Categories AlphaGraphs, Earnings, Technology

Earnings preview: What to expect from Red Hat’s Q1 report

Open-source software company Red Hat, Inc. (NYSE: RHT), which is on the way to becoming a part of International Business Machines (IBM), will be publishing first-quarter results Thursday after the market’s close.

Taking a cue from the stable market for cloud computing solutions, analysts have predicted a 19% year-over-year increase in first-quarter earnings to $0.86 per share. Driving the profit growth, revenues are seen gaining about 15% to $931.6 million.

Going by the past performance, wherein the company beat expectations in all of its reporting periods in the last fiscal year, the chances of first-quarter results surpassing the forecast are very high. Red Hat’s continuing dominance in the Linux server market is expected to spur further subscription growth.

Red Hat Q1 revenue up 14%

The North Carolina-based tech firm continues to witness widespread adoption of its products by businesses for deploying applications on hybrid and multi-cloud environments, which will be reflected in the first-quarter results.

The company continues to witness widespread adoption of its products by businesses for deploying applications

The management is expected to provide updates on the proposed merger between Red Hat and IBM, which is on track for closure in the second half of the year after securing most of the approvals. Earlier, it was delayed for want of regulatory clearance, including antitrust approval. Currently, the build-up of investor sentiment is centered on the pending merger.  

Also see: IBM Q1 2019 Earnings conference call

Supported by a double-digit increase in subscriptions, revenues jumped 14% to $879 million in the fourth quarter, lifting adjusted earnings up by 26% to $1.16 per share. The bottom-line also benefitted from lower income tax provision, and topped the Street view. The hybrid cloud technology solutions witnessed solid demand during the quarter. 

Microsoft (MSFT), which competes with Red Hat in multiple areas, reported above-consensus revenues and earnings for the third quarter, with solid contributions from all the three business segments. Earlier this month, Salesforce (CRM) reported a 26% growth in first-quarter earnings to $0.93 per share even as revenues increased by a fourth to $3.7 billion.

Red Hat’s stock climbed to a record high this week, crossing the $185-mark. It has been hitting new highs consistently since the beginning of the year, gaining 7% during that period. Over the past twelve months, the stock moved up 31%.

Follow our Google News edition to get the latest stock market, earnings and financial news at your fingertips

Most Popular

FDX Earnings: FedEx Q1 adjusted earnings drop; revenue up 5%

Cargo giant FedEx Corporation (NYSE: FDX) Thursday reported a decline in first-quarter adjusted earnings, despite an increase in revenues. The company also provided guidance for fiscal 2023. Net income, adjusted

Key highlights from Darden Restaurants (DRI) Q1 2023 earnings results

Darden Restaurants, Inc. (NYSE:DRI) reported first quarter 2023 earnings results. Total sales increased 6.1% year-over-year to $2.4 billion, driven by blended same-restaurant sales growth of 4.2%. Net earnings amounted to

ACN Earnings: Key quarterly highlights from Accenture’s Q4 2022 financial results

Accenture (NYSE: ACN) reported fourth quarter 2022 earnings results today. Total revenues were $15.4 billion, up 15% year-over-year in US dollars and up 22.4% in local currency. Net income attributable

Add Comment
Viewing Highlight