This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Rackspace Hosting Reports Third Quarter 2012 Results

Rackspace ® Hosting, Inc. (NYSE: RAX), the open cloud company, announced financial results for the quarter ended September 30, 2012.

Net revenue for the third quarter of 2012 was $336 million, up 5.3% from the previous quarter and 27% from the third quarter of 2011. Net revenue for the third quarter of 2012 was negatively impacted by currency exchange rates, when compared to the third quarter of 2011, by $1.5 million, and was negatively impacted compared to the previous quarter by $0.1 million.

Total server count increased to 89,051 up from 84,978 servers at the end of the previous quarter, and total customers increased to 197,635, up from 190,958 at the end of the previous quarter.

“We have successfully enhanced our product and services portfolio while managing a rapidly growing business and building a better economic model.  We believe the work we’ve accomplished so far in 2012 increases our competitiveness in this massive cloud opportunity,” said Karl Pichler, chief financial officer.

Adjusted EBITDA for the quarter was $122 million, an 8.8% increase compared to the second quarter of 2012 and a 38% increase compared to the third quarter of 2011. The adjusted EBITDA margin for the quarter was 36.2% compared to 35.1% in the previous quarter and 33.3% for the third quarter of 2011.

Consistent with prior periods, adjusted EBITDA and adjusted EBITDA margin were negatively impacted by a non-cash charge relating to data center operating leases. During the third quarter of 2012, the non-cash data center lease charge was $2.3 million.

Net income was $27 million for the quarter, up 8.2% from the previous quarter and up 36% from the third quarter of 2011. Net income margin for the quarter was 8.1% compared to 7.9% for the previous quarter and 7.6% in the third quarter of 2011.

Cash flow from operating activities was $100 million for the third quarter of 2012. Capital expenditures were $85 million, including $51 million for purchases of customer gear, $5.8 million for data center build outs, $3.4 million for office build outs and $25 million for capitalized software and other projects.

1 of 8

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

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.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,943.81 +28.74 0.17%
S&P 500 1,967.57 +2.89 0.15%
NASDAQ 4,415.49 +19.2860 0.44%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs