The company has also reported a 30 percent fall in its quarter 4 earnings attributing the decline to higher costs.
Mr Napier was associated with Rackspace hosting for 14 years and its current Chairman Graham Weston will succeed him. The company is in fact going into old hands because Mr. Weston has been the CEO of Rackspace from 1999 to 2006.
Mr. Napier will remain available in consultant capacity during the transition period which will last for many months. Mr. Napier said:
“With the board and management team aligned around our 2014 strategy and financial plan, I believe now is a natural transition point to select a new leader for the next exciting phase of Rackspace’s growth. Graham is the right person to step in and lead Rackspace since he’s been with the company from the beginning and served us well previously as CEO for seven years.”
The company has been struggling with its cloud hosting business because it has failed to attract new long time business customers. Rackspace is taking measures to revive its web hosting business by hiring new marketing staff. It has also invested in new hardware to beef up its cloud hosting infrastructure.