Red Hat | $RHT Stock | Shares Dim After Revenue Miss and Lowered Outlook

Red Hat

Red Hat, Inc. (NYSE: RHT)


Shares of Red Hat tumbled nearly 6.8% in after-hours trading on Wednesday after the Linux operating system distributor revealed mixed financial results for its second-quarter. Revenue during the three months to August 31 fell short Wall Street expectations.

The company also failed to impress investors with its lower than expected forecast for the current quarter. RHT stock has rallied nearly 19% year to date and closed the regular session at $143.16.

RHT Earnings & Outlook

Red hat

Red Hat reported net income of $86.9 million, or $0.46 per share, down from $97.1 million, or $0.53 per share, in second quarter of the previous year. Excluding special items, the company earned $0.85 per share.

Sales grew 14% to $822.7 million, from $723.4 million in the prior-year quarter. Thompson Reuters based on analyst estimates, was for adjusted earnings of $0.82 per share on sales of $830 million.

Red Hat expects to report adjusted earnings of $0.87 per share on sales in the range of between $848 million and $856 million for the current quarter. Analysts are for adjusted earnings of $0.92 per share and sales of $862.2 million.

Red Hat CEO Comments

Jim Whitehurst, the president and chief executive officer of the company commented, “Customers continue to prioritize their digital transformation initiatives, and they are adopting Red Hat’s hybrid cloud enabling technologies to modernize their applications and drive greater efficiency and effectiveness in their business. The expansion of our technology portfolio has increased our strategic importance with customers, which is evidenced by the number of deals over five million dollars in the second quarter more than doubling year-over-year.”

Red Hat, Inc. Company Profile

Red Hat, Inc. provides open source software solutions to develop and offer operating system, virtualization, management, middleware, cloud, mobile, and storage technologies to various enterprises worldwide.

It offers infrastructure-related solutions, such as Red Hat Enterprise Linux, an operating system platform that runs on hardware for use in hybrid cloud environments; Red Hat Satellite, a system management offering that helps to deploy, scale, and manage in hybrid cloud environments; and Red Hat Enterprise Virtualization, a software solution that allows customers to utilize and manage a common hardware infrastructure to run multiple operating systems and applications.

The company offers application development-related and other technology solutions, such as Red Hat JBoss Middleware, a solution for developing, deploying, and managing applications; integrating applications, data, and devices; and automating business processes in hybrid cloud environments.

It also offers Red Hat Mobile, a software development platform that enables customers to develop, integrate, deploy, and manage mobile applications for enterprises; and Red Hat Storage, a software solution that enables customers to manage large, unstructured, or semi-structured data in hybrid cloud environments.

It also provides consulting, support, and training services; and realtime operating system, distributed computing, directory services, and user authentication. Red Hat, Inc. has collaboration with Juniper Networks Expand to provide a unified solution for enterprises designed to manage and run applications and services.

The company was formerly known as Red Hat Software, Inc. and changed its name to Red Hat, Inc. in June 1999. Red Hat, Inc. was founded in 1993 and is headquartered in Raleigh, North Carolina. – Yahoo Finance