Red Hat Inc (RHT.N), the world's largest distributor of Linux operating software, forecast second-quarter revenue below Wall Street estimates after quarterly billings fell short of analysts' expectations.
Shares of Red Hat fell 10 percent in after-market trading.
Weak economies hurt billings in the first quarter and are expected to further affect growth, Chief Executive Charles Peters said on a conference call.
Red Hat, which competes with Microsoft Corp's (MSFT.O) Windows in corporate markets, said it expects second-quarter revenue to be between $320 million and $322 million, and adjusted earnings of 28 cents to 29 cents per share.
Analysts on average were expecting the company to earn 29 cents per share, excluding items, on revenue of $330.8 million for the second quarter, according to Thomson Reuters I/B/E/S.
The slowdown in Europe and Japan are expected to hurt results, the company said and cut its full-year revenue forecast to between $1.32 billion and $1.34 billion, from $1.34 billion to $1.36 billion, as the dollar rises.
Analysts were expecting full-year revenue of $1.35 billion.
Mizuho Securities analyst Abhey Lamba said Red Hat missed analysts' forecast for billings, the sum of revenue and the change in deferred revenue.
Red Hat reported first-quarter billings of $310 million, compared with the Wall Street view of $319 million, Lamba told Reuters.
Net income rose to $37.5 million, or 19 cents per share, from $32.5 million, or 17 cents per share, a year earlier.
Excluding items, the company earned 30 cents per share.
Revenue rose 19 percent to $314.7 million.
Analysts expected earnings of 27 cents per share on revenue of $310.8 million.
Shares of the company fell to $50.14 after closing to $56.50 on the Nasdaq on Wednesday.
(Reporting by Chandni Doulatramani in Bangalore; Editing by Saumyadeb Chakrabarty and Joyjeet Das)