Loudcloud results send shares into orbit

Shares in web hosting provider Loudcloud soared on opening today, after strong third quarter results were reported overnight.

Shares reached $3.85 by 10:00 Eastern Time in New York, an increase of 22 per cent on the previous night's close.

The company - brainchild of Netscape founder Marc Andreessen - beat analyst expectations by narrowing net losses to $40m, a 30 per cent improvement on results in Q3 2000. Its loss per share was just 62 cents, compared to analysts' estimates of around 69 cents.

Revenues jumped by 211 per cent to $14.3m for the quarter, up from $4.6m in Q3 2000.

Loudcloud still has $140m in cash after its IPO in March of this year, and has signed a number of lucrative contracts in recent months, notably with the UK Post Office and the e-envoy's office in the Cabinet Office.

Since its flotation in March the company has consistently beaten analysts' estimates, despite the uncertain economic climate.

However, it still has to contend with a share price just half the level it reached on its IPO.