Cloud

Rackspace CEO Napier out, and his predecessor returns

Above: Rackspace executives Graham Weston (left) and Lanham Napier

Image Credit: Rackspace

Executives are changing roles at one of the largest public cloud providers on the Internet.

Lanham Napier, who has been chief executive of Rackspace since 2006, is passing the position back to his predecessor, Graham Weston, who held it from 1999 to 2006, according to a filing the company made to the U.S. Securities and Exchange Commission.

Napier is also giving up his board position. But he will stick around as a consultant for three months and receive $140,000 for that work, according to the filing. He has signed a one-year non-competition agreement.

Meanwhile Taylor Rhodes, Rackspace’s chief customer officer, is now president.

The game of musical chairs at the top of Rackspace comes on the same day the company announced solid fourth-quarter earnings, with $408 million in revenue and $21 million in net income, both better than analysts’ estimates.

Even so, market reaction wasn’t good. Rackspace stock was down more than 11 percent after the market close.

The public cloud is a competitive business at the moment, with Rackspace being seen as a hot strong vendor for Infrastructure as a Service, but not nearly as big as Amazon Web Services. Meanwhile IBM has been upping its game, having just announced a big $1.2 billion initiative to expand its global data center footprint. And Google is ramping up, with some cloud observers expecting big things from the search giant.

Microsoft just named former cloud chief Satya Nadella as its chief executive, and he believes the cloud is critical. Rackspace has to watch out for that company in the cloud space, too.

It’s unclear what changes lie ahead for Rackspace’s cloud strategy and its hosting play, now that a previous chief executive is back in that seat.

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