Red Hat, Inc. (NYSE: RHT), the world's leading provider of open source solutions, today announced financial results for its fiscal year 2009 second quarter ended August 31, 2008.

“Our focused execution has delivered another quarter of solid growth and financial results,“ stated Jim Whitehurst, President and Chief Executive Officer of Red Hat. “Also in Q2, we continued to execute on our virtualization strategy with our award winning RHEL 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.”

Total revenue for the quarter was $164.4 million, an increase of 29% from the year ago quarter and 5% from the prior quarter. Subscription revenue for the quarter was $135.7 million, up 24% year-over-year and 4% sequentially.

Net income for the quarter was $21.1 million, or $0.10 per diluted share, compared with $18.2 million, or $0.09 per diluted share, in the year ago quarter. Non-GAAP adjusted net income for the quarter was $43.2 million, or $0.20 per diluted share, after adjusting for stock compensation and tax expense as detailed in the tables below. This compares to non-GAAP adjusted net income of $36.9 million, or $0.17 per diluted share in the year ago quarter.

Operating cash flow totaled $54.3 million, compared to $49.2 million from the year ago quarter and $63.4 million from the prior quarter. At quarter end, the company’s total deferred revenue balance was $496.9 million, an increase of 32% on a year-over-year basis and 1% sequentially. Total cash, cash equivalents and investments as of August 31, 2008 were $1.4 billion.

Other highlights include the following:

• JBoss Enterprise Application Platform is now available along with Red Hat Enterprise Linux on the Amazon EC2 Cloud.
• Red Hat Enterprise Linux was named the 2008 Product of the Year by Channel Insider, in the Server Operating Systems category.
• Red Hat’s annual customer and user event, the Red Hat Summit, was held in Boston this year to record attendance.
• In early September, Red Hat announced the acquisition of Qumranet, Inc. which is expected to accelerate the time to market to deliver an expanded virtualization solution portfolio to the rapidly growing virtualization market. This acquisition increases Red Hat’s investment in and stewardship of core open source virtualization technology including KVM, the only hypervisor embedded in the Linux Kernel. The acquisition also establishes Red Hat in the nascent Virtual Desktop Infrastructure (VDI) market.

"Our performance this quarter demonstrated strong demand for our products and services, good execution, and the consistency of results afforded by our subscription business model,” stated Charlie Peters, Executive Vice President and Chief Financial Officer of Red Hat. “Key factors to our growth include the value message, the cost efficiencies of open source solutions and our world-class customer service.”

Additional information on Red Hat's reported results, including a reconciliation of the non-GAAP adjusted results, are included in the financial tables below. A live webcast of Red Hat's results will begin at 5:00 pm ET today and can be accessed by the general public at Red Hat's investor relations website at http://investors.redhat.com. A replay of the webcast will be available shortly after the live event will have ended.