-
Fourth quarter revenue of $400 million, up 15% year-over-year; full
fiscal year revenue of $1.53 billion, up 15% year-over-year
-
Fourth quarter subscription revenue of $351 million, up 16%
year-over-year; full fiscal year subscription revenue of $1.34
billion, up 16% year-over-year
-
Fourth quarter operating cash flow of $185 million, up 35%
year-over-year; full fiscal year operating cash flow of $541 million,
up 16% year-over-year
-
Year-end deferred revenue balance of $1.29 billion, up 18%
year-over-year
RALEIGH, N.C.--(BUSINESS WIRE)--
Red Hat, Inc. (NYSE: RHT), the world's leading provider of open source
solutions, today announced financial results for its fiscal fourth
quarter and fiscal year ended February 28, 2014.
Total revenue for the quarter was $400 million, an increase of 15% in
U.S. dollars from the year ago quarter, or 17% measured in constant
currency. Constant currency references in this release are as detailed
in the tables below. Subscription revenue for the quarter was $351
million, up 16% in U.S. dollars year-over-year, or 18% measured in
constant currency. For the full fiscal year, total revenue was $1.53
billion, up 15% in U.S. dollars year-over-year, or 17% measured in
constant currency, and subscription revenue was $1.34 billion, up 16% in
U.S. dollars year-over-year, or 18% measured in constant currency.
"The fourth quarter was a strong finish to fiscal 2014, and it was
highlighted by a record number of deals over $1 million and 24% growth
in our billings proxy to $565 million," stated Jim Whitehurst, President
and Chief Executive Officer of Red Hat. "Continued strong demand for Red
Hat's technology portfolio drove strong growth in our core platform and
application development technologies during the fourth quarter. In
addition, our cross-selling efforts resulted in early wins for our
emerging technologies, which address top CIO priorities that are driving
the evolution of enterprise computing."
GAAP operating income for the fourth quarter and the full fiscal year
was $59 million and $232 million, respectively. GAAP operating margin
was 14.8% in the fourth quarter and 15.1% for the full year. After
adjusting for stock compensation, amortization expenses and certain
facility exit costs, as detailed in the tables below, non-GAAP operating
income for the quarter was $97 million, or a 24.3% operating margin.
Full year non-GAAP operating income was $376 million and full year
non-GAAP operating margin was 24.5%.
GAAP net income for the fourth quarter was $45 million, or $0.24 per
diluted share, compared with $52 million, or $0.27 per diluted share,
for the prior quarter and $43 million, or $0.22 per diluted share, in
the year ago quarter. Non-GAAP adjusted net income for the fourth
quarter was $75 million, or $0.39 per diluted share, after adjusting for
stock compensation, amortization expenses and certain facility exit
costs, as detailed in the tables below. This compares to non-GAAP
adjusted net income of $81 million, or $0.42 per diluted share in the
prior quarter, and $70 million, or $0.36 per diluted share in the year
ago quarter.
For the full year, GAAP net income was $178 million or $0.93 per diluted
share, compared with $150 million or $0.77 per diluted share in the
prior year. After adjusting for stock compensation, amortization
expenses and certain facility exit costs, as detailed in the tables
below, non-GAAP adjusted net income for the year was $285 million or
$1.49 per diluted share, compared to $240 million or $1.23 per diluted
share for the previous fiscal year. For fiscal year 2014, Red Hat fully
diluted shares outstanding were approximately 192.0 million for the full
fiscal year, lower by 3.8 million shares due in part to the repurchase
of approximately 5.0 million shares, or approximately $239 million of
common stock during the year.
Operating cash flow totaled $185 million for the fourth quarter and $541
million for the full year. At the end of the fiscal year, the company's
total deferred revenue balance was $1.29 billion, an increase of 18% on
a year-over-year basis and 15% sequentially. Cash and investments at
February 28, 2014 totaled $1.49 billion.
"We delivered consistent mid-teen revenue growth during every quarter in
fiscal year 2014, and we continued to invest in new technologies and
commercial capabilities that further expand our future growth
opportunities in open hybrid cloud computing," stated Charlie Peters,
Executive Vice President and Chief Financial Officer of Red Hat. "Red
Hat continues to deliver a compelling combination of revenue growth,
profitability and cash flow. Our annual non-GAAP operating income growth
of 15% contributed to operating cash flow of $541 million for fiscal
year 2014, up 16% year-over-year, which included a record quarterly
operating cash flow of $185 million the fourth quarter, up 35%
year-over-year."
The billings proxy, which we define as total revenue plus the change in
deferred revenue as reflected on the Consolidated Statement of Cash
Flows, was $1.74 billion for fiscal year 2014 compared with $1.49
billion for the prior fiscal year, an increase of 17%. Total backlog for
fiscal year 2014 was in excess of $1.56 billion, up 14% year-over-year.
We define total backlog as the value of non-cancellable subscription and
service contracts, including total deferred revenue, which is billed,
plus the value of customer contracts to be billed in the future not
reflected in our financial statements. The portion of total backlog to
be billed in the future not reflected in our financial statements was in
excess of $270 million as of February 28, 2014, compared with the in
excess of $280 million ending balance reported for fiscal year 2013. The
portion of the total backlog to be billed in the next twelve months not
reflected in our financial statements was in excess of $190 million as
of February 28, 2014, compared with in excess of $180 million for the
fiscal year ending February 28, 2013.
Additional information on Red Hat's reported results, including a
reconciliation of the non-GAAP adjusted results, are included in the
financial tables below. A live webcast of Red Hat's results will begin
at 5:00 pm ET today and can be accessed by the general public at Red
Hat's investor relations website at http://investors.redhat.com.
A replay of the webcast will be available shortly after the live event
has ended.
Connect with Red Hat
About Red Hat, Inc.
Red Hat is the world's leading provider of open source software
solutions, using a community-powered approach to reliable and
high-performing cloud, Linux, middleware, storage and virtualization
technologies. Red Hat also offers award-winning support, training, and
consulting services. As the connective hub in a global network of
enterprises, partners, and open source communities, Red Hat helps create
relevant, innovative technologies that liberate resources for growth and
prepare customers for the future of IT. Learn more at http://www.redhat.com.
Forward-Looking Statements
Certain statements contained in this press release may constitute
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Forward-looking statements
provide current expectations of future events based on certain
assumptions and include any statement that does not directly relate to
any historical or current fact. Actual results may differ materially
from those indicated by such forward-looking statements as a result of
various important factors, including: risks related to delays or
reductions in information technology spending; the effects of industry
consolidation; the ability of the Company to compete effectively; the
integration of acquisitions and the ability to market successfully
acquired technologies and products; uncertainty and adverse results in
litigation and related settlements; the inability to adequately protect
Company intellectual property and the potential for infringement or
breach of license claims of or relating to third party intellectual
property; the ability to deliver and stimulate demand for new products
and technological innovations on a timely basis; risks related to data
and information security vulnerabilities; ineffective management of, and
control over, the Company's growth and international operations;
fluctuations in exchange rates; and changes in and a dependence on key
personnel, as well as other factors contained in our most recent
Quarterly Report on Form 10-Q (copies of which may be accessed through
the Securities and Exchange Commission's website at http://www.sec.gov),
including those found therein under the captions "Risk Factors" and
"Management's Discussion and Analysis of Financial Condition and Results
of Operations". In addition to these factors, actual future performance,
outcomes, and results may differ materially because of more general
factors including (without limitation) general industry and market
conditions and growth rates, economic and political conditions,
governmental and public policy changes and the impact of natural
disasters such as earthquakes and floods. The forward-looking statements
included in this press release represent the Company's views as of the
date of this press release and these views could change. However, while
the Company may elect to update these forward-looking statements at some
point in the future, the Company specifically disclaims any obligation
to do so. These forward-looking statements should not be relied upon as
representing the Company's views as of any date subsequent to the date
of this press release.
Red Hat, Red Hat Enterprise Linux, the Shadowman logo, and JBoss are
trademarks of Red Hat, Inc., registered in the U.S. and other countries.
Linux® is the registered trademark of Linus Torvalds in the U.S. and
other countries.
RED HAT, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In
thousands - except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Twelve Months Ended
|
|
|
|
|
|
February 28,
|
|
February 28,
|
|
|
February 28,
|
|
February 28,
|
|
|
|
|
|
2014
|
|
2013
|
|
|
2014
|
|
2013 (1)
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subscriptions
|
|
$351,492
|
|
$302,783
|
|
|
$1,336,771
|
|
$1,148,341
|
|
Training and services
|
|
48,905
|
|
45,101
|
|
|
197,844
|
|
180,476
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total subscription, training and services revenue
|
|
400,397
|
|
347,884
|
|
|
1,534,615
|
|
1,328,817
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subscriptions
|
|
25,663
|
|
22,400
|
|
|
97,100
|
|
80,340
|
|
Training and services
|
|
34,873
|
|
31,203
|
|
|
135,500
|
|
120,260
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total cost of subscription, training and services revenue
|
|
60,536
|
|
53,603
|
|
|
232,600
|
|
200,600
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total gross profit
|
|
339,861
|
|
294,281
|
|
|
1,302,015
|
|
1,128,217
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expense:
|
|
|
|
|
|
|
|
|
|
|
Sales and marketing
|
|
157,317
|
|
136,314
|
|
|
597,885
|
|
514,554
|
|
Research and development
|
|
82,644
|
|
71,248
|
|
|
317,263
|
|
263,150
|
|
General and administrative
|
|
40,600
|
|
36,487
|
|
|
152,407
|
|
146,333
|
|
Facility exit costs
|
|
-
|
|
-
|
|
|
2,171
|
|
3,142
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expense
|
|
280,561
|
|
244,049
|
|
|
1,069,726
|
|
927,179
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from operations
|
|
59,300
|
|
50,232
|
|
|
232,289
|
|
201,038
|
|
Interest income
|
|
2,037
|
|
1,861
|
|
|
6,645
|
|
8,245
|
|
Other income (expense), net
|
|
283
|
|
(34)
|
|
|
614
|
|
469
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision for income taxes
|
|
61,620
|
|
52,059
|
|
|
239,548
|
|
209,752
|
|
Provision for income taxes
|
|
16,551
|
|
9,086
|
|
|
61,256
|
|
59,548
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$45,069
|
|
$42,973
|
|
|
$178,292
|
|
$150,204
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per share:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
$0.24
|
|
$0.22
|
|
|
$0.94
|
|
$0.78
|
|
Diluted
|
|
|
|
$0.24
|
|
$0.22
|
|
|
$0.93
|
|
$0.77
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
189,604
|
|
193,207
|
|
|
189,920
|
|
193,147
|
|
Diluted
|
|
|
|
191,712
|
|
195,133
|
|
|
192,036
|
|
195,804
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Derived from audited financial statements
|
|
|
|
|
|
|
|
|
|
RED HAT, INC.
CONSOLIDATED BALANCE SHEETS
(In
thousands)
|
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
February 28,
|
|
February 28,
|
|
|
|
|
|
2014
|
|
2013 (1)
|
|
|
|
|
|
(Unaudited)
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash equivalents
|
|
$646,742
|
|
|
$487,084
|
|
|
Investments in debt and equity securities
|
|
335,387
|
|
|
392,381
|
|
|
Accounts receivable, net
|
|
360,594
|
|
|
302,942
|
|
|
Deferred tax assets, net
|
|
108,264
|
|
|
88,765
|
|
|
Prepaid expenses
|
|
118,387
|
|
|
94,421
|
|
|
Other current assets
|
|
1,808
|
|
|
3,156
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
1,571,182
|
|
|
1,368,749
|
|
|
|
|
|
|
|
|
|
|
Property and equipment, net
|
|
173,917
|
|
|
141,586
|
|
|
Goodwill
|
|
|
687,430
|
|
|
690,911
|
|
|
Identifiable intangibles, net
|
|
133,399
|
|
|
142,243
|
|
|
Investments in debt securities
|
|
505,300
|
|
|
438,908
|
|
|
Other assets, net
|
|
35,391
|
|
|
31,263
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
$3,106,619
|
|
|
$2,813,660
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
Current liabilities:
|
|
|
|
|
|
Accounts payable and accrued expenses
|
|
$179,468
|
|
|
$154,202
|
|
|
Deferred revenue
|
|
966,832
|
|
|
830,486
|
|
|
Other current obligations
|
|
1,786
|
|
|
1,024
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities
|
|
1,148,086
|
|
|
985,712
|
|
|
|
|
|
|
|
|
|
|
Long term deferred revenue
|
|
322,365
|
|
|
259,466
|
|
|
Other long term obligations
|
|
85,003
|
|
|
48,321
|
|
|
Stockholders' equity:
|
|
|
|
|
|
Common stock
|
|
23
|
|
|
23
|
|
|
Additional paid-in capital
|
|
1,891,848
|
|
|
1,802,899
|
|
|
Retained earnings
|
|
720,172
|
|
|
541,880
|
|
|
Treasury stock, at cost
|
|
(1,056,419
|
)
|
|
(816,674
|
)
|
|
Accumulated other comprehensive loss
|
|
(4,459
|
)
|
|
(7,967
|
)
|
|
|
|
|
|
|
|
|
|
Total stockholders' equity
|
|
1,551,165
|
|
|
1,520,161
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and stockholders' equity
|
|
$3,106,619
|
|
|
$2,813,660
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Derived from audited financial statements
|
|
|
|
|
RED HAT, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Twelve Months Ended
|
|
|
|
|
February 28,
|
|
February 28,
|
|
|
February 28,
|
|
February 28,
|
|
|
|
|
2014
|
|
2013
|
|
|
2014
|
|
2013 (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$45,069
|
|
|
$42,973
|
|
|
|
$178,292
|
|
|
$150,204
|
|
|
Adjustments to reconcile net income to net cash provided by
|
|
|
|
|
|
|
|
|
|
|
operating activities:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
19,079
|
|
|
17,568
|
|
|
|
74,405
|
|
|
62,341
|
|
|
Share-based compensation expense
|
|
30,578
|
|
|
25,954
|
|
|
|
113,774
|
|
|
98,698
|
|
|
Deferred income taxes
|
|
7,934
|
|
|
10,101
|
|
|
|
26,613
|
|
|
39,849
|
|
|
Excess tax benefits from share-based payment arrangements
|
|
(3,766
|
)
|
|
(6,319
|
)
|
|
|
(12,837
|
)
|
|
(34,219
|
)
|
|
Net amortization of bond premium on available-for-sale debt
securities
|
|
2,060
|
|
|
1,795
|
|
|
|
8,697
|
|
|
6,889
|
|
|
Other
|
|
|
926
|
|
|
(233
|
)
|
|
|
1,411
|
|
|
(2,626
|
)
|
|
Changes in operating assets and liabilities net of effects of
acquisitions:
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable
|
|
(52,536
|
)
|
|
(47,447
|
)
|
|
|
(61,785
|
)
|
|
(46,913
|
)
|
|
Prepaid expenses
|
|
(21,619
|
)
|
|
(10,411
|
)
|
|
|
(25,122
|
)
|
|
(14,726
|
)
|
|
Accounts payable and accrued expenses
|
|
(10,129
|
)
|
|
(2,612
|
)
|
|
|
28,436
|
|
|
40,196
|
|
|
Deferred revenue
|
|
164,358
|
|
|
106,059
|
|
|
|
205,357
|
|
|
162,574
|
|
|
Other
|
|
|
2,728
|
|
|
(541
|
)
|
|
|
3,339
|
|
|
3,030
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by operating activities
|
|
184,682
|
|
|
136,887
|
|
|
|
540,580
|
|
|
465,297
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
Purchase of available-for-sale debt securities
|
|
(324,029
|
)
|
|
(244,341
|
)
|
|
|
(772,741
|
)
|
|
(875,428
|
)
|
|
Proceeds from sales and maturities of available-for-sale debt
securities
|
|
166,271
|
|
|
153,779
|
|
|
|
764,122
|
|
|
741,301
|
|
|
Acquisition of business, net of cash acquired
|
|
-
|
|
|
(104,262
|
)
|
|
|
-
|
|
|
(135,501
|
)
|
|
Purchase of other intangible assets
|
|
(4,769
|
)
|
|
(1,927
|
)
|
|
|
(17,972
|
)
|
|
(34,367
|
)
|
|
Purchase of property and equipment
|
|
(17,754
|
)
|
|
(21,119
|
)
|
|
|
(79,587
|
)
|
|
(85,671
|
)
|
|
Other
|
|
|
-
|
|
|
353
|
|
|
|
(2,084
|
)
|
|
617
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in investing activities
|
|
(180,281
|
)
|
|
(217,517
|
)
|
|
|
(108,262
|
)
|
|
(389,049
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
Excess tax benefits from share-based payment arrangements
|
|
3,766
|
|
|
6,319
|
|
|
|
12,837
|
|
|
34,219
|
|
|
Proceeds from exercise of common stock options
|
|
811
|
|
|
668
|
|
|
|
2,122
|
|
|
11,478
|
|
|
Purchase of treasury stock
|
|
-
|
|
|
(35,761
|
)
|
|
|
(239,363
|
)
|
|
(120,662
|
)
|
|
Payments related to net settlement of employee share-based
compensation awards
|
|
(4,280
|
)
|
|
(4,373
|
)
|
|
|
(37,402
|
)
|
|
(49,984
|
)
|
|
Payments on other borrowings
|
|
(325
|
)
|
|
(335
|
)
|
|
|
(1,304
|
)
|
|
(1,016
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in financing activities
|
|
(28
|
)
|
|
(33,482
|
)
|
|
|
(263,110
|
)
|
|
(125,965
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of foreign currency exchange rates on cash and cash
equivalents
|
|
258
|
|
|
(4,715
|
)
|
|
|
(9,550
|
)
|
|
(12,416
|
)
|
|
Net increase (decrease) in cash and cash equivalents
|
|
4,631
|
|
|
(118,827
|
)
|
|
|
159,658
|
|
|
(62,133
|
)
|
|
Cash and cash equivalents at beginning of the period
|
|
642,111
|
|
|
605,911
|
|
|
|
487,084
|
|
|
549,217
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period
|
|
$646,742
|
|
|
$487,084
|
|
|
|
$646,742
|
|
|
$487,084
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Derived from audited financial statements
|
|
|
|
|
|
|
|
|
|
|
RED HAT, INC.
|
|
RECONCILIATION OF CERTAIN GAAP RESULTS TO NON-GAAP ADJUSTED
RESULTS
|
|
(Unaudited)
|
|
(In thousands - except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non cash share-based compensation expense included in Consolidated
Statements of Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Twelve Months Ended
|
|
|
February 28,
|
|
February 28,
|
|
February 28,
|
|
February 28,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue
|
$2,932
|
|
$2,656
|
|
$11,793
|
|
$9,433
|
|
Sales and marketing
|
10,313
|
|
8,944
|
|
40,322
|
|
32,906
|
|
Research and development
|
9,094
|
|
7,606
|
|
34,194
|
|
29,647
|
|
General and administration
|
8,239
|
|
6,748
|
|
27,465
|
|
26,712
|
|
Total share-based compensation expense
|
$30,578
|
|
$25,954
|
|
$113,774
|
|
$98,698
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of intangible assets expense included in Consolidated
Statements of Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Twelve Months Ended
|
|
|
February 28,
|
|
February 28,
|
|
February 28,
|
|
February 28,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue
|
$2,508
|
|
$2,695
|
|
$10,180
|
|
$5,943
|
|
Sales and marketing
|
2,477
|
|
2,144
|
|
8,872
|
|
8,416
|
|
Research and development
|
959
|
|
959
|
|
3,836
|
|
3,836
|
|
General and administration
|
1,288
|
|
1,528
|
|
5,316
|
|
5,328
|
|
Total amortization of intangible assets expense
|
$7,232
|
|
$7,326
|
|
$28,204
|
|
$23,523
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Facility exit costs included in Consolidated Statements of
Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Twelve Months Ended
|
|
|
February 28,
|
|
February 28,
|
February 28,
|
|
February 28,
|
|
|
2014
|
|
2013
|
2014
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
Facility exit costs
|
-
|
|
-
|
|
$2,171
|
|
$3,142
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Twelve Months Ended
|
|
|
February 28,
|
|
February 28,
|
|
February 28,
|
|
February 28,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
GAAP net income
|
$45,069
|
|
$42,973
|
|
$178,292
|
|
$150,204
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes
|
16,551
|
|
9,086
|
|
61,256
|
|
59,548
|
|
|
|
|
|
|
|
|
|
|
GAAP income before provision for income taxes
|
$61,620
|
|
$52,059
|
|
$239,548
|
|
$209,752
|
|
|
|
|
|
|
|
|
|
|
Add: Non-cash share-based compensation expense
|
30,578
|
|
25,954
|
|
113,774
|
|
98,698
|
|
Add: Amortization of intangible assets
|
7,232
|
|
7,326
|
|
28,204
|
|
23,523
|
|
Add: Facility exit costs
|
-
|
|
-
|
|
2,171
|
|
3,142
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjusted income before provision for income taxes
|
$99,430
|
|
$85,339
|
|
$383,697
|
|
$335,115
|
|
|
|
|
|
|
|
|
|
|
Provision for income taxes (1)
|
24,277
|
|
15,213
|
|
98,226
|
|
95,139
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjusted net income (basic and diluted)
|
$75,153
|
|
$70,126
|
|
$285,471
|
|
$239,976
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjusted net income per share:
|
|
|
|
|
|
|
|
|
Basic
|
$0.40
|
|
$0.36
|
|
$1.50
|
|
$1.24
|
|
Diluted
|
$0.39
|
|
$0.36
|
|
$1.49
|
|
$1.23
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Provision for income taxes:
|
|
|
|
|
|
|
|
|
Non-GAAP adjusted net income before income tax provision
|
$99,430
|
|
$85,339
|
|
$383,697
|
|
$335,115
|
|
Effective tax rates, excluding discrete tax items
|
24.4%
|
|
17.8%
|
|
26.7%
|
|
28.4%
|
|
Non-GAAP provision for income taxes before discrete tax benefit
|
$24,277
|
|
$15,213
|
|
$102,451
|
|
$95,139
|
|
Discrete tax benefit
|
-
|
|
-
|
|
4,225
|
|
-
|
|
Provision for income taxes on Non-GAAP adjusted net income
|
$24,277
|
|
$15,213
|
|
$98,226
|
|
$95,139
|
RED HAT, INC.
RECONCILIATION OF CERTAIN GAAP RESULTS
TO NON-GAAP ADJUSTED RESULTS
(Unaudited)
(In thousands
- except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP results to non-GAAP adjusted results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Twelve Months Ended
|
|
|
|
February 28,
|
|
|
February 28,
|
|
|
February 28,
|
|
|
February 28,
|
|
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP gross profit
|
|
$339,861
|
|
|
$294,281
|
|
|
$1,302,015
|
|
|
$1,128,217
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add: Non-cash share-based compensation expense
|
|
2,932
|
|
|
2,656
|
|
|
11,793
|
|
|
9,433
|
|
Add: Amortization of intangible assets
|
|
2,508
|
|
|
2,695
|
|
|
10,180
|
|
|
5,943
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP gross profit
|
|
$345,301
|
|
|
$299,632
|
|
|
$1,323,988
|
|
|
$1,143,593
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP gross margin
|
|
86%
|
|
|
86%
|
|
|
86%
|
|
|
86%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Twelve Months Ended
|
|
|
|
February 28,
|
|
|
February 28,
|
|
|
February 28,
|
|
|
February 28,
|
|
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating expenses
|
|
$280,561
|
|
|
$244,049
|
|
|
$1,069,726
|
|
|
$927,179
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deduct: Non-cash share-based compensation expense
|
|
(27,646)
|
|
|
(23,298)
|
|
|
(101,981)
|
|
|
(89,265)
|
|
Deduct: Amortization of intangible assets
|
|
(4,724)
|
|
|
(4,631)
|
|
|
(18,024)
|
|
|
(17,580)
|
|
Deduct: Facility exit costs
|
|
-
|
|
|
-
|
|
|
(2,171)
|
|
|
(3,142)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjusted operating expenses
|
|
$248,191
|
|
|
$216,120
|
|
|
$947,550
|
|
|
$817,192
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
Twelve Months Ended
|
|
|
|
February 28,
|
|
|
February 28,
|
|
|
February 28,
|
|
|
February 28,
|
|
|
|
2014
|
|
|
2013
|
|
|
2014
|
|
|
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating income
|
|
$59,300
|
|
|
$50,232
|
|
|
$232,289
|
|
|
$201,038
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add: Non-cash share-based compensation expense
|
|
30,578
|
|
|
25,954
|
|
|
113,774
|
|
|
98,698
|
|
Add: Amortization of intangible assets
|
|
7,232
|
|
|
7,326
|
|
|
28,204
|
|
|
23,523
|
|
Add: Facility exit costs
|
|
-
|
|
|
-
|
|
|
2,171
|
|
|
3,142
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjusted operating income
|
|
$97,110
|
|
|
$83,512
|
|
|
$376,438
|
|
|
$326,401
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjusted operating margin
|
|
24.3%
|
|
|
24.0%
|
|
|
24.5%
|
|
|
24.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of constant currency revenue growth rates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
|
|
|
February 28,
|
|
|
February 28,
|
|
|
Year-Over-Year
|
|
|
|
|
|
|
2014
|
|
|
2013
|
|
|
Growth Rate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP subscription revenue
|
|
$351,492
|
|
|
$302,783
|
|
|
16.1%
|
|
|
|
|
Adjustment for currency impact
|
|
4,991
|
|
|
-
|
|
|
|
|
|
|
|
Non-GAAP subscription revenue on a constant currency basis
|
|
$356,483
|
|
|
$302,783
|
|
|
17.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP training and services revenue
|
|
$48,905
|
|
|
$45,101
|
|
|
8.4%
|
|
|
|
|
Adjustment for currency impact
|
|
1,455
|
|
|
-
|
|
|
|
|
|
|
|
Non-GAAP training and services revenue on a constant currency basis
|
|
$50,360
|
|
|
$45,101
|
|
|
11.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP total subscription, training and services revenue
|
|
$400,397
|
|
|
$347,884
|
|
|
15.1%
|
|
|
|
|
Adjustment for currency impact
|
|
6,446
|
|
|
-
|
|
|
|
|
|
|
|
Non-GAAP total subscription, training and services revenue on a
constant currency basis
|
|
$406,843
|
|
|
$347,884
|
|
|
16.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended
|
|
|
|
|
|
|
|
|
|
February 28,
|
|
|
February 28,
|
|
|
Year-Over-Year
|
|
|
|
|
|
|
2014
|
|
|
2013
|
|
|
Growth Rate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP subscription revenue
|
|
$1,336,771
|
|
|
$1,148,341
|
|
|
16.4%
|
|
|
|
|
Adjustment for currency impact
|
|
18,059
|
|
|
-
|
|
|
|
|
|
|
|
Non-GAAP subscription revenue on a constant currency basis
|
|
$1,354,830
|
|
|
$1,148,341
|
|
|
18.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP training and services revenue
|
|
$197,844
|
|
|
$180,476
|
|
|
9.6%
|
|
|
|
|
Adjustment for currency impact
|
|
3,342
|
|
|
-
|
|
|
|
|
|
|
|
Non-GAAP training and services revenue on a constant currency basis
|
|
$201,186
|
|
|
$180,476
|
|
|
11.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP total subscription, training and services revenue
|
|
$1,534,615
|
|
|
$1,328,817
|
|
|
15.5%
|
|
|
|
|
Adjustment for currency impact
|
|
21,401
|
|
|
-
|
|
|
|
|
|
|
|
Non-GAAP total subscription, training and services revenue on a
constant currency basis
|
|
$1,556,016
|
|
|
$1,328,817
|
|
|
17.1%
|
|
|
|
Red Hat, Inc.
Media Contact:
Stephanie Wonderlick,
571-421-8169
swonderl@redhat.com
or
Investor
Relations:
Tom McCallum, 919-754-4630
tmccallum@redhat.com
Source: Red Hat, Inc.
News Provided by Acquire Media