Rackspace stock sinks as it misses estimates

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Cloud-services provider Rackspace Technology Inc. missed expectations across the board even as Chief Executive Kevin Jones said Thursday that the company’s fourth quarter “capped off a fantastic year,” during which bookings and revenue grew.

Rackspace
RXT,
+1.55%

shares fell more than 8.5% after hours, after rising 1.6% in the regular session to close at $24.96. 

The San Antonio, Texas-based company reported a fourth-quarter loss of $64 million, or 32 cents a share, compared with a loss of $47 million, or 28 cents a share, in the year-ago period. Adjusted earnings were 26 cents a share, adjusted for stock-based compensation, bonuses and more. Revenue rose to $716 million from $627 million in the year-ago quarter. Analysts surveyed by FactSet had forecast earnings of 31 cents a share on revenue of $765 million.

For the full fiscal year, Rackspace lost $246 million, or $1.37 a share, compared with a loss of $102 million, or 62 cents a share in 2019. Adjusted earnings were 83 cents a share, adjusted for deferred income taxes, stock-based compensation and more. Revenue rose to $2.7 billion, up 11% from 2019 revenue of $2.44 billion. Analysts had expected earnings of $1.13 a share on revenue of $2.94 billion.

Rackspace said it expects full-year fiscal 2021 non-GAAP earnings of 95 cents to $1.05 a share on revenue of $2.9 billion to $3.1 billion.



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