NEW YORK (TheStreet) -- Shares of Equinix (EQIX) suffered the biggest percentage decline in extended trading on Tuesday after the Foster City, Calif.-based provider of global data center services lowered its revenue outlook for the third quarter and full year.
The company cited deeper discounting than expected on long-term contract renewals, its underestimation of churn levels in North America, revenue weakness for a switch and data business it acquired in April.
Equinix now sees revenue of $328 million to $335 million for the September period, compared to its prior range of $335 million to $338 million. Wall Street's current consensus estimate is for revenue of $336.8 million for the period. In the full year, the company expects revenue of $1.215 billion vs. a previous projection of $1.225 billion to $1.235 billion.
The stock was crushed after the close, falling 26% to $78.23. Volume of 4.1 million was more than five times the issue's trailing three-month daily average of around 790,000. The shares had finished the regular session at $105.99, up 4%. Year-to-date, not reflecting the sell-off after the close, the stock was down almost 5%, but it had rallied 40% since scraping a 52-week low of $76.29 on July 7.Equinix, which boosted its adjusted EBITDA [earnings before interest, taxes, depreciation and amortization] outlook at the same time, is expected to report its full results for the third quarter on Oct. 26. On a bottomline basis, Wall Street is expecting a profit of 24 cents a share. The news on Equinix was weighing on shares of its competitors after the bell, including Savvis Inc. (SVVS), whose stock lost nearly 10% to $19.51 on volume of roughly 214,000; Terremark Worldwide (TMRK), which was quoted down 8% at $9.34 on volume of around 20,000; and Rackspace Hosting (RAX), which fell 8.5% to $23.99 on volume of 157,000, according to Nasdaq.com.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV