[The Street] Rackspace Racks Up Revenue Beat

Cloud computing company Rackspace(RAX) continues to enjoy strong momentum, racking up a third-quarter revenue beat after market close on Monday.

The managed hosting specialist brought in sales of $265 million, an increase of 32.5% on the same period last year, and comfortably above Wall Street's estimate of $261.63 million.

Rackspace, which does not break out non-GAAP EPS, earned 14 cents a share on net income of $20 million, up from 9 cents a share and $11.8 million in the prior year's quarter, and in line with analysts' projection.

The numbers pushed shares of Rackspace up $1, or 2.4%, to $42.75 in extended trading.

Rackspace's total server count increased to 78,717, up from 74,028 in the prior quarter. Total customers climbed to 161,422, up from 152,578 at the end of the second quarter.

"We are very pleased with this quarter's results," explained Karl Pichler, the Rackspace CFO, in a statement. "We are focused on finishing the year on a strong note."

Rackspace also cited ongoing growth, even in an uncertain economy. "We're not out of the woods by any means, but our growth has accelerated three quarters in a row," Bryan McGrath, the company's director of finance, told TheStreet.

The company did not issue guidance for the fourth quarter, however.

Rackspace's stock is up more than 30% so far in 2011, and Wall Street was split on the stock ahead of Monday's report with 10 of the 20 sell-side analysts covering the stock in the bull camp at strong buy (4) or buy (6), and the remainder at either hold (9) or underperform (1).

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