 million, or $0.08 per share,
which is a decline from the $24.3 million Red Hat earned during the third
quarter of fiscal 2009. Part of the net income decline came as a result of a
legal settlement that Red Hat concluded during the quarter for a five-year-old class action
lawsuit.
Moving forward, Red Hat is remaining optimistic about its continued
growth prospect and provided revenue guidance of approximately $191 million
to $193 million.
"Throughout this economic downturn, we have continued to deliver solid
results because our value proposition to customers at present is superior to
that our competitors," Red Hat CEO Jim Whitehurst said during the company's
analyst call. "In addition, we continue to execute on our key initiatives
and are investing in growth areas that improve our strategic position in the
datacenter."
Next: Future Growth »
