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Red Hat restates earnings

Linux company revises earnings formula, restates numbers back to 2002.

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By Dawn Kawamoto
Staff Writer, CNET News.com

Red Hat announced Tuesday it was restating revenue and earnings going back to 2002, as the company changes the way in which it accounts for subscription revenue.

The Linux company, which recently reported the , said it made its decision to change its revenue recognition after a discussion last month with its independent auditors, PricewaterhouseCoopers.

The company will now recognize its subscription revenues on a daily basis, rather than a monthly basis.

As a result, the company will restate its revenues and earnings for fiscal years 2002, 2003 and 2004, which ended at the end of February. The company will also restate its un-audited financial statements for its first quarter, which ended May 31.

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