Solid Earnings for Switch & Data

Switch & Data (SDXC) posted solid earningsTuesday, reporting earnings and revenues in line with Wall Street expectations. The Tampa-based colocation and interconnection specialist reported a loss of 6 cents per share on revenues of $47.1 million, up 18 percent from the previous year. The company also updated its guidance for fiscal year 2009, projecting revenues of $207 to 210 million, slightly above the analyst consensus.

Switch and Data said new space in its New Jersey data center is about 40 percent filled. The North Bergen facility will be a key focus of the company's growing push into hosting low-latency financial trading applications.

In the conference call with analysts, Switch & Data CEO Keith Olsen noted a modest pickup for activity in the SME sector.

 "We saw improving demand and new orders improving from small and midsized customers," said Olsen, who said the activity was focused among "existing customers that seem to have compressed some of their growth through the latter stages of 2008. That’s the operating environment we saw the improvements on.

"A couple of month's worth of results doesn’t necessarily provide a lot of data points," he added. "But I thought it was worth referencing because now we are starting to see not only two healthy quarters of new logos but also demand from our existing small and midsize customers starting to uptick."

Colocation revenue was $30.2 million, or 64 percent of all revenue, while interconnections accounted for $14.6 million (31 percent). Switch and Data now has 966 customers and 7,864 billable cabinets. Total cross connects were 7,864, up from 7,034 a year ago.