What happened
Shares of data center specialist Switch (SWCH) surged on Friday after the company announced second-quarter revenue that was well ahead of the analysts' average forecast.
The stock rose as much as 26.3%, and settled to a gain of about 20% as of 11:30 a.m. EDT today.
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So what
Switch posted revenue of $141.7 million, up 11.6% over the year-ago quarter and 8.3% sequentially. Some of this growth was due to a recent acquisition. Revenue grew 9% organically year over year. Analysts on average were expecting revenue of $134.5 million.
Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) rose 14.3% year over year to $79 million. The key profitability metric was up 7.5% sequentially.
"Importantly, customer installations in the first half of 2021 have paced ahead of expectations, resulting in strong backlog conversion and accelerated revenue growth," management said in the company's second-quarter earnings release.
Now what
Switch said it entered the third quarter with a record backlog. Highlighting the company's momentum, this was the third consecutive quarter with a record backlog.
Looking ahead, management said it was excited about its domestic expansion efforts with the help of its recent acquisition of Data Foundry, as well as "execution of a land purchase agreement with Dell, which will provide a tremendous platform for growth as we expand The Rock Campus in central Texas."
