- After growing only 8% Y/Y in FQ2, and 14% in FQ1, Red Hat's (RHT) billings rose 19% Y/Y in FQ3 to $453M. That figure is well above FQ3 revenue of $397M (+15%), which itself handily beat estimates.
- Subscription revenue (86% of total revenue) rose 17% Y/Y, even with FQ2. Training/services revenue rose 9%.
- Opex +14% Y/Y, with solid increases in sales/marketing, R&D, and SG&A spend. Gross margin was 86%, -100 bps Q/Q and flat Y/Y. $40M was spent on buybacks vs. $20M in FQ2 and $179M in FQ1.
- Linux's server share gains appear to be giving Red Hat a lift. So might the company's growing middleware business.
- CC at 5PM ET, guidance should be provided. FQ3 results, PR.
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