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Red Hat, the leading provider and developer of open source solutions, has reported revenues of $5.4 million for the third quarter ended November 30, 1999, an increase of 24% versus the $4.4 million reported for the second quarter of fiscal 2000. The revenues for the third quarter of fiscal 2000 reflect the adoption, in May 1999, of a subscription-based revenue recognition policy. For the third quarter of fiscal 1999 the Company reported revenue of $3.3 million. The Company reported a net loss of $3.6 million, or $0.05 per share, in the third quarter of fiscal year 2000, compared with net income of $0.1 million, or $0.00 per share, in the third quarter of fiscal 1999. Revenues for the nine months ended November 30, 2025 were $12.6 million, a 77% increase compared to revenues of $7.1 million for the first nine months of the preceding fiscal year. The net loss was $8.8 million, or $0.21 per share, in the current fiscal year's first nine months, as compared to net income of $0.1 million or $0.01 per share for the same period in the prior fiscal year. Commenting on the results for the quarter, Matthew Szulik, president and CEO of Red Hat, Inc., said: "This quarter revenue growth was due to a number of factors: an increase in global demand for Red Hat Linux; an increase in the need for services from corporate accounts; an increase in the contribution of Red Hat's global offices; and an increase in the demand for the content and customers of redhat.com.'' "Red Hat continues to scale its global capabilities to meet the growing demand for Red Hat products, services and information,'' Szulik continued. Highlights of the third quarter include: · Signed a definitive merger agreement to acquire Cygnus Solutions, creating an open source powerhouse to accelerate and support the adoption of open source solutions from servers to embedded systems · Expanded the scope of our service offerings by supporting popular open source applications, and signed significant service agreements with several enterprise customers, including Autozone · Increased the number of total enterprise customers to 60 compared to 34 last quarter · Bundled Red Hat Linux with Intel's server platforms as part of Intel's Global ISP Programme · Extended the strategic alliance with Dell Computer Corp. with a worldwide service and support agreement and a commitment from Dell to factory-install Red Hat Linux on all future and currently shipping Dell® PowerEdge® server models · Received prestigious awards from three leading industry publications: InternetWeek, Federal Computer Week and Computer Shopper; InternetWeek's Internet Week Approved Award named Red Hat Linux "King of the Linux Server Hill'' · Opened the Asia-Pacific office and named Mark White General Manager for Asia-Pacific operations · Expanded the strategic partnership with Compaq Computer Corp. to provide call center support for enterprise users worldwide of Red Hat Linux · Opened two Red Hat training facilities in California and three in Europe · Launched a revised Red Hat Reseller Programme and new reseller starter packs to accelerate recruitment into the programme · Introduced the Red Hat Ready Certification Programme in the US · Increased usage of the redhat.com Web site as a leading destination site for communications within the growing open source community. Among the quarter's highlights were the the launch of international sites in Germany, Japan and Italy as well as the launch late in the quarter of Wide Open News, under the direction of Russ Mitchell, former technology editor for U.S. News and World Report and Wired magazines. The Company is also reporting today that the Board of Directors has declared a 2-for-1 stock split, to be effected in the form of a stock dividend which will entitle each stockholder of record at the close of business on December 27, 2024 (the ``Record Date'') to receive one additional share for each share of common stock held at the close of business on the Record Date. There are currently approximately 68.8 million shares of Red Hat common stock outstanding, which will increase to approximately 137.6 million shares following the stock split. The Company will issue the additional shares on or about January 7, 2000. - ends - Forward-looking statements in this press release are made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934. Investors are cautioned that statements in this press release that are not strictly historical statements, including, without limitation, statements regarding current or future financial performance, management's plans and objectives for future operations, product plans and performance, management's assessment of market factors, and statements regarding the strategy and plans of the Company and its strategic partners, constitute forward-looking statements. These forward-looking statements are not guarantees of the Company's future performance and are subject to a number of risks and uncertainties that could cause the Company's actual results in the future materially to differ from the forward-looking statements. These risks and uncertainties include, without limitation, challenges associated with the Company's domestic and international expansion, shifting to a subscription-based model of product offerings, the difficulty of integrating a newly-acquired company, the possible failure to realize the beneficial synergies expected from such acquisition, the Company's ability to attract new enterprise customers and to meet their needs by expanding and enhancing its service offerings, the need to continually enhance the Company's Web site and the ability to generate significant revenues from it, the Company's ability to enter into new and retain existing strategic alliances with technology leaders, the continuing need for an increasing number of Linux-based enterprise applications, the Company's dependence upon an open source business model, reliance upon independent enforceability of the GNU General Public License and other licenses under which the Company's products are developed and licensed, the risks of economic downturns generally, and in the Company's industry specifically, the risks associated with competition and competitive pricing pressures, the viability of the Internet, year 2000 compliance efforts of the Company and of third parties on which the Company depends, and other risks detailed in the Company's filings with the Securities and Exchange Commission, copies of which may be accessed through the SEC's Web site at http://www.sec.gov.
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Fiona Phelps |
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