Q2 26 EPS Adjusted
$-0.08
BEAT +11.21%
Est. $-0.09
Q2 26 Revenue
$670.1M
BEAT +3.73%
Est. $646.0M
vs S&P Since Q2 26
-15.8%
TRAILING MARKET
RXT -15.0% vs S&P +0.8%
Market Reaction
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 milli… Read more 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
RXT 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, source: SEC Filings
RXT Revenue by Segment
With YoY comparisons, source: SEC Filings
“Enterprises in regulated industries are moving AI from experimentation into production, and they are choosing partners who can be accountable for it.”
— Gajen Kandiah, Q2 2026 Earnings Press Release
RXT Earnings Trends
RXT vs Market 30 Day Price Reactions
30-day stock return vs benchmark after each earnings
RXT EPS Trend
Earnings per share: estimate vs actual
RXT Revenue Trend
Quarterly revenue: estimate vs actual
RXT Quarterly Results
5 quarters of earnings data
| Quarter | EPS Est. | EPS Act. | Surprise | Revenue | Rev. Surprise |
|---|---|---|---|---|---|
| Q2 26 BEAT | $-0.09 | $-0.08 | +11.21% | $670.1M | +3.73% |
| Q1 26 MISS | $-0.03 | $-0.06 | -86.34% | $678.1M | +2.61% |
| Q4 25 BEAT FY | $-0.03 | $-0.01 | +65.40% | $682.8M | +1.52% |
| FY Full Year | — | $-0.18 | — | $2.69B | — |
| Q3 25 BEAT | $-0.05 | $-0.05 | +1.19% | $671.2M | +0.65% |
| Q2 25 MISS | $-0.05 | $-0.06 | -10.70% | $666.3M | +1.13% |