Rackspace Announces Third Quarter Financial Results

Rackspace® Managed Hosting today announced its third quarter results for 2007. The company’s revenue was $96.2 million in the third quarter of 2007, representing a 63 percent increase over the third quarter of 2006. Rackspace also reported positive net income for the third quarter of 2007 and has experienced 35 consecutive quarters of revenue growth since the company’s inception.

In the third quarter of 2007, Rackspace completed the acquisition of Webmail.us, a leading provider of business class email hosting with more than 600,000 business mailboxes under management. Together, Rackspace and Webmail.us have launched a new mail hosting division to create innovative new products focused on enterprise-class mail functionality.

“We continue to post strong growth numbers across all areas of our business as we invest in new technologies and services for our customers worldwide,” said Lanham Napier, president and chief executive officer, Rackspace Managed Hosting. “We credit our success to Rackspace’s focus on Fanatical Support® and the value it brings to our customers. We will continue to respond to customer demand to transform traditional IT functions into services consumable via the web, with managed mail as the first product in our portfolio.”

About Rackspace Managed Hosting

A recognized leader in the global managed hosting market, Rackspace Managed Hosting delivers enterprise-level managed services to businesses of all sizes. Serving more than 15,000 customers in eight data centers worldwide, Rackspace integrates the industry’s best technologies for each customer need and delivers it as a service via the company’s award-winning Fanatical Support. Through trusted relationships, Rackspace serves as an extension of its customers’ IT departments, enabling them to focus on their core business. Since its inception in 1998, Rackspace has grown more than 50 percent per year. For more information, please visit www.rackspace.com, or call 800-961-2888.

Contacts

Rackspace Managed Hosting, San Antonio
Annalie Drusch, 210-312-4192
adrusch {at} rackspace(.)com