Red Hat reported revenue of $879 million for the fourth quarter of its fiscal year, up 14% year-over-year, or 17% in constant currency. Full fiscal year total revenue amounted to $3.4 billion, up 15% year-over-year, or 16% in constant currency. GAAP net income for the quarter was $139 million, or $0.75 diluted earnings per share (“EPS”), compared with GAAP net loss of $12 million, or $0.07 diluted loss per share, in the year-ago quarter. The year-ago quarter included a one-time tax charge of $123 million related to the Tax Cuts and Jobs Act enacted into law in December 2017.
Subscription revenue for the quarter was $774 million, up 13% year-over-year, or 16% measured in constant currency. Subscription revenue in the quarter was 88% of total revenue.
IBM bets $34 billion on Red Hat as its pathway to multi-cloud
IBM agreed to acquire all of the issued and outstanding common shares of Red Hat for $190.00 per share in cash, representing a total enterprise value of approximately $34 billion.
IBM and Red Hat said that as a combined company tthey will be strongly positioned to address the migration of all businesses to multi-cloud environments in an open and secure way. They estimate that 80% of business workloads have yet to move to the cloud. The merger will draw on their shared leadership in key technologies, such as Linux, containers, Kubernetes, multi-cloud management, and cloud management and automation
IBM was an early supporter of Linux, collaborating with Red Hat to help develop and grow enterprise-grade Linux and more recently to bring enterprise Kubernetes and hybrid cloud solutions to customers.
IBM said it will remain committed to Red Hat’s open governance, open source contributions, participation in the open source community and development model, and fostering its widespread developer ecosystem. It also promises to build and enhance Red Hat partnerships, including those with major cloud providers, such as Amazon Web Services, Microsoft Azure, Google Cloud, Alibaba and more, in addition to the IBM Cloud.
