Red Hat F2Q10 (Qtr End 8/31/09) Earnings Call Transcript

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2009-09-23 17:44:08.0

Tags: Goldman Sachs Group Inc., Red Hat Inc., Call Transcript, Earnings, Morgan Stanley, JBoss, Java Development Tools, Development Tools, Middleware, Open Source, Software Development, Software/Web Development, Enterprise Software, Software, Seeking Alpha

Question-and-Answer Session

Operator

(Operator Instructions) Our first question comes from the line of Sarah Friar with Goldman Sachs.

Sarah Friar – Goldman Sachs

Good quarter. Jim, if I could just ask you a little bit on the demand environment, some extra color -- did you actually see customers beginning to pick up on server purchases again or do you think you were benefiting from again taking share from other operating systems like Solaris, for example?

Jim Whitehurst

At this point, it still looks like taking share from other operating systems vendors. I would say we are seeing some signs of life out there as customers are talking a bit more about new projects but I don’t think we actually saw that in new volume in the second quarter. I think it’s mainly taking share still at this point.

Sarah Friar – Goldman Sachs

Got it, and then if I could just one follow-up on the geographical split, did you see anything coming back in EMEA? I know that’s been one geography that’s appeared to have lagged most and yet we are seeing some early signs that GDP is picking up there.

Jim Whitehurst

I think they made some progress and one interesting fact is they booked the largest deal in the history of EMEA in Q2.

Sarah Friar – Goldman Sachs

Okay, great. Thank you very much. Good job.

Operator

Your next question comes from the line of Adam Holt with Morgan Stanley.

Adam Holt – Morgan Stanley

I’ll echo the congratulations. My first question is on JBOSS. It sounded like you had good success, particularly with larger deals in JBOSS. Does this mean that you think that business is reaccelerated to be growing faster than the core business? And maybe talk about the pipeline for the second half there.

Jim Whitehurst

On the JBOSS business, it does continue to grow faster than the core business, and as I said in talking about the top 30 deals, there still seems to be a good cross-sell going on and when we have a REL account, we’re able to sell JBOSS there. And the second part of your question was on pipeline?

Adam Holt – Morgan Stanley

Yes, just the pipeline for the back half of the year for the JBOSS business.

Jim Whitehurst

I would say our pipelines overall remain good.

Adam Holt – Morgan Stanley

Terrific. Thank you.

Operator

Your next question comes from the line of Heather Bellini with ISI.

 

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