Rackspace's first quarter earnings fell short of Wall Street estimates as amid a mixed quarter.
Shares of Rackspace were hammered in afterhours trading on the news.
The company reported first quarter earnings of $23.18 million, or 17 cents a share, on revenue of $301.35 million, up 31 percent from a year ago.
Wall Street was looking for earnings of 18 cents a share on revenue of $300.5 million in the first quarter.
Rackspace said in a statement that its profit margins in the first quarter were 7.7 percent, down from 8.8 percent in the fourth quarter. Margins were up from 6 percent in the first quarter a year ago.
By the numbers:
- Rackspace said its total server count was 82,438 in the first quarter, up from 79,805 at the end of the fourth quarter.
- Total customers were 180,866 in the first quarter, up from 172.510 at the end of the fourth quarter.
- Adjusted EBITDA was $101 million and was hurt by a non-cash charge related to data center leases.
- The company's hosting revenue was $236.6 million with public cloud sales of $64.75 million.
- Average revenue per server was $1,238 in the first quarter, up from $1,191 in the fourth quarter.