Red Hat revealed its fourth quarter 2015 financial this week, reporting revenue of $464m, up 16 per cent year-on-year. The firm also said deals involving OpenStack and OpenShift-based offerings tripled when compared to the fourth quarter 2014.
For the full fiscal year total revenue hit $1.79bn, up 17 per cent on the previous year, and the Linux incumbent reported subscription revenue for the quarter reached $405m, up 15 per cent year-on-year.
“We continued to experience strong demand for our open, hybrid cloud technologies, as evidenced by increased cross-selling in our top 30 deals which were all over $2 million for the first time,” stated Jim Whitehurst, president and chief executive officer of Red Hat. “Customers value the consistency and flexibility as they run their applications using Red Hat solutions across a variety of deployment models, including public and private clouds, to modernize and transform their IT infrastructure.”
In a call with analysts this week Whitehurst also said its OpenStack and OpenShift offerings, as well as Ceph – the storage system provider it acquired last year – are starting to show signs of market acceptance.
“Half of our OpenStack wins are six figure OpenStack wins in the quarter had Ceph as a component. So fully strong affinity between OpenStack and Ceph and our ability to be a credible provider of both, I think helps us do well in both. So we’re seeing a lot of benefit there.”
“The number of times the top 30 deal included OpenStack or OpenShift this quarter tripled from Q4 a year ago. Interestingly, one technology customer expanded their existing OpenShift deal this quarter and we now have our first $10 million plus open shift customer,” he said. “OpenShift has been performing well with customers and momentum is growing.”
OpenShift is currently pitted in a battle for mindshare against Cloud Foundry, another open source platform as a service. Cloud Foundry seems to have gained the lion’s share of vendor buy-in, but Paul Cormier, Red Hat’s executive vice president, products and technology said OpenShift wins over Cloud Foundry when it comes to standards.
“One of the biggest differences is that cloud foundry from the various vendors is it’s very difficult in implementation. So getting applications that are compatible across those different vendors on Cloud Foundry will be challenging for one thing,” he said, adding that OpenShift relies on more tried-and-tested technology standards.
Red Hat enjoyed a solid fourth quarter and fiscal 2015, and it will be interesting to see how the incumbent attempts to keep that positive momentum going. Professional services may be one viable avenue. The company recently created a consulting division that combines technology expertise and consulting resources the firm acquired over the years.