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UPDATE 1-Rackspace quarterly profit meets estimates

Mon Nov 9, 2009 4:45pm EST

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* Q3 EPS $0.06 matches estimates

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* Q3 rev beats estimates

Nov 9 (Reuters) - Web hosting company Rackspace Hosting Inc (RAX.N) reported a quarterly profit that met market estimates and better-than-expected revenue as it benefited from strong growth at both its managed hosting and cloud businesses.

For the third quarter, managed hosting revenue rose to $147.1 million, up 6 percent sequentially. Cloud revenue increased to $15.3 million, up 17 percent from the second quarter.

Third-quarter net income rose to $7.6 million, or 6 cents a share, from $5.2 million, or 4 cents a share, a year earlier. Revenue rose 17 percent to $162.4 million.

Analysts expected earnings of 6 cents a share, excluding exceptional items, on revenue of $159.1 million, according to Thomson Reuters I/B/E/S.

For 2009, the company, which went public last year, forecast total capital expenditures of about $185 million.

Shares of Rackspace -- whose rivals include Amazon.com (AMZN.O), Terremark (TMRK.O), AT&T (T.N) and Equinix (EQIX.O) -- closed at $18.32 Monday on the New York Stock Exchange. (Reporting by S. John Tilak in Bangalore; Editing by Maju Samuel)

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