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Red Hat Reports Fourth Quarter and Fiscal Year 2016 Results

RALEIGH, N.C -

Red Hat, Inc. (NYSE: RHT), the world's leading provider of open source solutions, today announced financial results for its fiscal fourth quarter and fiscal year ended February 29, 2016.

Customers are demanding technologies that modernize the development, deployment and life-cycle management of applications across hybrid cloud environments. Many are relying on Red Hat to provide both the infrastructure and the application development platforms to run their enterprise applications consistently and reliably across physical, virtual, private cloud and public cloud environments.

Jim Whitehurst
president and CEO

“The fourth quarter was a strong close to the year as our results exceeded our guidance. We maintained a high level of execution throughout the fiscal year which contributed to greater than 20% constant currency revenue growth in each quarter. This performance also drove a record backlog of $2.13 billion in U.S. dollars, up 15% year-over-year, and provides us meaningful visibility into future revenue,” stated Frank Calderoni, Executive Vice President, Operations and Chief Financial Officer of Red Hat. “Our business momentum also drove record annual cash flow of $716 million, up 15% and representing the 5th straight year of operating cash flow margin of approximately 35%.”Enterprises increasingly adopting hybrid cloud infrastructures and open source technologies drove our strong results. The fourth quarter marked our 56thconsecutive quarter of revenue growth, contributing to Red Hat’s first fiscal year crossing $2 billion in total revenue,” stated Jim Whitehurst, President and Chief Executive Officer of Red Hat. “Customers are demanding technologies that modernize the development, deployment and life-cycle management of applications across hybrid cloud environments. Many are relying on Red Hat to provide both the infrastructure and the application development platforms to run their enterprise applications consistently and reliably across physical, virtual, private cloud and public cloud environments.”

Revenue: Total revenue for the quarter was $544 million, up 17% in U.S. dollars year-over-year, or 21% measured in constant currency. Constant currency references in this release are detailed in the tables below. Subscription revenue for the quarter was $480 million, up 18% in U.S. dollars year-over-year, or 22% measured in constant currency. Subscription revenue in the quarter was 88% of total revenue.

Full fiscal year 2016 total revenue was $2.05 billion, up 15% in U.S. dollars year-over-year, or 21% measured in constant currency. Subscription revenue for the full fiscal year was $1.80 billion, up 16% in U.S. dollars year-over-year, or 22% measured in constant currency. Subscription revenue in the full fiscal year was 88% of total revenue.

Subscription Revenue Breakout: Subscription revenue from Infrastructure-related offerings for the quarter was $391 million, an increase of 15% in U.S. dollars year-over-year and 18% measured in constant currency. Subscription revenue from Application Development-related and other emerging technologies offerings for the quarter was $89 million, an increase of 38% in U.S. dollars year-over-year and 43% measured in constant currency.

Full fiscal year subscription revenue from Infrastructure-related offerings was $1.48 billion, an increase of 12% in U.S. dollars year-over-year and 18% measured in constant currency. Full fiscal year subscription revenue from Application Development-related and other emerging technologies offerings was $323 million, an increase of 37% in U.S. dollars year-over-year and 46% measured in constant currency.

Operating Income: GAAP operating income for the quarter was $72 million, up 6% year-over-year. After adjusting for non-cash share-based compensation expense, amortization of intangible assets and transaction costs related to business combinations, non-GAAP operating income for the fourth quarter was $124 million, up 13% year-over-year. Non-GAAP references in this release are detailed in the tables below. For the fourth quarter, GAAP operating margin was 13.2% and non-GAAP operating margin was 22.9%.

Full fiscal year GAAP operating income was $288 million, up 15% year-over-year. After adjusting for non-cash share-based compensation expense, amortization of intangible assets and transaction costs related to business combinations, non-GAAP operating income for the full fiscal year was $484 million, up 16% year-over-year. Full fiscal year GAAP operating margin was 14.0% and non-GAAP operating margin was 23.6%.

Net Income: GAAP net income for the quarter was $53 million, or $0.29 per diluted share, compared with $48 million, or $0.26 per diluted share, in the year-ago quarter. After adjusting for non-cash share-based compensation expense, amortization of intangible assets, transaction costs related to business combinations, and non-cash interest expense related to the convertible debt discount, non-GAAP net income for the quarter was $97 million, or $0.52 per diluted share, as compared to $81 million, or $0.43 per diluted share, in the year-ago quarter. Non-GAAP diluted weighted average shares outstanding excludes any dilution resulting from the convertible notes because any potential dilution is expected to be offset by our convertible note hedge transactions. Fourth quarter GAAP EPS included an approximately $0.02 benefit while non-GAAP EPS included an approximately $0.04 benefit associated with a discrete tax item recorded in the quarter.

Full fiscal year GAAP net income was $199 million, or $1.07 per diluted share, compared with $180 million, or $0.95 per diluted share, in the prior fiscal year. After adjusting for non-cash share-based compensation expense, amortization of intangible assets, transaction costs related to business combinations, and non-cash interest expense related to the convertible debt discount, non-GAAP net income for the full fiscal year was $355 million, or $1.91 per diluted share, as compared to $303 million, or $1.60 per diluted share, in the prior fiscal year.

Cash: Operating cash flow was $247 million for the fourth quarter, an increase of 14% on a year-over-year basis. Operating cash flow for the full fiscal year was $716, an increase of 15% compared to the prior fiscal year.

Total cash, cash equivalents and investments as of February 29, 2016 was $2.0 billion after repurchasing approximately $114 million, or approximately 1.6 million shares, of common stock in the fourth quarter. After repurchasing approximately $263 million, or approximately 3.5 million shares, of common stock for the full fiscal year, the remaining balance in the current repurchase authorization as of February 29, 2016 was approximately $237 million.

Deferred revenue and backlog: Total backlog for fiscal year 2016 was in excess of $2.13 billion, up 15% year-over-year. We define total backlog as the value of non-cancellable subscription and service agreements, including total deferred revenue, which is billed, plus the value of non-cancellable subscription and service agreements to be billed in the future not reflected in our financial statements. At the end of the fiscal year, the company’s total deferred revenue balance was $1.72 billion, an increase of 16% year-over-year. The full year negative impact to total deferred revenue from changes in foreign exchange rates was $21 million year-over-year. On a constant currency basis, total deferred revenue would have been up 18% year-over-year. The portion of total backlog to be billed in the future not reflected in our financial statements was in excess of $410 million as of February 29, 2016, compared with the ending balance in excess of $380 million reported for fiscal year 2015. The portion of total backlog to be billed during fiscal year 2017 was in excess of $275 million as of February 29, 2016, compared with in excess of $230 million for the fiscal year ending February 28, 2015.

Outlook: Red Hat’s outlook assumes current business conditions and foreign currency exchange rates. For the full year:

  • Revenue guidance is expected to be $2.380 billion to $2.420 billion in U.S. dollars.
  • Full year GAAP operating margin is expected to be approximately 14.4% and non-GAAP operating margin is expected to be approximately 23.2%.
  • Full year fully-diluted GAAP earnings per share (EPS) is expected to be approximately $1.30 to $1.34 per share. Full year fully-diluted non-GAAP EPS is expected to be approximately $2.22 to $2.26 per share. Both GAAP and non-GAAP EPS assume a $1 million to $2 million per quarter forecast for other income, a 27% annual effective tax rate and 184 million fully-diluted shares outstanding.
  • Operating cash flow guidance range is expected to be approximately $800 million to $820 million.

For the first quarter:

  • Revenue guidance is $558 million to $566 million.
  • GAAP operating margin is expected to be approximately 13.2% and non-GAAP operating margin is expected to be approximately 22.0%.
  • Fully-diluted GAAP EPS is expected to be approximately $0.28 per share. Fully-diluted non-GAAP EPS is expected to be approximately $0.50.

GAAP to non-GAAP reconciliation:

Full year non-GAAP operating margin guidance is derived by subtracting the estimated full year impact of non-cash share-based compensation expense of approximately $180 million and amortization of intangible assets of approximately $29 million. Full year fully-diluted non-GAAP EPS guidance is derived by subtracting the expenses listed in the previous sentence and the full year impact of non-cash interest expense related to the convertible debt discount of approximately $19 million.

First quarter non-GAAP operating margin guidance is derived by subtracting the estimated impact of non-cash share-based compensation expense of approximately $41 million and amortization of intangible assets of approximately $8 million. First quarter fully-diluted non-GAAP EPS guidance is derived by subtracting the expenses listed in the previous sentence and non-cash interest expense related to the convertible debt discount of approximately $5 million.

These statements are forward-looking and actual results may differ materially. Refer to the Forward-Looking Statements below for information on certain factors that could cause our actual results to differ materially.

Webcast and Website Information

A live webcast of Red Hat's results will begin at 5:00 pm ET today. The webcast, in addition to a copy of our prepared remarks and slides containing financial highlights and supplemental metrics, can be accessed by the general public at Red Hat's investor relations website athttp://investors.redhat.com. A replay of the webcast will be available shortly after the live event has ended. Additional information on Red Hat's reported results, including a reconciliation of the non-GAAP adjusted results, are included in the financial tables below.

   
RED HAT, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands - except per share amounts)
                   
                   
         Three Months Ended  Twelve Months Ended
         February 29,  February 28,  February 29,  February 28,
         2016  2015  2016  2015 (1)
Revenue:            
                   
 Subscriptions  $479,642  $405,073  $1,803,449  $1,561,234
 Training and services  63,860  58,869  248,781  228,255
                   
                   
  Total subscription, training and services revenue  543,502  463,942  2,052,230  1,789,489
                   
Cost of revenue:            
                   
 Subscriptions  33,575  28,731  126,663  112,856
 Training and services  47,645  41,487  182,966  160,343
                   
                   
  Total cost of subscription, training and services revenue  81,220  70,218  309,629  273,199
                   
                   
 Total gross profit  462,282  393,724  1,742,601  1,516,290
                   
Operating expense:            
 Sales and marketing  229,193  189,811  848,950  728,387
 Research and development  108,498  92,038  413,322  367,856
 General and administrative  52,819  44,267  192,281  170,053
                   
                   
  Total operating expense  390,510  326,116  1,454,553  1,266,296
                   
Income from operations  71,772  67,608  288,048  249,994
 Interest income  3,189  2,288  11,673  8,336
 Interest expense  5,856  5,803  23,121  9,394
 Other income (expense), net  (337)  4,784  (1,735)  6,562
                   
                   
Income before provision for income taxes  68,768  68,877  274,865  255,498
Provision for income taxes  15,732  21,177  75,500  75,297
                   
Net income  $53,036  $47,700  $199,365  $180,201
                   
Net income per share:            
 Basic   $0.29  $0.26  $1.09  $0.97
 Diluted   $0.29  $0.26  $1.07  $0.95
                   
Weighted average shares outstanding:            
 Basic   182,099  183,459  182,817  186,529
 Diluted   184,888  186,307  186,119  189,246
                   
                   
   (1) Derived from audited financial statements            
                
 

 

RED HAT, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
(In thousands)
            
ASSETS
        February 29,  February 28,
        2016  2015 (1)
            
Current assets:     
 Cash and cash equivalents$927,778  $1,047,473
 Investments in debt and equity securities281,142  215,254
 Accounts receivable, net509,715  468,021
 Prepaid expenses150,877  150,715
 Other current assets2,921  1,980
            
   Total current assets1,872,433  1,883,443
            
 Property and equipment, net166,886  172,151
 Goodwill   1,027,277  927,060
 Identifiable intangibles, net146,071  134,276
 Investments in debt securities786,470  546,016
 Deferred tax assets, net111,456  98,892
 Other assets, net44,506  22,731
            
   Total assets$4,155,099  $3,784,569
            
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:    
 Accounts payable and accrued expenses$284,802  $237,733
 Deferred revenue1,272,908  1,095,115
 Other current obligations1,467  1,185
            
   Total current liabilities1,559,177  1,334,033
            
 Convertible notes723,942  702,939
 Long term deferred revenue449,636  387,213
 Other long term obligations87,912  72,046
Stockholders' equity:    
 Common stock23  23
 Additional paid-in capital2,162,264  1,963,851
 Retained earnings1,099,738  900,373
 Treasury stock, at cost(1,853,144)  (1,515,288)
 Accumulated other comprehensive loss(74,449)  (60,621)
            
   Total stockholders' equity1,334,432  1,288,338
            
   Total liabilities and stockholders' equity$4,155,099  $3,784,569
            
            
   (1) Derived from audited financial statements    
        
 

 

RED HAT, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

            
            
       Three Months Ended  Twelve Months Ended
       February 29, February 28, February 29,  February 28,
       2016  2015  2016  2015 (1)
                 
Cash flows from operating activities:          
Net income$53,036  $47,700  $199,365  $180,201
Adjustments to reconcile net income to net cash provided by          
operating activities:          
 Depreciation and amortization19,144  19,149  76,088  76,263
 Share-based compensation expense45,768  36,290  166,234  135,232
 Deferred income taxes(17,585)  20,392  (13,673)  23,517
 Net amortization of bond premium on available-for-sale debt securities3,378  2,349  12,169  9,314
 Accretion of debt discount and amortization of debt issuance costs5,306  5,142  21,003  8,227
 Other 1,657  (2,947)  4,418  (3,474)
Changes in operating assets and liabilities net of effects of acquisitions:         
 Accounts receivable(112,919)  (123,850)  (48,404)  (121,536)
 Prepaid expenses(28,104)  (27,239)  (24,486)  (40,741)
 Accounts payable and accrued expenses58,484  14,865  62,438  71,040
 Deferred revenue220,410  224,738  260,495  282,693
 Other (1,122)  795  445  2,059
                 
  Net cash provided by operating activities247,453  217,384  716,092  622,795
                 
Cash flows from investing activities:          
 Purchase of available-for-sale debt securities(199,367)  (107,482)  (982,935)  (568,551)
 Proceeds from sales and maturities of available-for-sale debt securities66,491  77,048  655,622  580,158
 Acquisition of businesses, net of cash acquired252  -  (126,459)  (296,121)
 Purchase of other intangible assets(5,870)  (2,212)  (13,964)  (6,123)
 Purchase of property and equipment(12,095)  (10,563)  (41,553)  (45,648)
 Other 430  8,365  (2,819)  11,282
                 
  Net cash used in investing activities(150,159)  (34,844)  (512,108)  (325,003)
                 
Cash flows from financing activities:          
 Excess tax benefits from share-based payment arrangements2,244  710  20,231  5,607
 Proceeds from exercise of common stock options284  1,280  3,596  2,434
 Purchase of treasury stock(114,392)  -  (262,643)  (535,062)
 Payments related to net settlement of employee share-based compensation awards(6,091)  (4,148)  (66,907)  (43,462)
 Proceeds from issuance of convertible notes, net of issuance costs-  (625)  -  789,769
 Purchase of convertible note hedges-  -  -  (148,040)
 Proceeds from issuance of warrants-  -  -  79,776
 Payments on other borrowings(491)  (390)  (1,843)  (2,782)
                 
  Net cash provided by (used in) financing activities(118,446)  (3,173)  (307,566)  148,240
                 
 Effect of foreign currency exchange rates on cash and cash equivalents6,893  (15,883)  (16,113)  (45,301)
 Net increase (decrease) in cash and cash equivalents(14,259)  163,484  (119,695)  400,731
 Cash and cash equivalents at beginning of the period942,037  883,989  1,047,473  646,742
                 
Cash and cash equivalents at end of period$927,778  $1,047,473  $927,778  $1,047,473
                 
                 
   (1) Derived from audited financial statements          
              
 

 

RED HAT, INC.
RECONCILIATION OF CERTAIN GAAP RESULTS TO NON-GAAP ADJUSTED RESULTS
(Unaudited)
(In thousands - except per share amounts)
                 
                 
Non cash share-based compensation expense included in Consolidated Statements of Operations:    
                 
       Three Months Ended  Twelve Months Ended
       February 29,February 28,  February 29,  February 28,
       2016  2015  2016  2015
                 
 Cost of revenue$3,946  $3,569  $15,898  $14,027
 Sales and marketing19,703  15,408  69,089  55,203
 Research and development12,511  10,426  48,466  38,517
 General and administration9,608  6,887  32,781  27,485
 Total share-based compensation expense$45,768  $36,290  $166,234  $135,232
                 
                 
Amortization of intangible assets expense included in Consolidated Statements of Operations:    
                 
       Three Months Ended  Twelve Months Ended
       February 29,February 28,  February 29,  February 28,
       2016  2015  2016  2015
                 
 Cost of revenue$3,434  $2,576  $11,726  $10,672
 Sales and marketing1,730  2,305  8,075  7,838
 Research and development(13)  250  842  2,417
 General and administration1,711  1,484  5,160  5,958
 Total amortization of intangible assets expense$6,862  $6,615  $25,803  $26,885
                 
                 

Non-cash interest expense related to the debt discount included in Consolidated Statements of Operations:

    
                 
       Three Months Ended  Twelve Months Ended
       February 29,February 28,  February 29,  February 28,
       2016  2015  2016  2015
                 
 

Total non-cash interest expense related to the debt discount

$4,686  $4,556  $18,570  $7,292
                 
Transaction costs related to business combinations included in Consolidated Statements of Operations:    
                 
       Three Months Ended  Twelve Months Ended
       February 29,February 28,  February 29,  February 28,
       2016  2015  2016  2015
                 
 Transaction costs related to business combinations$40  -  $3,884  4,001
                 
                 
       Three Months Ended  Twelve Months Ended
       February 29,February 28,  February 29,  February 28,
       2016  2015  2016  2015
                 
GAAP net income$53,036  $47,700  $199,365  $180,201
                 
Provision for income taxes15,732  21,177  75,500  75,297
                 
GAAP income before provision for income taxes$68,768  $68,877  $274,865  $255,498
                 
Add: Non-cash share-based compensation expense45,768  36,290  166,234  135,232
Add: Amortization of intangible assets6,862  6,615  25,803  26,885

Add: Non-cash interest expense related to the debt discount

4,686  4,556  18,570  7,292
Add: Transaction costs related to business combinations40  -  3,884  4,001
                 
Non-GAAP adjusted income before provision for income taxes$126,124  $116,338  $489,356  $428,908
                 
Provision for income taxes (1)29,094  35,754  134,431  126,399
                 
Non-GAAP adjusted net income (basic and diluted)$97,030  $80,584  $354,925  $302,509
                 
Non-GAAP adjusted diluted weighted average shares outstanding:      
 GAAP diluted weighted average shares outstanding184,888  186,307  186,119  189,246
 Dilution offset from convertible note hedge transactions(67)  -  (282)  -
 Non-GAAP diluted weighted average shares outstanding184,821  186,307  185,837  189,246
                 
Non-GAAP adjusted net income per share:          
 Basic$0.53  $0.44  $1.94  $1.62
 Diluted$0.52  $0.43  $1.91  $1.60
                 
                 
(1) Provision for income taxes:          
Non-GAAP adjusted net income before income tax provision$126,124  $116,338  $489,356  $428,908
 Estimated annual effective tax rate23.1%  30.7%  27.5%  29.5%
Provision for income taxes on Non-GAAP adjusted net income$29,094  $35,754  $134,431  $126,399
           
 

 

RED HAT, INC.

RECONCILIATION OF CERTAIN GAAP RESULTS TO NON-GAAP ADJUSTED RESULTS

(Unaudited)

(In thousands - except per share amounts)

                 
                 
                 
Reconciliation of GAAP results to non-GAAP adjusted results          
                 
       Three Months Ended  Twelve Months Ended
       February 29, February 28, February 29,  February 28,
       2016  2015  2016  2015
                 
GAAP gross profit$462,282  $393,724  $1,742,601  $1,516,290
                 
Add: Non-cash share-based compensation expense3,946  3,569  15,898  14,027
Add: Amortization of intangible assets3,434  2,576  11,726  10,672
                 
Non-GAAP gross profit$469,662  $399,869  $1,770,225  $1,540,989
                 
Non-GAAP gross margin86.4%  86.2%  86.3%  86.1%
                 
                 
       Three Months Ended  Twelve Months Ended
       February 29, February 28, February 29,  February 28,
       2016  2015  2016  2015
                 
GAAP operating expenses$390,510  $326,116  $1,454,553  $1,266,296
                 
Deduct: Non-cash share-based compensation expense(41,822)  (32,721)  (150,336)  (121,205)
Deduct: Amortization of intangible assets(3,428)  (4,039)  (14,077)  (16,213)
Deduct: Transaction costs related to business combinations(40)  -  (3,884)  (4,001)
                 
Non-GAAP adjusted operating expenses$345,220  $289,356  $1,286,256  $1,124,877
                 
                 
       Three Months Ended  Twelve Months Ended
       February 29, February 28, February 29,  February 28,
       2016  2015  2016  2015
                 
GAAP operating income$71,772  $67,608  $288,048  $249,994
                 
Add: Non-cash share-based compensation expense45,768  36,290  166,234  135,232
Add: Amortization of intangible assets6,862  6,615  25,803  26,885
Add: Transaction costs related to business combinations40  -  3,884  4,001
                 
Non-GAAP adjusted operating income$124,442  $110,513  $483,969  $416,112
                 
Non-GAAP adjusted operating margin22.9%  23.8%  23.6%  23.3%
                 
                 
       Three Months Ended    
       February 29, February 28, Year-Over-Year  
       2016  2015  Growth Rate 
                 
GAAP subscription revenue by offering type          
 Infrastructure-related offerings$390,706  $340,778  14.7%   
 Adjustment for currency impact$10,497  -      
  Non-GAAP Infrastructure-related subscription revenue on a constant currency basis$401,203  $340,778  17.7%   
                 
 Application development-related and other emerging technology offerings$88,936  $64,295  38.3%   
 Adjustment for currency impact3,032  -      
  Non-GAAP Application development-related and other emerging technology subscription revenue on a constant currency basis$91,968  $64,295  43.0%   
                 
GAAP subscription revenue479,642  405,073  18.4%   
Adjustment for currency impact13,529  -      
Non-GAAP subscription revenue on a constant currency basis$493,171  $405,073  21.7%   
                 
GAAP training and services revenue$63,860  $58,869  8.5%   
Adjustment for currency impact3,017  -      
Non-GAAP training and services revenue on a constant currency basis$66,877  $58,869  13.6%   
                 
GAAP total subscription, training and services revenue$543,502  $463,942  17.1%   
Adjustment for currency impact16,546  -      
Non-GAAP total subscription, training and services revenue on a constant currency basis$560,048  $463,942  20.7%   
                 
                 
       Twelve Months Ended    
       February 29, February 28, Year-Over-Year  
       2016  2015  Growth Rate 
                 
GAAP subscription revenue by offering type          
 Infrastructure-related offerings$1,480,463  $1,324,693  11.8%   
 Adjustment for currency impact$80,616  -      
  Non-GAAP Infrastructure-related subscription revenue on a constant currency basis$1,561,079  $1,324,693  17.8%   
                 
 Application development-related and other emerging technology offerings$322,986  $236,541  36.5%   
 Adjustment for currency impact21,714  -      
  

Non-GAAP Application development-related and other emerging technology subscription
revenue on a constant currency basis

$344,700  $236,541  45.7%   
                 
GAAP subscription revenue1,803,449  1,561,234  15.5%   
Adjustment for currency impact102,330  -      
Non-GAAP subscription revenue on a constant currency basis$1,905,779  $1,561,234  22.1%   
                 
GAAP training and services revenue$248,781  $228,255  9.0%   
Adjustment for currency impact18,460  -      
Non-GAAP training and services revenue on a constant currency basis$267,241  $228,255  17.1%   
                 
GAAP total subscription, training and services revenue$2,052,230  $1,789,489  14.7%   
Adjustment for currency impact120,790  -      
Non-GAAP total subscription, training and services revenue on a constant currency basis$2,173,020  $1,789,489  21.4%   
           
 

 

RED HAT, INC.
Supplemental Information
(Unaudited)
(In thousands - except per share amounts)
                        
                        
Change in deferred revenue balances                 
            

Current
Deferred
Revenue

  

Long Term
Deferred
Revenue

  

Total
Deferred
Revenue

  
                        
Balance at February 28, 2015     $1,095,115   $387,213   $1,482,328   
 Constant currency change in deferred revenue (1)191,232   69,615   260,847   
 Impact from foreign currency translation     (13,439)   (7,192)   (20,631)   
Balance at February 29, 2016     $1,272,908   $449,636   $1,722,544   
                        
Year-over-year growth rate     16.2%   16.1%   16.2%   
Year-over-year growth rate on a constant currency basis17.5%   18.0%   17.6%   
                        
(1) Change in deferred revenue includes approximately $0.4 million acquired as part of business combinations.  
                        
                        
Revenue growth by geographical segment                 
            Americas   EMEA   APAC  Consolidated
                        

Total revenue for the three months ended February 29, 2016

$357,940   $115,468   $70,094  $543,502
 Adjustment for currency impact     5,074   8,510   2,962  16,546

Total revenue on a constant currency basis for the three months
ended February 29, 2016

$363,014   $123,978   $73,056  $560,048
                        
Total revenue for the three months ended February 28, 2015$305,481   $100,274   $58,187  $463,942
                        
Year-over-year growth rate     17.2%   15.2%   20.5%  17.1%
Year-over-year growth rate on a constant currency basis18.8%   23.6%   25.6%  20.7%
                        
                        
Total revenue for the twelve months ended February 29, 2016$1,354,345   $436,304   $261,581  $2,052,230
 Adjustment for currency impact     16,743   75,887   28,160  120,790

Total revenue on a constant currency basis for the twelve months
ended February 29, 2016

$1,371,088   $512,191   $289,741  $2,173,020
                        
Total revenue for the twelve months ended February 28, 2015$1,144,237   $410,299   $234,953  $1,789,489
                        
Year-over-year growth rate     18.4%   6.3%   11.3%  14.7%
Year-over-year growth rate on a constant currency basis19.8%   24.8%   23.3%  21.4%
 
  • 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 a 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 the ability of the Company to compete effectively; the ability to deliver and stimulate demand for new products and technological innovations on a timely basis; delays or reductions in information technology spending; the effects of industry consolidation; 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; 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.