Red Hat, Inc. (NYSE: RHT), the world’s leading provider of open source solutions, today announced financial results for its fiscal year 2012 first quarter ended May 31, 2011.
Total revenue for the quarter was $264.7 million, an increase of 27% from the year ago quarter. Subscription revenue for the quarter was $225.5 million, up 26% year-over-year.
“Red Hat has begun fiscal year 2012 with a strong first quarter including year-over-year billings growth of 28% that contributed to revenue and profitability that exceeded the high-end of our expectations,” stated Jim Whitehurst, President and Chief Executive Officer of Red Hat. “We believe there is a fundamental shift in IT spending, in which cloud computing and virtualization have become key strategic priorities. We believe that Red Hat is well positioned to capitalize on this growing demand as enterprise customers look to Red Hat when upgrading and modernizing their IT infrastructure.”
GAAP operating income for the first quarter was $45.4 million, or a 17.1% operating margin. After adjusting for stock compensation and amortization expenses as detailed in the tables below, non-GAAP operating income for the first quarter was $66.5 million, up 28% year-over-year. Non-GAAP operating margin was 25.1%, up 30 basis points from the year ago quarter.
Net income for the quarter was $32.5 million, or $0.17 per diluted share, compared with $24.1 million, or $0.12 per diluted share, in the year ago quarter. After adjusting for stock compensation and amortization expenses as detailed in the tables below, non-GAAP net income for the quarter was $47.0 million, or $0.24 per diluted share, as compared to $35.6 million, or $0.18 per diluted share, in the year ago quarter.
Operating cash flow was $90.2 million for the first quarter, as compared to $60.6 million in the year ago quarter. At quarter end, the company’s total deferred revenue balance was $786.0 million, an increase of 26% on a year-over-year basis. Total cash, cash equivalents and investments as of May 31, 2011 was $1.27 billion.
“Strong sales execution, focused spending and good collections drove 49% growth in operating cash flow year-over-year,” stated Charlie Peters, Executive Vice President and Chief Financial Officer of Red Hat. “Red Hat grew first quarter non-GAAP operating income by 28% year-over-year even as we ramped up marketing spending for the Red Hat Summit and product launches, and continued investments in R&D to enable further broadening of our product portfolio. We introduced innovative new cloud technologies such as OpenShift, our PaaS offering, and CloudForms, our IaaS offering. In addition, we enhanced our core products, including the release of Red Hat Enterprise Linux 6.1 and strengthened our partnerships with the launch of Open Virtualization Alliance.”
Additional information on Red Hat’s reported results, including a reconciliation of the non-GAAP adjusted results, are included in the financial tables below. A live webcast of Red Hat’s results will begin at 5:00 pm ET today and can be accessed by the general public at Red Hat’s investor relations website at http://investors.redhat.com. A replay of the webcast will be available shortly after the live event has ended.