Equinix shares plunge as company forecasts less revenue because of customer losses, discounts

Equinix cuts 3Q and 2010 revenue estimates

FOSTER CITY, Calif. — Data center service provider Equinix Inc. lowered its third-quarter and full-year revenue forecasts Tuesday, sending its shares tumbling in aftermarket trading.

Equinix said it has lost more customers in North America than it expected. It also needed to cut prices by more than expected to win long-term contracts, and said the Switch and Data business it bought in April did not bring in as much revenue as it had estimated.

In aftermarket trading, Equinix shares dropped $19.99, or 19 percent, to $85.26. The stock closed the regular session up 4 percent at $105.09 during a broader market rally.

The company is now forecasting $328 million to $330 million in revenue for the third quarter, down from its previous estimate of $335 million to $338 million. For the full year, Equinix is now calling for about $1.22 billion in revenue, down from a prior forecast of $1.23 billion to $1.24 billion.

Analysts, on average, have expected the company to report $336.8 million in revenue in the third quarter, according to Thomson Reuters. On average analysts are looking for $1.23 billion in revenue for the year.