USA Web Hosting Company Revenue Beats Estimates – 11/13/2014

Rackspace Hosting Inc reported a better-than-expected 18.3 percent jump in quarterly revenue, helped by higher demand for its cloud management and web hosting services.

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The company’s revenue rose to $459.8 million for the third quarter ended Sept. 30, from $388.6 million a year earlier.

Net income rose to $25.7 million, or 18 cents per share, from $16.3 million, or 11 cents.

Rackspace, which is facing tough price competition from Amazon.com Inc, Google Inc and Microsoft Corp, said the forecast included a $5 million impact from foreign currency fluctuation.

The company expects fourth-quarter adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) margin of 33-35 percent. It reported an adjusted EBITDA margin of 34.5 percent for the third quarter.

Rackspace’s shares were trading at $38.45 in extended trading after closing at $37.32 on the New York Stock Exchange on Monday.