What does a good soldier do when he's outnumbered and outmaneuvered? He calls in reinforcements, of course. That's why Red Hat (NYSE: RHT - News) is beefing up its troops for the coming campaign, at the expense of giving up some ground today.
Red Hat's quarter doesn't look great on the surface, apart from that 44.7% year-over-year revenue spike. Net and operating margins were cut in half, and earnings per share dropped from $0.12 last year to $0.07 this time around. On top of that, half-ton gorillas like Oracle (NASDAQ: ORCL - News) and Microsoft (NASDAQ: MSFT - News) started flexing their big, hairy biceps at the
Linux expert this quarter, with the help of smaller open-source outfits like Novell (NASDAQ: NOVL - News). Oh my.
But Red Hat isn't running scared, at least not publicly. CEO Matthew Szulik spake thusly about the competitive situation:
"We believe recent competitive announcements are expanding the market for open-source software. And based on this quarter's strong bookings, billings, and revenue, we are optimistic that our long-term competitive positioning is being enhanced by the market participation of larger entrants."
