Red Hat Reports 2015 Second Quarter Financial Results
Red Hat, Inc. today announced financial results for its fiscal year 2015 second quarter ended August 31, 2014. Total revenue for the quarter was $446 million and subscription revenue for the quarter was $389 million, both increased 19% year-over-year.
“Broad demand for open source technologies, combined with Red Hat’s value proposition and market leadership position, has helped to drive organic revenue growth in the mid-to-high teens for the last 10 quarters,” stated Jim Whitehurst, President and Chief Executive Officer of Red Hat. “Our high level of execution and commitment to investing across our technology stack, including enabling open, hybrid cloud computing in the enterprise, has led to Red Hat being recognized once again by Forbes, Inc. on its list of the World’s Most Innovative Companies.”
GAAP operating income for the second quarter was $64 million, up 16% year-over-year. After adjusting for stock compensation, amortization expenses, certain facility exit costs and transaction costs related to business combinations, as detailed in the tables below, non-GAAP operating income for the second quarter was $109 million, up 15% year-over-year. For the second quarter, GAAP operating margin was 14.4% and non-GAAP operating margin was 24.4%.
GAAP net income for the quarter was $47 million, or $0.25 per diluted share, compared with $41 million, or $0.21 per diluted share, in the year ago quarter. After adjusting for stock compensation, amortization expenses, certain facility exit costs and transaction costs related to business combinations, as detailed in the tables below, non-GAAP net income for the quarter was $78 million, or $0.41 per diluted share, as compared to $68 million, or $0.35 per diluted share, in the year ago quarter.
Operating cash flow was $108 million for the second quarter, as compared to $119 million in the year ago quarter. At quarter end, the company’s total deferred revenue balance was $1.25 billion, an increase of 18% on a year-over-year basis. Total cash, cash equivalents and investments as of August 31, 2014 was $1.32 billion, after repurchasing approximately $80 million of common stock, or approximately 1.5 million shares, in the second quarter. Red Hat has repurchased approximately $160 million of common stock, or approximately 3.0 million shares, during the first six months of fiscal year 2015.
“We experienced strong growth across our routes to market during the second quarter,” stated Charlie Peters, Executive Vice President and Chief Financial Officer of Red Hat. “The fastest growing part of our channel business comes from the 80+ Red Hat certified public cloud providers that provide our technologies on-demand in their clouds. The rapid revenue growth from these public cloud partners, which we recognize immediately and contains no deferred revenue, helped us to meaningfully exceed our second quarter revenue guidance.”
