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Some Intriguing Data Behind Red Hat's 29 Percent Growth

Sep 25, 2008, 22:03 (0 Talkback[s])
(Other stories by Matt Asay)

[ Thanks to Matt Asay for this link. ]

"This was the first time in years that Red Hat's second-quarter billings exceeded its first quarter billings. Not bad for a company that gives away free software.

"Importantly, Red Hat appears to be doing longer-term deals, as its total deferred revenue balance was $496.9 million, growing 32 percent year-over-year and 1 percent sequentially. This would suggest that Red Hat customers are increasingly comfortable making a long-term bet on Red Hat's future. Indeed, on the analyst call, Red Hat Chief Financial Officer Charlie Peters indicated that the average booking for Red Hat is 24 months and that 36 percent of its subscriptions are for a term greater than one year.

"In selling longer-term deals, Red Hat is successfully blocking competitive pressure from Novell, Microsoft, and other companies that might want to cut into its accounts."

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