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Red Hat results shine as subscription revenue rises 16 percent

Dan Cox of Hewlett-Packard talks about Red Hat Linux at the Linux Expo in New York on January 23, 2003. REUTERS/Chip East
Dan Cox of Hewlett-Packard talks about Red Hat Linux at the Linux Expo in New York on January 23, 2003. REUTERS/Chip East

(Reuters) - Red Hat Inc, the world's largest commercial distributor of the Linux operating system, reported better-than-expected quarterly results as subscription revenue rose 16 percent.

Shares of the company rose 4 percent in extended trading.

"The fourth quarter was ... highlighted by a record number of deals over $1 million and 24 percent growth in our billings proxy to $565 million," Chief Executive Jim Whitehurst said in a statement.

Billings proxy is defined by the company as total revenue plus change in deferred revenue.

Red Hat's Linux competes with Microsoft Corp's Windows operating systems in corporate markets, especially for use in servers.

Red Hat's net income rose to $45.07 million, or 24 cents per share, for the quarter ended February 28, from $42.97 million, or 22 cents per share, a year earlier.

On an adjusted basis, the company earned 39 cents per share, above analysts' consensus estimates of 37 cents per share.

Revenue rose 15 percent to $400.4 million.

Subscription revenue rose to $351 million.

Analysts had expected revenue of $398.9 million, according to Thomson Reuters I/B/E/S.

Shares of the company have gained 14 percent over the last year up to Thursday's close of $56.13.

(Reporting by Soham Chatterjee; Editing by Don Sebastian)

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