Companies /Technology

Rackspace Technology Inc

NASDAQ: RXT Software - Infrastructure
$3.30
▲ $0.29 (+9.63%) today
Markets open · 3:33pm ET

Q2 2026 Earnings

Reported Aug 10, 2026, 4:08pm ET · SEC source
$-0.08
Beat +11.21%
EPS · est. $-0.09 Adjusted
$670.1M
Beat +3.73%
Revenue · est. $646.0M
1 quarter
Consecutive EPS beats

Market Reaction

% change · around the report
0+6%+12%+18%Aug 10Aug 11report 4:08pm ETearnings−0.2%−1.3%
0+6%+12%+18%Aug 10Aug 11earnings−0.2%−1.3%
RXT −1.3%S&P 500 −0.2%
0+6%+12%+18%Aug 10Aug 11report 4:08pm ETearnings−0.3%−1.3%
0+6%+12%+18%Aug 10Aug 11earnings−0.3%−1.3%
RXT −1.3%NASDAQ −0.3%
−20%0Aug 10Aug 18report 4:08pm ETearnings−0.7%−23.9%
−20%0Aug 10Aug 18earnings−0.7%−23.9%
RXT −23.9%S&P 500 −0.7%
−20%0Aug 10Aug 18report 4:08pm ETearnings−0.6%−23.9%
−20%0Aug 10Aug 18earnings−0.6%−23.9%
RXT −23.9%NASDAQ −0.6%
−3.47%
Day of report
−8.03%
Next session
−16.49%
One week

Did RXT Beat Earnings? Q2 2026 Results

Rackspace Technology posted a better-than-feared second quarter for fiscal 2026, beating both top and bottom-line expectations even as underlying pressures mounted. Revenue of $670.10 million edged up 0.6% year-over-year and cleared the $646.00 million consensus by 3.73%, while an adjusted loss per share of $0.08 came in ahead of the $0.09 estimate by 11.21%. The headline beats, however, masked meaningful margin erosion: gross margin compressed to 17.1% from 19.4% a year ago as cost of revenue climbed 3.4%, and GAAP operating loss widened to $33.20 million. The single biggest earnings-story headwind was a 60.6% surge in interest expense to $34.20 million, which deepened the net loss to $67.50 million. Adding further complexity, multiple securities fraud class action lawsuits have emerged alleging the company misled investors about the financial impact of its AI pivot. Looking ahead, Rackspace guided for full-year 2026 revenue of $2.45 billion to $2.55 billion, with Adjusted EBITDA of $285.00 million to $295.00 million.

Key Takeaways
  • Private Cloud revenue grew 5.5% YoY, driving overall revenue growth
  • Public Cloud revenue declined 2.3% YoY, partially offsetting gains
  • Non-GAAP Operating Profit was essentially flat at $27.4 million
  • Adjusted EBITDA increased to $65.9 million from $64.4 million
  • Interest expense increased 60.6% YoY to $34.2 million
  • Restructuring and transformation expenses rose to $18.4 million from $4.4 million

“Enterprises in regulated industries are moving AI from experimentation into production, and they are choosing partners who can be accountable for it.”

Rackspace Technology CEO, on the earnings call

Forward Guidance & Outlook

Rackspace provided FY 2026 guidance: Total Revenue of $2,450–$2,550 million (Private Cloud Revenue $1,000–$1,050 million; Public Cloud Revenue $1,450–$1,500 million), Non-GAAP Operating Profit of $125–$135 million, Adjusted EBITDA of $285–$295 million, Non-GAAP Loss Per Share of ($0.25)–($0.30), Non-GAAP Other Income (Expense) of ($220)–($230) million, Non-GAAP Tax Expense Rate of 26%, and Non-GAAP Weighted Average Shares of 250–260 million (excluding any dilution from the ATM program).

RXT YoY Financials

Q2 2026 vs Q2 2025 · SEC filings Q2 2025 Q2 2026
$0$300.0M$600.0M$666.3M$670.1MRevenue$129.2M$114.8MGross Profit$-49,018,160$-33,200,000Operating Income$-88,640,840$-67,500,000Net Income
$0$300.0M$600.0MRevenueGross ProfitOperating IncomeNet Income

RXT Revenue by Segment

Public Cloud$406.8M−2.3%
Private Cloud$263.3M+5.5%

Figures from SEC filings and company reports. Not investment advice.