WASHINGTON (dpa-AFX) - Linux software provider Red Hat Inc. (RHT), Thursday reported an increase in third-quarter profit, driven mostly by the continued growth in subscriptions. Results for the quarter trumped Wall Street estimates.
The announcement cheered investors with Red Hat shares jumping 9 percent in after-hours trade on the New York Stock Exchange.
'Strong demand in Q3 for our core Red Hat Enterprise Linux and JBoss Middleware technologies led to results that exceeded guidance across several key financial metrics,' said CEO Jim Whitehurst.
Notwithstanding the soft economic conditions, Red Hat has been gaining from buoyant demand for its RHEL server virtualization offering and JBoss middleware product. The company earlier indicated adding infrastructure-as-a-service, Red Hat Enterprise Linux OpenStack Platform, to its portfolio of cloud offerings.
Red Hat, based in Raleigh, North Carolina, posted third-quarter net income of $52 million or $0.27 per share, up from $35 million or $0.18 per share last year.
Excluding items, adjusted earnings for the quarter were $81 million or $0.42 per share, compared with $57 million or $0.29 per share a year ago.
On average, 32 analysts polled by Thomson Reuters expected earnings of $0.35 per share for the quarter. Analysts' estimates typically exclude special items.
Revenue for the third quarter grew 15 percent to $397 million from $344 million in the prior year. Twenty-eight analysts had a consensus revenue estimate of $383.11 million for the quarter.
Red Hat's subscription revenue climbed 17 percent.
The company also benefited after income tax expense dropped to $10 million from $16 million a year ago. However, operating expenses climbed to $275 million from $241 million last year, on higher research and selling costs.
Red Hat stock closed Thursday at $48.97, up $0.06 or 0.12%, on a volume of 1.9 million shares. In after hours, the stock gained $4.72 or 9.64%, at $53.69. In the past year, the stock has traded in the range of $41.89 - $57.10.
Copyright RTT News/dpa-AFX
© 2013 AFX News
