Red Hat Inc. (RHT, Financial) filed Quarterly Report for the period ended 2011-05-31.
Red Hat Inc. has a market cap of $8.97 billion; its shares were traded at around $46.49 with a P/E ratio of 73.8 and P/S ratio of 9.9. Red Hat Inc. had an annual average earning growth of 20.2% over the past 5 years.
Training revenue includes fees paid by our customers for delivery of educational materials and instruction. Services revenue includes fees received from customers for consulting services regarding our offerings, deployment of Red Hat enterprise technologies and for delivery of added functionality to Red Hat enterprise technologies for our major customers and OEM partners. Total training and services revenue increased by 30.4% or $9.1 million to $39.2 million for the three months ended May 31, 2011 from $30.1 million for the three months ended May 31, 2010. Training revenue increased 29.0% or $2.9 million as some enterprises continued to increase overall spending on discretionary items such as training and related travel in response to a better overall economic environment. Our services revenue increased by 31.1% or $6.2 million as a result of both a better overall economic environment and increased subscription sales. Combined training and services revenue increased as a percentage of total revenue to 14.8% for the three months ended May 31, 2011 from 14.4% for the three months ended May 31, 2010.
Cost of training and services revenue is mainly comprised of personnel and third-party consulting costs for the design, development and delivery of custom engineering, training courses and professional services provided to various types of customers. Cost of training and services revenue increased by 32.2% or $6.6 million to $27.2 million for the three months ended May 31, 2011 from $20.6 million for the three months ended May 31, 2010. The cost to deliver training increased 11.3% or $0.9 million to $8.5 million for the three months ended May 31, 2011 compared to $7.6 million for the three months ended May 31, 2010. The increase in training costs was primarily due to the use of outside contractors to deliver training services, which increased training costs by $1.2 million for the three months ended May 31, 2011 as compared to the three months ended May 31, 2010. Costs to deliver our services revenue increased by 44.2% or $5.8 million and primarily relate to additional employee compensation and travel associated with additions to our staff and the use of outside contractors which increased $3.6 million and $0.7 million, respectively. The remaining increase in costs to deliver our engineering and
Sales and marketing expense consists primarily of salaries and other related costs for sales and marketing personnel, sales commissions, travel, public relations and marketing materials and trade shows. Sales and marketing expense increased by 30.5% or $22.8 million to $97.3 million for the three months ended May 31, 2011 from $74.6 million for the three months ended May 31, 2010. This increase was primarily due to a $17.6 million increase in selling costs, which includes $15.7 million of additional employee compensation expense attributable to the expansion of our sales force from the prior year. The remaining increase relates to marketing costs, which grew $5.2 million or 35.4% for the three months ended May 31, 2011 as compared to the three months ended May 31, 2010. The increase in marketing costs includes $2.7 million related to increased headcount to support our expanding marketing efforts and $1.3 million related to our annual conference which we hosted during the first quarter of fiscal 2012. Our annual conference for fiscal 2011 was held during second quarter. Sales and marketing expense increased as a percentage of revenue to 36.8% for the three months ended May 31, 2011 from 35.7% for the three months ended May 31, 2010 as we continue to invest in our sales and marketing function to expand the breadth of our global sales coverage and depth of our product sales coverage.
Research and development expense consists primarily of personnel and related costs for development of software technologies and systems management offerings. Research and development expense increased by 18.8% or $7.6 million to $48.3 million for the three months ended May 31, 2011 from $40.7 million for the three months ended May 31, 2010. The increase in research and development costs primarily resulted from the expansion of our engineering group through direct hires. Employee compensation increased by $6.8 million. The remaining increase in research and development costs relates primarily to process and technology infrastructure enhancements, which increased $0.6 million. Research and development expense was 18.2% and 19.4% of total revenue for the three months ended May 31, 2011 and May 31, 2010, respectively.
General and administrative expense consists primarily of personnel and related costs for general corporate functions, including information systems, finance, accounting, legal, human resources and facilities expense. General and administrative expense increased by 18.5% or $4.9 million to $31.3 million for the three months ended May 31, 2011 from $26.4 million for the three months ended May 31, 2010. The increase in general and administrative expenses results from increased compensation-related expense of $2.2 million, litigation related costs, which increased $1.8 million and additional allowances for bad debt of $0.9 million. General and administrative expense decreased as a percentage of revenue to 11.8% for the three months ended May 31, 2011 from 12.6% for the three months ended May 31, 2010 as we continued to leverage our corporate functions.
Read the The complete Report
Red Hat Inc. has a market cap of $8.97 billion; its shares were traded at around $46.49 with a P/E ratio of 73.8 and P/S ratio of 9.9. Red Hat Inc. had an annual average earning growth of 20.2% over the past 5 years.
Highlight of Business Operations:
Revenue. For the three months ended May 31, 2011, total revenue increased 26.6% or $55.6 million to $264.7 million from $209.1 million for the three months ended May 31, 2010. Subscription revenue increased 25.9% or $46.5 million, driven primarily by additional subscriptions related to our principal RHEL technologies, which continue to gain broader market acceptance in mission-critical areas of computing, and our expansion of sales channels and geographic footprint. The increase is, in part, a result of the continued migration of enterprises in industries such as financial services, government, technology and telecommunications to our open source solutions from proprietary technologies. Training and services revenue increased 30.4% or $9.1 million for the three months ended May 31, 2011 as compared to the three months ended May 31, 2010. The increase is driven primarily by customer interest in new products and technologies and an improving economic environment in which enterprises are increasing discretionary spending in areas such as IT training and consulting.Training revenue includes fees paid by our customers for delivery of educational materials and instruction. Services revenue includes fees received from customers for consulting services regarding our offerings, deployment of Red Hat enterprise technologies and for delivery of added functionality to Red Hat enterprise technologies for our major customers and OEM partners. Total training and services revenue increased by 30.4% or $9.1 million to $39.2 million for the three months ended May 31, 2011 from $30.1 million for the three months ended May 31, 2010. Training revenue increased 29.0% or $2.9 million as some enterprises continued to increase overall spending on discretionary items such as training and related travel in response to a better overall economic environment. Our services revenue increased by 31.1% or $6.2 million as a result of both a better overall economic environment and increased subscription sales. Combined training and services revenue increased as a percentage of total revenue to 14.8% for the three months ended May 31, 2011 from 14.4% for the three months ended May 31, 2010.
Cost of training and services revenue is mainly comprised of personnel and third-party consulting costs for the design, development and delivery of custom engineering, training courses and professional services provided to various types of customers. Cost of training and services revenue increased by 32.2% or $6.6 million to $27.2 million for the three months ended May 31, 2011 from $20.6 million for the three months ended May 31, 2010. The cost to deliver training increased 11.3% or $0.9 million to $8.5 million for the three months ended May 31, 2011 compared to $7.6 million for the three months ended May 31, 2010. The increase in training costs was primarily due to the use of outside contractors to deliver training services, which increased training costs by $1.2 million for the three months ended May 31, 2011 as compared to the three months ended May 31, 2010. Costs to deliver our services revenue increased by 44.2% or $5.8 million and primarily relate to additional employee compensation and travel associated with additions to our staff and the use of outside contractors which increased $3.6 million and $0.7 million, respectively. The remaining increase in costs to deliver our engineering and
Sales and marketing expense consists primarily of salaries and other related costs for sales and marketing personnel, sales commissions, travel, public relations and marketing materials and trade shows. Sales and marketing expense increased by 30.5% or $22.8 million to $97.3 million for the three months ended May 31, 2011 from $74.6 million for the three months ended May 31, 2010. This increase was primarily due to a $17.6 million increase in selling costs, which includes $15.7 million of additional employee compensation expense attributable to the expansion of our sales force from the prior year. The remaining increase relates to marketing costs, which grew $5.2 million or 35.4% for the three months ended May 31, 2011 as compared to the three months ended May 31, 2010. The increase in marketing costs includes $2.7 million related to increased headcount to support our expanding marketing efforts and $1.3 million related to our annual conference which we hosted during the first quarter of fiscal 2012. Our annual conference for fiscal 2011 was held during second quarter. Sales and marketing expense increased as a percentage of revenue to 36.8% for the three months ended May 31, 2011 from 35.7% for the three months ended May 31, 2010 as we continue to invest in our sales and marketing function to expand the breadth of our global sales coverage and depth of our product sales coverage.
Research and development expense consists primarily of personnel and related costs for development of software technologies and systems management offerings. Research and development expense increased by 18.8% or $7.6 million to $48.3 million for the three months ended May 31, 2011 from $40.7 million for the three months ended May 31, 2010. The increase in research and development costs primarily resulted from the expansion of our engineering group through direct hires. Employee compensation increased by $6.8 million. The remaining increase in research and development costs relates primarily to process and technology infrastructure enhancements, which increased $0.6 million. Research and development expense was 18.2% and 19.4% of total revenue for the three months ended May 31, 2011 and May 31, 2010, respectively.
General and administrative expense consists primarily of personnel and related costs for general corporate functions, including information systems, finance, accounting, legal, human resources and facilities expense. General and administrative expense increased by 18.5% or $4.9 million to $31.3 million for the three months ended May 31, 2011 from $26.4 million for the three months ended May 31, 2010. The increase in general and administrative expenses results from increased compensation-related expense of $2.2 million, litigation related costs, which increased $1.8 million and additional allowances for bad debt of $0.9 million. General and administrative expense decreased as a percentage of revenue to 11.8% for the three months ended May 31, 2011 from 12.6% for the three months ended May 31, 2010 as we continued to leverage our corporate functions.
Read the The complete Report
