Join        Login             Stock Quote

Red Hat (RHT) 3Q Earnings Drop 8.9 Pct, Matching Estimates; To Buy ManageIQ

 December 20, 2012 04:21 PM

(By Balaseshan) Red Hat Inc. (NYSE: RHT), a provider of open source software solutions, reported a 8.9% decrease in quarterly earnings due to higher costs and expenses. Revenue beat consensus, while earnings matched Street's expectations.

Earnings for the third quarter were $34.8 million or $0.18 per share, down from $38.2 million or $0.19 per share last year. Adjusted earnings per share (EPS) rose to $0.29 from $0.28.

Revenue increased 18% to $343.6 million. On a constant currency basis, total revenue grew 21%.

Analysts, on average, polled by Thomson Reuters had expected a profit of $0.29 per share on revenue of $337.97 million for the third quarter.

[Related -Red Hat Inc (NYSE:RHT): A Top Rebound Story For 2014]

Revenue from subscriptions grew 19% to $294.2 million.

Adjusted gross margin improved to 86% from 85%. Adjusted operating margin shrank to 24.0% from 27.2%.

"In Q3, we used our strong balance sheet and cash flow to repurchase about $52 million of common stock, in addition to closing the FuseSource acquisition which enhances our offering in the fast-growing Application Integration software space," said Finance chief Charlie Peters.

In a separate release, Red Hat said it has agreed to buy privately-held ManageIQ, a provider of enterprise cloud management and automation solutions, for about $104 million in cash. With the addition of ManageIQ technologies to its portfolio, Red Hat will expand the reach of its hybrid cloud management solutions for enterprises.

[Related -Red Hat Inc (RHT) Q2 Earnings Preview: Rising Costs A Red Flag]

The acquisition is expected to have no material impact to Red Hat's revenue for its fiscal year ending Feb. 28, 2013. Management expects that adjusted operating expenses will rise by about $2 million per quarter as a result of the transaction, and stock-based compensation and amortization expense will increase by about $2 million per quarter.

RHT closed Thursday's regular session up 0.79% at $52.61. The stock has been trading between $39.19 and $62.75 for the past 52 weeks.



Post Comment -- Login is required to post message
Alert for new comments:
Your email:
Your Website:

rss feed

Latest Stories

article imageBogle Says Indexing Destined To Win The Battle Of The Quants

Vanguard founder John Bogle gave a powerful speech last month at the Q Group’s Spring Seminar that lays out read on...

article imageVMAX and VMIN Poised to Be Most Important VIX ETP Launch in Years

REX Shares is launching two new VIX exchange-traded products on Tuesday in what is likely to be the most read on...

article imageThe April 29 Gold Triangle Breakout Update

If you’re just watching stocks, you may be missing this powerful Triangle Breakout surge in read on...

article imageSell In May, But It Is A Presidential Election Year

With May just around the corner, articles covering the "Sell in May' phenomenon are not in short supply and read on...

Popular Articles

Daily Sector Scan
Partner Center

Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.