)
Overview
<ul>
<li>US hybrid cloud and AI provider’s Q1 revenue rose 2% yr/yr, beating analyst expectations</li>
<li>Net income turned positive at $8 mln after a loss in prior year</li>
<li>Company signed MOU with AMD to develop governed enterprise AI infrastructure</li>
</ul>
Outlook
<ul>
<li>Rackspace Technology sees FY 2026 revenue between $2.6 bln and $2.7 bln</li>
<li>Company expects FY 2026 public cloud revenue of $1.575 bln to $1.625 bln</li>
<li>Rackspace Technology expects FY 2026 non-GAAP loss per share of ($0.15) to ($0.20)</li>
</ul>
Result Drivers
<ul>
<li>PUBLIC CLOUD GROWTH - Public Cloud revenue rose 7% yr/yr, offsetting Private Cloud declines</li>
<li>REGULATED ENTERPRISE AI FOCUS - Co said results reflect its strategy to serve regulated enterprises seeking governed AI infrastructure, per CEO Gajen Kandiah</li>
<li>PRIVATE CLOUD WEAKNESS - Private Cloud revenue fell 6% yr/yr, weighing on overall growth Company press release:</li>
</ul>
Key Details
Metric Beat/Mis Actual Consensu
s s
Estimate
Q1 Beat $678.10 $660.83
Revenue mln mln (3
Analysts
)
Q1 Miss -$0.06 -$0.04
Adjusted (2
EPS Analysts
)
Q1 Net $8.30
Income mln
Q1 $31 mln
Adjusted
Operatin
g Income
Q1 Capex $35 mln
Q1 Gross $119.10
Profit mln
Analyst Coverage
<ul>
<li>The current average analyst rating on the shares is “hold” and the breakdown of recommendations is no “strong buy” or “buy”, 3 “hold” and no “sell” or “strong sell”</li>
<li>Wall Street’s median 12-month price target for Rackspace Technology Inc is $2.00, about 11.9% below its May 6 closing price of $2.27 For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact . (This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)</li>
</ul>

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IGPT

- Rackspace Technology's Q1 revenue increased by 2% year-over-year to $678.1 million, surpassing analyst expectations.  
- The company reported a net income of $8 million, a turnaround from the previous year’s loss, and signed an MOU with AMD to develop enterprise AI infrastructure.  
- For FY 2026, Rackspace anticipates revenues between $2.6 billion and $2.7 billion, with a public cloud revenue of $1.575 billion to $1.625 billion.

Rackspace Technology Q1 revenue rises 2%, beats estimates