Red Hat shares surged 14 percent Friday in the wake of a strong quarterly performance that eased worries about the company’s growth prospects.
The fiscal third-quarter results that the company released after the markets closed Thursday included a 19 percent jump in billings, the fastest growth for the Linux software company in six quarters.
The billings growth “was nicely above consensus ... and helps allay concerns around core business reaching saturation,” Baird analyst Stephen Ashley wrote in a research report.
The Raleigh-based company’s revenue and net income for the quarter also came in ahead of Wall Street’s expectation.
Never miss a local story.
The billings growth was driven by a rebound in Europe and in business from the U.S. government.
The investor reaction marked a sharp turnaround from September, when the company’s shares fell 12 percent the day after the company reported disappointing billings for its fiscal second quarter.
Red Hat shares are up 6 percent this year.