October 23, 2007 / 10:48 PM / 11 years ago

UPDATE 1-Savvis posts Q3 profit, sees Q4 revenue below Street

(Recasts, adds outlook, share movement)

Oct 23 (Reuters) - Telecommunications carrier Savvis Inc SVVS.O posted a profit in the third quarter but guided fourth-quarter and 2008 revenue below Wall Street expectations, sending shares down 19 percent.

For the third quarter, Savvis posted a profit of $5.3 million, or 10 cents a share, compared with a net loss of $13.6 million, or 27 cents a share, a year ago.

The company said it recorded an income tax benefit of $1.9 million in the latest quarter.

Revenue fell nearly 2 percent to $190.3 million primarily due to the sale of certain data-center assets to Microsoft Corp (MSFT.O) at the end of June, the company said in a statement.

Analysts on average expected the company to break even, on revenue of $196.3 million, according to Reuters Estimates.

The company, which has IT services platform across North America, Europe and Asia, said sales bookings rose 40 percent in the third quarter.

“During the year we sold low-growth assets for cash proceeds of $319 million, which we are reinvesting in seven high-quality data centers that will increase our growth opportunities for 2008 and beyond,” Chief Executive Officer Phil Koen said.

For the fourth quarter, the company expects revenue of $197 million to $200 million, while analysts expect $207.1 million.

For fiscal 2008, it sees revenue of $910 million to $925 million. Analysts expect $931.3 million.

Shares of the company fell to $33.50 in late electronic trade after closing at $41.29 Tuesday on the Nasdaq. (Reporting by Bhaswati Mukhopadhyay in Bangalore)

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