Red Hat reports sales leap

Red Hat has posted a big sales increase for the second quarter, but net profits are down.

Total sales for the quarter were $99.7m (£53.8m), up 52% on the same period last year.

Licence revenue was $84.9m, up 56% from a year ago, said Red Hat. The company recently acquired JBoss, and sales related to that company were $7m – above previous financial guidance offered by management. But net profits fell to $11m, compared to the $16.7m posted in the same quarter last year.

Red Hat said this was down to “differences in the accounting treatment for taxes and stock compensation expense between fiscal 2006 and 2007”.

It said net profits actually rose when these changes were taken out of the equation.

Charlie Peters, Red Hat’s chief financial officer, said, “We expect operating results and cashflow will improve in the second half of fiscal 2007 since much of the heavy [JBoss] integration work is already behind us.”