Red Hat | $RHT Stock | 1Q Earnings Preview


Red Hat, Inc. (NYSE: RHT)




RHT Chart
RHT is set to report its first quarter 2016 earnings today, Wednesday, June 22, 2016 after the market close. The street consensus is for earnings of $0.50 a share on revenues of $562.76 million.


Analyst Expectations

Analysts at Credit Suisse First Boston had the following comments out yesterday on the upcoming RHT earnings report after today’s market close.

Channel Survey Suggests an Inline to Slightly Better Fiscal Q1: Red Hat is scheduled to report fiscal Q1 results on Wednesday, June 22, after the market close. We expect Red Hat to report Q1 results with revenue above consensus and billings in line with or slightly above consensus expectations, driven by continued demand for Red Hat Linux coupled with strong cross-selling of emerging technologies, such as JBoss, OpenShift, RHEV, and storage software into its installed base. Our checks suggest that Red Hat Linux continues to penetrate into enterprises to host mission-critical as well as emerging (cloud, big data, and storage, etc.) workloads. For the May quarter, we currently forecast revenue of $565.0 million (18.3% year-over-year increase), billings of $499.7 million (11.3% year-over-year growth), and EPS of $0.50 versus consensus expectations of $562.8 million, $519.6 million, and $0.47, respectively.

FY2017 Estimates Appear Conservative: While Linux unit license shipments growth is forecast to accelerate from 12.8% in 2015 to 13.7% in 2016, consensus billings estimates imply a deceleration from 17.3% (in constant currency) in FY2016 to 15.0% in FY2017. We believe that Red Hat should be able to deliver FY2017 billings and revenue ahead of consensus expectations given the acceleration in core Linux growth and increasing adoption of emerging technologies coupled with renewal tailwinds.


About Red Hat, Inc.

Red Hat, Inc. (Red Hat), incorporated on October 17, 1998, is a provider of open source software solutions, using a community-powered approach to develop and offer operating system, virtualization, management, middleware, cloud, mobile and storage technologies. The Company operates through three geographical segments: the Americas (the United States, Canada and Latin America); Europe, Middle East and Africa (EMEA), and Asia Pacific. The Company’s products and services include infrastructure-related offerings, application development-related and other technology offerings, and consulting, support and training services. The Company’s infrastructure-related offerings include Red Hat Enterprise Linux, Red Hat Satellite and Red Hat Enterprise Virtualization. Red Hat Enterprise Linux is an operating system platform that runs on a range of hardware, and is used in physical, virtual, container and cloud environments. Red Hat Enterprise Linux is also available in multiple variants that allow customers to obtain a version of Red Had Enterprise Linux specifically for their use cases, applications and hardware architectures. Variant options include Red Hat Enterprise Linux Atomic Host, designed to run applications with Linux containers, Red Hat Enterprise Linux for High-Performance Computing, Red Hat Enterprise Linux for IBM z Systems and Red Hat Enterprise Linux for SAP Applications. – Reuters