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Rackspace Tops Q2 Estimates, Shares Soar in Afterhours (RAX)

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Rackspace Hosting Inc. (NYSE: RAX) reported late on Thursday that its fiscal second-quarter profit fell 11% as expenses were higher; however, shares rallied 11.65% in afterhours trading as results beat Street’s consensus estimate.

The Company had missed analysts’ expectations in the previous two quarters.

Commenting over the results, Rackspace Hosting’s Chief Executive Officer, Lanham Napier said in a conference call, “At the beginning of the year, we said that 2013 would be a transformational year for Rackspace,”

“With the first half of the year complete, I think we have made good progress on our journey to build the greatest hybrid cloud company in the industry,” added Lanham.

For the fiscal second quarter ended June 30, the San Antonio based company reported a net income of $22.4 million or 16 cents a share compared to a profit of $25.1 million or 18 cents a share, in the same quarter of last year.

Revenue climbed 18% to $375.8 million from $319 million, in the year-earlier quarter.

Analysts surveyed by FactSet had forecasted earnings of 13 cents a share on revenue of $372.2 million.

For the latest period the company recorded a non-cash charge of $1.5 million linked to data center leases. Also, the workforce increased 16% to 5,272 in the recently concluded quarter.

Total number of servers jumped 16% to 98,884 from the same period of last year while revenue per server increased 2% to $1,298/ month.

 








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edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.

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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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