Red Hat growth defies economic downturn

Punchy open source vendor Red Hat has edged closer to its goal of becoming a $1bn (£671m) a year business after finishing off its fiscal 2009 with a double digit growth spurt. The firm has posted an 18% rise in sales to $196m (£131m) for its fiscal Q4 ended 28 February with profits up n

Punchy open source vendor Red Hat has edged closer to its goal of becoming a $1bn (£671m) a year business after finishing off its fiscal 2009 with a double digit growth spurt.

The firm has posted an 18% rise in sales to $196m (£131m) for its fiscal Q4 ended 28 February with profits up nearly 43% to $24.6m (£16.5m). For the year, revenue grew 15% to $782m and profits climbed 10% to $87.2m.

Jim Whitehurst, CEO at Red Hat said in a teleconference with analysts that it had "clearly gained market share and wallet share in a very challenging global economy".

The platform business showed resilience and middleware held up he said, as it saw continued growth in core verticals; financial services; government; tech media and the telecommunication sector, which finally returned to growth.

In the face of the recession, RedHat grew its sales headcount 13% and expanded marketing campaigns to drive adoption in sectors including logistics, oil and gas, retail, transport, energy and pharmaceuticals.

"We experienced over 150% growth within these mainstream verticals in our top deals compared with last year," said Whitehurst.

The channel represented 56% of total sales in Q4 compared to 62% in Q3, "Our direct sales team had an impressive Q4 with a number of large deals," said Whitehurst.

Twenty four of its top twenty five customers renewed during the quarter and subscription revenues were up 21% to $169.2m.

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