Rackspace Hosting Reports Third Quarter 2010 Results

SAN ANTONIO – November 8, 2010 – Rackspace® Hosting, Inc. (NYSE: RAX), the world’s leader in the hosting and cloud computing industry, announced financial results for the quarter ended September 30, 2010.

Net revenue for the third quarter of 2010 was $199.7 million, up 6.6% from the previous quarter and 23.0% from the third quarter of 2009.  Net revenue for the third quarter of 2010 was positively impacted by currency exchange rates when compared to the second quarter of 2010, but was negatively impacted when compared to the third quarter of 2009.

Changes in currency exchange rates had a positive impact on net revenue of $1.8 million quarter-over-quarter, and a negative impact on net revenue of $2.9 million on a year-over-year basis.

Managed hosting revenue for the quarter increased to $172.9 million, up from $164.1 million in the prior quarter.  Cloud revenue increased to $26.8 million in the quarter, up from $23.2 million in the previous quarter.

Total server count increased to 63,996, up from 61,874, servers at the end of the second quarter of 2010, and total customers increased to 118,732, up from 108,023 at the end of the previous quarter.

“Our efforts to improve the business model are working.  We have been making investments to enhance the capital efficiency of our business and we are beginning to see the early returns on those investments now.” said Lanham Napier, president and chief executive officer.

Please click here for the entire release.