Rackable Systems (RACK) reported Q4 revenue of $111.7 million, with pro forma EPS of 18 cents; that beat the Street consensus of $106.3 million and 5 cents.

However, the provider of servers to Web site operators and other companies projected revenue for 2008 of $353 million to $388 million, below the Street consensus of $406.1 million. The company sees non-GAAP gross margin in the 17%-20% range - down from 21.7% in the fourth quarter - with “positive” non-GAAP EPS. The Street has been looking for 19 cents a share.

In after hours trading, Rackable is down 9 cents, at $7.90; the stock slid 22 cents in the regular session.