by CIO Staff

Red Hat Revenue Continues to Increase

Jun 29, 20062 mins
IT Leadership

Strong Linux sales drove Red Hat revenue up 38 percent in its fiscal 2007 first quarter, the company announced Wednesday.

Red Hat reported revenue of US$84 million for the quarter. Subscriptions were up 45 percent from the previous year’s quarter to $71.5 million.

GAAP net income for the quarter was $13.8 million, or $0.07 per share, compared with $12.4 million, or $0.07 per share, for the same period last year. But that comparison is skewed by new rules requiring the company to expense stock options, which hit income in the first quarter.

Red Hat earlier this month completed its $350 million acquisition of Java application server vendor JBoss. The deal, announced in April, surprised the IT industry, which at the time was swirling with rumors that Oracle was looking to buy JBoss. But for Red Hat, the move provided new momentum in its efforts to move up the stack beyond its Linux operating system roots. JBoss will operate as a division of Red Hat, with Marc Fleury, founder and former chief executive officer of JBoss, heading the division as senior vice president and general manager.

Red Hat rival Novell earlier this month delivered a disappointing outlook for its third quarter, ending in July. It forecast third-quarter revenue of $239 million to $247 million and earnings per share of $0.03, which was below Wall Street analysts’ expectations. And last week, Novell’s board of directors ousted the company’s chairman and chief executive officer, Jack Messman, and Chief Financial Officer Joseph Tibbetts in order to accelerate growth at the company.

-Shelley Solheim, IDG News Service (New York Bureau)

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