Red Hat: More Turnover and Profit Thanks to Linux

The second quarter 2008 ended August 31, 2007 for Red Hat, whose business year ends February 29, 2008. Red Hat reported a turnover of US$ 127.3 in the second quarter, which is equivalent to a 28 percent increase compared to last year's figures, and seven percent up on the first quarter of 2008. Red Hat mainly owes its success to sales of software subscriptions of its enterprise Linux variant. Turnover of Red Hat Enterprise Linux totaled US$ 109.2 m, which is 29 percent up on the previous year's figures of US$ 84.9 m, and six percent up on the previous quarter. Net profits rose by 64 percent to US$ 18.2 m, compared with US$ 11 m in 2006. On a per share basis this means a dividend of US$ 0.09 compared with US$ 0.05 last year. Red Hat points to the more than 3000 applications that are now certified on the Red Hat platform.

Charlie Peters, Red Hat's Chief Financial Officer was also pleased with the development of operative profits and cash flow. "We continue to deliver strong operating profitability and cash flow". Peters sees the demand for Open Source solutions continuing to grow, and sees the need to invest in infrastructure in the interest of Red Hat's shareholders.

Parallel to the interim report, Peters had two personnel announcements to make. The previous head of the Red Hat Financial Division, Mark Cook, is being promoted to Vice President Finance and Controller; Paul Argiry will be taking over the position as Vice President and Treasurer. Cook joined Red Hat in 2004; Argiry's last position was as the Chief Financial Officer with Californian electronics corp., Jabil Circuit.
This is the third change to Red Hat's executive team in just a few days, with marketing boss Tim Yeaton having been replaced by Michael Chen. At the beginning of the week, Red Hat's shares had been downgraded from "outperforming" to "neutral" due to organizational and structural issues that started with the acquisition of middleware vendor Jboss.