Red Hat Profit Soars But Revenue Misses Street View
December 26, 2004 Leave a comment
Red Hat recently released their numbers for the quarter. Revenue jumped 55 percent, but came in just shy of Wall Street's expectations on a net income of $10.8 million, or 6 cents a share. Total subscription and services revenue grew to $50.9 million from $32.9 million, also slightly below Wall Street's estimate. Subscription revenue climbed 80 percent to $39.2 million from $21.8 million. Good to see that Red Hat is able to continue to increase revenue, but with the current pricing structure you have to wonder how long it will be until Red Hat is the niche player (in the high end server market) and no longer the market leader. One has to wonder, 1) Do they care if this happens and 2) Could they sustain the current trends if they no longer were the market leader. I haven't seen any response to the recent call to cut prices and I still haven't heard of any plans to re-enter the consumer market, but this is definitely a topic I'll keep a close eye on.