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Ahead Of Red Hat's Q4 Results

Redhat EP 032116

Linux software maker Red Hat Inc.'s (RHT) investments in technologies and partnerships continue to generate strong results as customers transform their IT infrastructure through the increasing adoption of open source technologies and cloud computing.

During the third quarter, the company strengthened its leadership position in the open hybrid cloud by introducing new technologies and launching a strategic partnership with Microsoft and its Azure Cloud.

For the full year, the company raised its revenue target to a range of $2.044 billion - $2.048 billion from the previously communicated range of $2.034 billion - $2.044 billion. Full-year earnings per share is now projected to be $1.86 versus prior estimate of $1.85 - $1.87 per share. GAAP earnings per share is expected to be about $1.05.

Analysts polled by Thomson Reuters are estimating earnings of $1.86 per share on revenue of $2.05 billion for fiscal year ending February 2016. Analysts' estimate typically exclude certain special items.

Full-year GAAP operating margin is now expected to be about 14.1% and non-GAAP operating margin is expected to be about 23.5%.

For the fourth quarter, the company expects revenue in the range of $535 million - $539 million, GAAP earnings of $0.26 per share, and non-GAAP earnings of about $0.47 per share. GAAP operating margin is expected to be about 13.3% and non-GAAP operating margin is expected to be about 22.5%.

The company's fourth-quarter results are due to be released after the bell on Tuesday, March 22, with analysts estimating earnings of $0.47 per share on revenue of $537.20 million.

In the last quarter, the company reported GAAP net income of $47 million or $0.25 per share compared to $48 million or $0.26 per share in the year-ago quarter.

Non-GAAP net income for the third quarter was $89 million or $0.48 per share compared to $79 million or $0.42 per share in the prior year period.

Total revenue for the quarter was $524 million, up 15% in U.S. dollars year-over-year, or 21% measured in constant currency.

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