In the third quarter, the WAN optimization leader's revenue jumped 28% to $189.8 million from $147.8 million last year. Non-GAAP net income came out to $40 million, or $0.24 per share, compared to the previous year's $27 million and $0.17 per share. Both the top and bottom lines beat analysts' estimates, which were looking for $185.3 million and $0.21 earnings per share.
The company hit a handful of records, including non-GAAP gross margin of 79% and non-GAAP operating margin of 30.1%. Deferred revenue, an important gauge of the company's sales pipeline, rose 37% to $148 million.
During the quarter, Riverbed spent roughly $120 million acquiring two privately owned companies, Zeus Technology and Aptimize Limited, adding Application Delivery Controllers to its arsenal, expanding its addressable opportunities. The balance sheet remains rock solid, with $476 million in cash and investments.
Part of last quarter's plunge was due to softness in the Europe, Middle East, and Africa (EMEA) segment, which Riverbed CEO Jerry Kennelly had attributed to regional economic conditions as well as the company's own execution. Kennelly was confident that EMEA would improve under new EMEA sales leadership. This has largely come to fruition, with EMEA revenue this quarter growing 30% year over year, and the geographic segment now accounts for 26% of sales.
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Fool contributor Evan Niu owns shares of Riverbed Technology, but he holds no other position in any company mentioned. Check out his holdings and a short bio. The Motley Fool owns shares of Cisco Systems. Motley Fool newsletter services have recommended buying shares of Cisco Systems and Riverbed Technology and writing puts in Riverbed Technology. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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