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Red Hat CFO steps down, profit grows significantly

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Red Hat

Red Hat has announced that its Chief Financial Officer Frank Calderoni is stepping down in late January 2017. The new decision emerges at the time when the open source software company posted a 45 percent profit increase for the last quarter.

Calderoni is departing from his role to as executive vice president of operations and CFO to accept a chief executive officer position at an unnamed company. He joined Red Hat in June last year after serving as CFO at Cisco Systems.

“As we discussed, I have been given the opportunity to serve as the CEO of another company,” Calderoni writes in a letter to CEO Jim Whitehurst.

Red Hat is set to appoint Eric Shander, vice president of finance and accounting and principal accounting officer, as its interim CFO.

“Our warm thanks to Frank for his contributions to Red Hat and for helping prepare Red Hat for the rich business opportunity we have before us,” said Whitehurst, responding to the latest move.

Adverse effect on stock, but gain in last quarter

The stock market has adversely reacted to Calderoni’s decision. Red Hat shares fell over 13 percent.

However, Red Hat received positivity in the quarterly earnings for the fiscal third quarter ended November 30. The company earned $68 million, compared with $46.8 million a year earlier. Quarterly revenue also grew 18 percent to over $615 million.

Red Hat brought certain changes and advancements to its existing business around open source technologies to generate more revenue in the last quarter. The company developed its containerised mobile application platform and expanded its enterprise-centric Linux. Recently, it also upgraded its OpenStack Platform and partnered with companies including ESDS and Ericsson to reach new developing regions like India.

“Customers utilising our cloud-enabling technologies either on-premise or in the public cloud are spending more with Red Hat than customers that have not yet embraced our cloud-enabling technologies,” Whitehurst commented.