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Red Hat profits beat Wall Street expectations

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Buoyed by a 29 percent jump in revenues, Red Hat (NYSE: RHT) reported a $21.1 million profit for the quarter ending Aug. 31.

The Linux software developer and solutions provider exceeded Wall Street analysts expectations with a 20-cent per share profit, excluding one-time costs and expenses. Analysts had forecast an 18-cent profit.

Overall, Red Hat revenues hit $164.4 million, up by 29 percent for the same quarter in 2007 and a 5 percent increase from the previous three months.

Red Hat shares closed at $18.01 Wednesday, up 6 cents. The stock moved up slightly even though analyst firm Jefferies & Company issued a report before the markets opened that cut its projected share price to $19 from $20 and warned Red Hat faced “Lots of Headwinds, a Few Tailwinds.”

Analyst Katherine Egbert expressed concerns about Red Hat’s recent acquisition of Qumranet, a developer of virtualization technology.

“Our focused execution has delivered another quarter of solid growth and financial results,“ said Red Hat Chief Executive Officer Jim Whitehurst in a statement.

“Also in Q2, we continued to execute on our virtualization strategy with our award winning [Red Hat Enterprise Linux] platform as the solid, certified foundation. Our goal is for Red Hat to deliver a comprehensive virtualization solution from server to desktop which will enable our customers to deploy any application, anywhere, anytime.”

Subscription revenue climbed 24 percent from a year earlier to $135.7 million.

Minus one-time charges and expenses, Red Hat’s profits were $21.1 million, or 10 cents per share.