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Red Hat Q1 Earnings Call Transcript
Author: 123jump.com Staff
123jump.com
Last Update: 1:16 AM ET July 02 2009

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Red Hat first quarter rose 11% to $174 million with subscription revenue going up by 14%. Net income rose marginally to $18.5 million. Earnings per share were 15 cents as against 12 cents a year ago.


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Operator

Your next question comes from the line of Steve Ashley of Robert W. Baird. Your line is now open.

Steve Ashley – Robert W. Baird

Hi thanks for taking my question. Just getting back Jim to the question regarding the Sun/Oracle deal, do you have any idea what percentage of the business you do in any given period would be related to Oracle and Oracle software at this point.

Charlie Peters

Not really.

Steve Ashley – Robert W. Baird

Okay and then secondly in your prepared remarks Jim you talked about the cloud and cloud computing as being an important focus point, public and private clouds. Is that impacting demand today and manifesting as bookings here today?

Jim Whitehurst

At this point I wouldn’t say it’s a significant component of business, right and there’s a lot of talk, there’s a lot of work going on and our customers have asked us to do a lot for them. In terms of actual incremental dollars today, I don’t think a lot of companies are there yet.

Tom McCallum

Next question please

Operator

Your next question comes from the line of Aaron Schwartz of Ladenburg Thalmann. Your line is now open.

Aaron Schwartz – Ladenburg Thalmann

Good afternoon. You spend a lot of time talking about the opportunity with the free to paid conversions. Have you changed anything operationally to either incent your sales force or partners to more aggressively pursue those opportunities?

Charlie Peters

We have an internal team, a combination of folks in sales and in finance that work collaboratively to first of all identify opportunities and then determine the right course of action to help pursue the activities, whether it’s to make a sales call, help educate an existing customer about the position or potential customers about the value of a subscription. The teams are working together and work with our sales people. Yes, so we have done some things really in the last six months and tried to focus on this.

Jim Whitehurst

And there are a myriad of small activities from pulling together packages which we’re sending out to customers, to the sales force training, to the follow-ups to selected audits. It’s a whole program that’s marching forward.
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