Red Hat Posts Upbeat Q2 Results, Issues Strong Outlook

reported better-than-expected results for its second quarter and issued a strong forecast on Monday. The Raleigh, North Carolina-based company posted quarterly net income of $51.4 million, or $0.28 per share, compared to $46.8 million, or $0.25 per share, in the year-ago quarter. Excluding items, Red Hat earned $0.47 per share. Its revenue surged 13 percent to $504.1 million. However, analysts were expecting earnings of $0.44 per share on revenue of $494.65 million. Subscription revenue climbed 13 percent year-over-year to $442 million for the quarter. Subscription revenue in Infrastructure-related offerings gained 9 percent to $363 million. Operating cash flow for the second quarter surged 12 percent year-over-year to $120 million. "Strong execution in Q2 contributed to total revenue results that exceeded 21% year-over-year growth on a constant currency basis. We were pleased with the progress of our technologies that address cloud deployments across multiple footprints. Specifically in this quarter, we achieved a public cloud milestone in our Certified Cloud and Service Provider program of an annualized run-rate of $100 million." stated Jim Whitehurst, President and Chief Executive Officer of Red Hat. For the third quarter, Red Hat expects adjusted earnings of $0.47 per share on revenue of $519 million to $523 million. Analysts projected earnings of $0.46 per share on revenue of $513.6 million. Red Hat projects FY adjusted earnings of $1.85 to $1.87 per share on sales of $2.034 billion to $2.044 billion. Analysts expected earnings of $1.83 per share on revenue of 2.02 billion. Red Hat shares surged 0.94 percent to $73.40 in the after-hours trading session.