Red Hat (NYSE: RHT) stock fell hard Thursday, after the software company reported lower revenue than expected for the second quarter of its 2019 fiscal year, which ended on Aug. 31.
Earnings came in at 85 cents per share, excluding certain items, vs. 82 cents per share as expected by analysts, according to Thomson Reuters.
Revenue numbered around $822.7 million, vs. $830 million as expected.
Overall, Red Hat's revenue rose 14% year over year. The majority of that revenue comes from subscriptions — to distributions of the Linux open-source operating system and other products. Subscription revenue of $722.7 million was up 13%. Analysts had expected $724.1 million in subscription revenue.
Revenue from training and services was also behind what analysts were looking for, at $100 million, whereas estimates were for $104 million.
With respect to guidance for the fiscal third quarter, Red Hat is forecasting 87 cents per share, excluding certain items, on around $848 million to $856 million in revenue.
Analysts had expected guidance of 92 cents per share, excluding certain items, on $862.7 million in revenue for that period.
As for the full 2019 fiscal year, Red Hat said it lowered revenue estimates by $15 million specifically because of foreign-exchange rates.
It now looks to post $3.45 to $3.49 in earnings per share, excluding certain items, on $3.36 billion to 3.40 billion in revenue. Analysts were expecting full-year results of $3.47 in earnings per share, excluding certain items.
Shares in Red Hat tumbled $8.32, or 5.8% to $134.84
