Red Hat SummitRevenue for the first quarter of fiscal 2005 was $41.6 million, a sequential increase of 13% compared to $37.0 million in the fourth quarter of fiscal 2004, and a year-over-year increase of 53%.
For the first quarter of fiscal 2005, the company reported net income of $10.7 million, or $0.05 per share. This represents an increase of 113% over net income of $5.0 million, or $0.03 per share, in the prior quarter, and an increase of 603% over net income in the same quarter a year ago.
The company generated $30.1 million, or $0.16 per share, in positive cash flow from operations during the first quarter. The company ended the quarter with a cash and investments balance of $964.4 million.
In the first quarter of fiscal 2005, the company increased its deferred revenue balance to $86.1 million, a sequential increase of $15.2 million, or 21%, as compared to the fourth quarter of fiscal 2004.
Highlights for the first quarter include:
- Sales of subscriptions to Red Hat Enterprise Linux continued to outpace the growth rate of the Intel-based server market, reaching 98,000 subscriptions in the first quarter, a sequential increase of 13%. This is comprised of 75,000 subscriptions sold into the enterprise IT market and 23,000 subscriptions sold into the HPC and hosting markets.
- Renewal rates for subscriptions sold to Red Hat Enterprise Linux in prior years remained strong at approximately 85%.
- Gross margins increased to record levels, with blended gross margins at 80% and gross margins of Enterprise subscription technologies at 93%.
- Operating profit, excluding stock-based compensation, increased to $6.5 million, or 16% of total revenue. This represents a sequential increase of 43% on an adjusted basis and 93% on a GAAP basis, as compared to the fourth quarter of fiscal 2004.
"Red Hat continued to show consistent execution in the first quarter of fiscal 2005, as evidenced by a strong sequential growth in subscription volumes, gross margins, and operating margins", stated Kevin Thompson, Executive Vice President and Chief Financial Officer. "Cash flow from operations once again remained strong, representing 72% of total revenues in the quarter".
About Red Hat, Inc.
Red Hat, the world's leading open source and Linux provider, is headquartered in Raleigh, NC with satellite offices spanning the globe. Red Hat is leading Linux and open source solutions into the mainstream by making high quality, low cost technology accessible. Red Hat provides operating system software along with middleware, applications and management solutions. Red Hat also offers support, training and consulting services to its customers worldwide and through top-tier partnerships. Red Hat's open source strategy offers customers a long term plan for building infrastructures that are based on and leverage open source technologies with focus on security and ease of management. Learn more: http://www.redhat.com
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- About Red Hat
Red Hat is the world’s leading provider of open source software solutions, using a community-powered approach to reliable and high-performing cloud, Linux, middleware, storage and virtualization technologies. Red Hat also offers award-winning support, training, and consulting services. As the connective hub in a global network of enterprises, partners, and open source communities, Red Hat helps create relevant, innovative technologies that liberate resources for growth and prepare customers for the future of IT. Learn more at http://www.redhat.com.
- Forward-Looking Statements
Certain statements contained in this press release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: risks related to delays or reductions in information technology spending; the effects of industry consolidation; the ability of the Company to compete effectively; the integration of acquisitions and the ability to market successfully acquired technologies and products; uncertainty and adverse results in litigation and related settlements; the inability to adequately protect Company intellectual property and the potential for infringement or breach of license claims of or relating to third party intellectual property; the ability to deliver and stimulate demand for new products and technological innovations on a timely basis; risks related to data and information security vulnerabilities; ineffective management of, and control over, the Company’s growth and international operations; fluctuations in exchange rates; and changes in and a dependence on key personnel, as well as other factors contained in our most recent Quarterly Report on Form 10-Q (copies of which may be accessed through the Securities and Exchange Commission’s website at http://www.sec.gov), including those found therein under the captions "Risk Factors" and "Management’s Discussion and Analysis of Financial Condition and Results of Operations". In addition to these factors, actual future performance, outcomes, and results may differ materially because of more general factors including (without limitation) general industry and market conditions and growth rates, economic and political conditions, governmental and public policy changes and the impact of natural disasters such as earthquakes and floods. The forward-looking statements included in this press release represent the Company’s views as of the date of this press release and these views could change. However, while the Company may elect to update these forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date of this press release.
