Data storage company Xyratex returned to a fourth-quarter profit and released an optimistic outlook for the first quarter of 2010.

It's shares jumped 8 percent Wednesday.

The company reported lower operating costs to end the year and improved gross profit margins as it was able to collect higher charges.

The U.K.-based company said late Tuesday that it earned $1.6 million, or 5 cents per share, for the three months ended Nov. 30, compared with a loss of $55.7 million, or $1.92 per share, of a year ago.

Taking out restructuring costs and other items, earnings were $7.9 million, or 26 cents per share.

Analysts surveyed by Thomson Reuters, whose estimates typically exclude one-time items, predicted a profit of 38 cents per share.

Gross profit margin increased to 15.6 percent from 12.5 percent.

Sales dropped 15 percent to $243 million from $285.4 million on revenue declines in both its network storage solutions and storage infrastructure segments. That missed Wall Street's estimate of $262.8 million.

For the year, Xyratex narrowed its loss to $16.4 million, or 56 cents per share, from $47.9 million, or $1.64 per share, in the previous year.

Annual sales fell to $867.9 million from $1.05 billion.

The company anticipates first-quarter adjusted earnings of 32 cents to 60 cents per share and forecast sales of $245 million to $285 million for the period.

Analysts had been looking for a first-quarter profit of 10 cents per share on sales of $233.4 million.

Shares of Xyratex Ltd. jumped $1.27 to $16.52, a 52-week high.