Red Hat slides amid weak forecast

Red Hat
Source: Red Hat

Red Hat shares dropped more than 1 percent Thursday despite beating revenue forecasts in its latest quarterly report.

The company also posted adjusted earnings of 50 cents per share for first quarter fiscal year 2017, matching Wall Street estimates.

However, the open source technology company projected a weaker-than-expected outlook for the current quarter due to costs associated with its acquisition this week of API management company 3scale. Red Hat also announced a $1 billion share repurchase program.

Shares of the company have risen substantially in recent years, but are down more than 5 percent since Jan. 1.

Red Hat in 2016

CNBC's Peter Schacknow contributed reporting.