The San Antonio, Texas-based firm increased revenue 25% to $353 million, below Wall Street's forecast of $355.42 million. The AT&T (T - Get Report) and Savvis rival said fourth-quarter revenue was helped by currency exchange rates.
Investors pushed down Rackspace shares by 8.9% to $68.30.
Rackspace, which doesn't break out non-GAAP EPS, said it earned 21 cents a share on net income of $30 million, compared with 18 cents a share and net income of $25 million in the year-earlier quarter. Analysts surveyed by Thomson Reuters were looking for earnings of 21 cents a share.The company's total customers grew to 205,538 from 197,635 sequentially. Rackspace's total server count increased to 90,524 from 89,051 at the end of third quarter. "We are very pleased with the financial results we have delivered in 2012. Even more importantly, we are excited about the growth opportunities that our new set of open cloud products will provide us in the future," said Karl Pichler, Rackspace's chief financial officer, in a statement released after the market close. -- Written by James Rogers in New York. Follow @jamesjrogers >To submit a news tip, send an email to: firstname.lastname@example.org.