ECONOMY

Red Hat beats 3Q profit views, misses revenue forecasts

Shares in Red Hat Inc. fell sharply in after-hours trading Wednesday after the open-source software company reported quarterly revenue that fell short of Wall Street expectations.

The company's forecast for revenue in the current quarter also fell short of forecasts and it announced its chief financial officer is leaving.

Its stock was down almost 11 percent in extended trading.

The Raleigh, North Carolina-based company posted a fiscal third-quarter profit of $67.9 million, or 37 cents per share. Earnings, adjusted for one-time gains and costs, were 61 cents per share.

That topped Wall Street expectations. The average estimate of 14 analysts surveyed by Zacks Investment Research was for earnings of 58 cents per share.

But it posted revenue of $615.3 million in the period. Eleven analysts surveyed by Zacks expected $618.5 million.

For the current quarter ending in February, Red Hat expects its adjusted per-share earnings to be 61 cents.

The company said it expects revenue in the range of $614 million to $622 million for the fiscal fourth quarter. Analysts surveyed by Zacks had expected revenue of $638.4 million.

Red Hat expects full-year adjusted earnings to be $2.27 per share, with revenue in a range of $2.4 billion to $2.41 billion.

The company also said that Frank Calderoni will step down as executive vice president, operations, and chief financial officer in late January to take on the CEO post at another unnamed company. Calderoni joined the company in June 2015 after stints at Cisco Systems and IBM.

Red Hat plans to name Eric Shander as CFO, pending a decision on a permanent replacement. Shander is Red Hat's vice president, finance and accounting and its principal accounting officer.

Red Hat shares have dropped almost 4 percent since the beginning of the year, while the Standard & Poor's 500 index has risen 11 percent.

Following its earnings report after the close of regular-session trading on Wall Street, the stock slid 48.64 to $71.15.

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Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on RHT at https://www.zacks.com/ap/RHT

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Keywords: Red Hat, Earnings Report