Shares of Red Hat jumped today as the software maker revealed that strong sales pushed second quarter revenue significantly higher.
Red Hat enjoyed a healthy three-month run, pulling in revenue of $65.7m. That total marks a 42 per cent year-over-year rise. In addition, Red Hat's second quarter net income reached $16.7m - a 42 per cent hike from the same period last year. The results inspired investors and analysts to reward the Linux maker with praise.
In the after-hours markets, Red Hat's shares jumped more than 10 per cent to $18.29, at the time of this report.
Similarly, financial analysts on a conference call to discuss the Red Hat results fought to heap encouraging words on management.
"Congratulations, everybody," said an analyst from Thomas Weisel Partners.
"Congratulations on the quarter," added a Credit Suisse First Boston guru.
Folks from UBS and Robert Baird offered their compliments as well. "Wow" and "Very good execution here" said others.
The performance helped demonstrate the strength of backbone holding up the financial analyst community, and it made all of us on the call feel good.
Management played off the good vibrations to tout increasing interest in its server products and services and momentum with partners such as Oracle and HP. Fair enough, since subscription revenue increased 56 per cent year-over-year in the second quarter to $54.3m.
Red Hat certainly has the look and feel of a healthy company these days. Still, its quarterly revenue totals must be set against how much the likes of IBM, HP and Dell make selling Linux servers. While Linux enjoys the strongest growth rate of any server OS, most of that money travels to the hardware makers, leaving Red Hat and Novell to fight over scraps. ®