TECH STOCKS: Adobe, Rackspace Losses Take Tech Spotlight

By Rex Crum, MarketWatch

SAN FRANCISCO (MarketWatch) -- Losses from Adobe Systems Inc. and Rackspace Hosting Inc. stood out among tech stocks Wednesday, running counter to what was an otherwise broad slate of gains for the sector.

Adobe (ADBE) shares fell almost 5% to close at $67.30 on reaction to the software company's latest quarterly results and forecast.

Late Tuesday, Adobe reported fiscal third-quarter sales of $1.01 billion, which was shy of the $1.02 billion forecast by Wall Street analysts. Adobe also said that for its fiscal fourth quarter, it expects to earn between 26 cents and 32 cents a share, on revenue in a range of $1.03 billion to $1.08 billion. Analysts had earlier forecast Adobe to earn 29 cents a share on $1.05 billion in sales for the quarter.

Rackspace (RAX) shares tumbled by almost 18% to end the day at $32.39. After Tuesday's market close, the cloud-computing company said it had stopped efforts to sell itself and would remain independent. Rackspace also appointed company President Taylor Rhodes as its new chief executive.

Among tech-sector leaders, gains came from Apple Inc. (AAPL) , which rose 72 cents to $101.58 on the day that its iOS 8 operating system upgrade for the iPhone and iPad was released. While the operating system got many high marks, there were still concerns about how much storage the upgrade takes up on the iPhone

Hewlett-Packard Co. (HPQ), online travel agent Priceline.com Inc. (PCLN) and eBay Inc. (EBAY) also ended the day with gains.

Microsoft Corp. (MSFT) shares shed 0.5% to close at $46.52. Late Tuesday, the software giant said it would raise its quarterly by 3 cents a share, or 11%, to 31 cents a share. Microsoft also named Kraft Foods Group Inc. Chief Financial Officer Teri List-Stoll and Visa Inc. CEO Charles Scharf to its board of directors. It was Microsoft's first dividend announcement and new director appointments since former CEO Steve Ballmer left the company's board in August.

The tech-heavy Nasdaq Composite Index (RIXF) rose 9 points to close at 4,562 and the Philadelphia Semiconductor Index (SOX) also ended the day in positive territory.

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