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Aug. 6, 2021, 8:18 a.m. EDT

Switch stock jumps on possible reorganization as a REIT

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By Wallace Witkowski

Switch Inc. shares rallied in the extended session Thursday after the company reported quarterly results and said it was considering a possible reorganization into a real-estate investment trust.

Switch shares surged 14% after hours, following a 0.2% decline in the regular session to close at $20.31.

As it reported quarterly results, the Las Vegas-based company, which develops and operates data centers, said it had “shareholder value initiatives” under review that included a board evaluation on whether to become a real estate investment trust and a review of its board structure. Switch went public in October 2017.

Switch reported second-quarter net income of $4.3 million, or 3 cents a share, compared with $5.1 million, or 5 cents a share, in the year-ago period. Revenue rose to $141.7 million from $126.9 million in the year-ago quarter.

Analysts surveyed by FactSet had forecast 5 cents a share on revenue of $135.4 million.

With the company’s $420 million acquisition of Data Foundry closing on June 7, Switch forecast revenue between  $593.5 million and $603.5 million for the year including Data Foundry. Excluding Data Foundry, the company forecast revenue between $566 million and $574 million. Analysts estimated revenue of $561.4 million for the year.

“Following the close of our Data Foundry acquisition, we are already executing on operational efficiencies and seeing strong customer demand in Texas,” said Rob Roy, Switch founder and chief executive, in a statement. “We look forward to sharing future progress as we continue to expand capacity at The Rock Campus, both at Dell’s /zigman2/quotes/203822527/composite DELL -0.68% global headquarters and the Data Foundry properties in Austin and Houston.”

“These initiatives are in addition to our highly active construction pipeline across the other Switch Primes, where we expect to open 1.3 million square feet of space between now and early 2023,” Roy said.

$ 37.82
-0.26 -0.68%
Volume: 3.22M
March 23, 2023 4:00p
P/E Ratio
Dividend Yield
Market Cap
$27.27 billion
Rev. per Employee

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