Linux software company Red Hat ended its fiscal year with panache and projected that its robust revenue and earnings growth will continue over the next 12 months.
The Raleigh company reported after the markets closed Wednesday that its revenue totaled $195.9 million, up 18 percent from a year ago, in the quarter that ended Feb. 28.
Net income was $36.5 million, or 19 cents per share, after adjusting for stock compensation and amortization. That was an improvement from $28.5 million a year ago.
"It is clear we are gaining market share and mind share," Charlie Peters, chief financial officer, said during a conference call.
Both revenue and profit per share outpaced analysts' expectations.
All in all, it was another strong performance, said analyst Steven Ashley of Robert W. Baird & Co. On the surface, the company's billings - an indicator of future revenue - looked disappointing, Ashley said. They rose 18 percent, less than expected. But when fluctuations in foreign currency were taken into account, billings were better than expected, he noted.
CEO Jim Whitehurst said the company is well-positioned to take advantage of corporate data centers shifting to cloud computing and virtualization. Cloud computing allows access to networks of servers on the Internet. Virtualization software enables efficient use of servers.
Last week, Red Hat announced that technology giant IBM had chosen Red Hat software as the foundation for its new cloud-computing service.
"IBM's selection of Red Hat technology clearly underscores the significance of open-source for cloud deployment," Whitehurst said. Red Hat's open-source Linux software is free, but customers pay for maintenance and support.
For the full year 2009, Red Hat posted a profit of $138.1 million, or 71 cents per share, versus $121.5 million a year ago after adjustments. Revenue totaled $748.2 million, up 15 percent.
Peters projected revenue for the current fiscal year will range between $835 million and $850 million, an increase of 12 percent to 14 percent. He projected earnings per share after adjustments will range from 71 cents to 74 cents.
Peters said Red Hat continued to invest in the future last year. The company added more than 350 workers, boosted its engineering staff by 20 percent and its sales staff by 13 percent. Today it has more than 3,200 workers worldwide, including 650 in Raleigh.
Earlier Wednesday, Red Hat shares closed at $30.73, up 53 cents. The company's shares have doubled in the past year.
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