Red Hat has presented impressive third quarter results for fiscal year 2018, continuing to achieve 20 per cent growth year-over-year, but shares fell by 4 per cent in after-hours trading.
The company’s third quarter total revenue came in at $748 million, representing 22 per cent year-over-year and 20 per cent in constant currency.
In addition to this, Red Hat achieved third quarter operating cash flow of $160 million, an increase of 18 per cent year-over-year. Operating cash flow of $561 million, up 21 per cent year-over-year was also recorded.
Despite consistently achieving strong results, the open source solutions company has failed to stimulate interest among investors, all while gaining a place on the Fortune 1000 list.
Jim Whitehurst, President and Chief Executive Officer of Red Hat, said: “We again delivered over 20% year-over-year growth in both subscription revenue and total revenue due to strong customer demand for hybrid cloud technologies, including our core technologies, container platforms and solutions that enable and manage multiple cloud and private cloud environments.”
In 2017 Red Hat embarked on a mission to deliver containerised services with a new iteration of its Openstack platform, an important development with the enterprise in mind, aiming to deliver speed, scale and efficiency.
“Our growing strategic position within enterprise IT organizations is evidenced by the strong cross selling of our broad portfolio of technologies, which led to 30% year-over-year growth in deals over $1 million and over 40% growth in Application Development-related and other emerging technology subscription revenue,” said Whitehurst.
Also this year, Red Hat joined Orange on a network virtualisation project, the target of which is to build modern infrastructures for agile networks and to better address the requirements of service providers.
Whitehurst said: “In the third quarter, strong execution contributed to a powerful combination of 22% total revenue growth, 47% GAAP operating income growth, 25% non-GAAP operating income growth, and 18% operating cash flow growth,” stated Eric Shander, Executive Vice President and Chief Financial Officer of Red Hat. “Based on our third quarter results, we anticipate exiting the fiscal year with an annualized run-rate of approximately $3 billion for total revenue.”