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RACK
Rackable Systems, Inc.
January 17, 2007
Today Rackable Systems announced that it estimates that Q4 2006 revenues were in the range of $105.5 to $106.8 million, and that GAAP earnings would be in the range of a loss of 2 cents to a gain of 1 cent per share. They also stated that non-GAAP earnings would be $0.17 to $0.18 per share.
This puts revenues in the mid-range of the guidance given at the 10/30/2006 analyst conference, but GAAP earnings per share way below the projected $0.10 to $0.12 per share.
The press release indicated that earnings were impacted by unexpectedly high costs of memory and price competition. My guess is the competition was from Dell, which finally starting competing with AMD Opteron based servers.
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Disclaimer: Our analyst summaries may include both our condensations of statements made by company representatives and our own analysis. They are not covered by any warranty. We cannot guarantee anything said by company representatives is true. We try not to make errors, but its possible. Before making or terminating an investment you should always verify any factual basis of your decision.
Copyright 2006 William P. Meyers