Log in
Forgot password ?
Become a member for free
Sign up
Sign up
Dynamic quotes 

4-Traders Homepage  >  Equities  >  Nyse  >  Rackspace Hosting, Inc.    RAX

Delayed Quote. Delayed  - 10/25 10:02:29 pm
31.9 USD   -0.06%
10/25 RACKSPACE HOSTI : Launches Largest Global Brand Campaign in 18-Year ..
10/25 RACKSPACE HOSTI : Launches Enhanced Version of Compass for Fanatical..
10/25 RACKSPACE HOSTI : Despite Security Fears, Open Source Is Fuelling In..
News SummaryMost relevantAll newsSector news 

Rackspace Follows Rivals with Cloud Price Cuts

share with twitter share with LinkedIn share with facebook
share via e-mail
02/22/2013 | 05:41pm CEST

--Company cuts price of content services, bandwidth

--Move follows rivals' price cuts

--Shares drop amid revenue-growth concerns

(Adds details on rivals' cost cuts, Rackspace earnings, executive quote.)

   By Drew FitzGerald 

Rackspace Hosting Inc. (>> Rackspace Hosting, Inc.) on Friday slashed prices for some cloud-computing services by as much as a third, responding to similar moves last year made by rivals competing for market share.

The San Antonio, Texas, company said prices for bandwidth and content delivery services, which let users load Web pages faster, will drop 33%, while products in its open cloud product portfolio fall under a new tiered pricing structure. Rackspace is starting with lower prices for its Cloud Files object storage service, with cuts for other products expected in the coming weeks.

Shares recently fell 4.3% to $52.96 as the price cuts revived worries about the pace of revenue growth this year, a concern that erased 20% of Rackspace's value earlier this month, when revenue from upgrades by existing customers slowed to its lowest rate since 2010. The stock is now off about 1.4% over the past 12 months.

Rackspace has seen strong profit growth in recent years as expanding Internet use drives demand for its Web-hosting services. The company has posted particularly strong revenue growth in its public cloud business, which allows companies to rent computing resources from a shared set of machines.

Friday's move follows similar actions by rival Amazon.com Inc. (>> Amazon.com, Inc.), which dominates the so-called public cloud market for rented computing services. The retailer's business-focused Amazon Web Services unit has said it has cut prices 25 times in its history, including several times late last year.

Other technology companies attempting to chip away at Amazon's lead have responded with similar cuts. Google Inc. (>> Google Inc) last fall dropped its computing-storage prices by about 20%, to a starting price of 9.5 cents a month for each gigabyte. Amazon matched that starting price, and Google responded with another cut, to 8.5 cents per gigabyte. Microsoft Corp.'s (>> Microsoft Corporation) Azure cloud service followed a few days later with cost cuts of its own.

Rackspace's volume discounts unveiled Friday range from 10 cents per gigabyte per month for the first terabyte of storage to 7.5 cents past 524 terabytes and lower for even larger storage levels.

Company executives often distinguish their service-focused business model from competitors' storage and computing work and have said Rackspace competes with peers on the basis of its customer support more than on price.

"There is a lot of distance between what they're doing and we're doing," Chief Technology Officer John Engates told Dow Jones in a December interview. "Amazon ... they kind of wait for you to call them for support, but Rackspace is interested in the day-to-day management."

(Saabira Chaudhuri, Shira Ovide, Greg Bensinger and Amir Efrati contributed to this article.)

-Write to Drew FitzGerald at andrew.fitzgerald@dowjones.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

share with twitter share with LinkedIn share with facebook
share via e-mail
10/25 RACKSPACE HOSTING : Launches Enhanced Version of Compass for Fanatical Support f..
10/25 RACKSPACE HOSTING : Launches Largest Global Brand Campaign in 18-Year History
10/25 RACKSPACE HOSTING : Despite Security Fears, Open Source Is Fuelling Innovation a..
10/21 RACKSPACE HOSTING : Promotes Reinhard Waldinger to Lead International, and Appoi..
10/20 LAWSUIT FILED FOR INVESTORS IN RACKS : RAX) Against the Takeover at $32 Per Shar..
10/19 RACKSPACE HOSTING : Launches Largest Global Brand Campaign in 18-Year History
10/18 RACKSPACE HOSTING : Launches Enhanced Version of Compass for Fanatical Support f..
10/13 RACKSPACE HOSTING : National Kidney Registry Enlists Rackspace Managed Security ..
10/13 RACKSPACE HOSTING, INC. : Other Events, Financial Statements and Exhibits (form ..
10/07 RACKSPACE HOSTING : Security concerns costing the uk application economy £2.5bn ..
More news
Sector news : Cloud Computing Services
10/25DJGENERAL MOTORS : Brings IBM Watson Into its Vehicles
10/25DJTata Steel U.K. Pension Deficit Narrows to GBP50 Million, But Risks Remain
10/25DJLOCKHEED MARTIN : Revenue Soars, and It Boosts Guidance
10/25 India's Cyrus Mistry denies filing 'caveats'
10/25 Tata interim chief asks group's heads to go about business as usual
More sector news : Cloud Computing Services
News from SeekingAlpha
10/24 AT&T's Big Dividend On Sale
09/30 Gain Over 80% With This Unfairly Punished Stock
09/21 Adobe - A Lesson On How To Migrate To The Cloud
09/19 GE And Hillary Face Tough Votes
09/12 Google Battles Diabetes
Financials ($)
Sales 2016 2 072 M
EBIT 2016 242 M
Net income 2016 135 M
Debt 2016 17,1 M
Yield 2016 -
P/E ratio 2016 30,05
P/E ratio 2017 29,38
EV / Sales 2016 1,95x
EV / Sales 2017 1,81x
Capitalization 4 013 M
More Financials
Duration : Period :
Rackspace Hosting, Inc. Technical Analysis Chart | RAX | US7500861007 | 4-Traders
Full-screen chart
Technical analysis trends RACKSPACE HOSTING...
Short TermMid-TermLong Term
Technical analysis
Income Statement Evolution
More Financials
Mean consensus HOLD
Number of Analysts 17
Average target price 30,9 $
Spread / Average Target -3,1%
Consensus details
EPS Revisions
More Estimates Revisions
William Taylor Rhodes President, Chief Executive Officer & Director
Graham M. Weston Chairman
Mark W. Roenigk Chief Operating Officer
Karl Pichler Chief Financial Officer, Treasurer & Senior VP
John Engates Chief Technology Officer
More about the company
Sector and Competitors
1st jan.Capitalization (M$)
SALESFORCE.COM, INC.-4.26%51 416
QUALYS INC12.27%1 314
More Results