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Rackspace Technology (RXT) Q1 2026 Earnings
Reported May 7, 2026 at 8:09 AM ET · SEC Source
Q1 26 EPS
$-0.06
MISS 86.34%
Est. $-0.03
Q1 26 Revenue
$678.1M
BEAT +2.61%
Est. $660.8M
vs S&P Since Q1 26
+53.1%
BEATING MARKET
RXT +54.4% vs S&P +1.3%
Market Reaction
Did RXT Beat Earnings? Q1 2026 Results
Rackspace Technology delivered a mixed first quarter for fiscal 2026, beating revenue expectations while falling well short on the bottom line. The company posted revenue of $678.10 million, up 1.9% year over year and ahead of the $660.83 million con… Read more Rackspace Technology delivered a mixed first quarter for fiscal 2026, beating revenue expectations while falling well short on the bottom line. The company posted revenue of $678.10 million, up 1.9% year over year and ahead of the $660.83 million consensus estimate, but reported a non-GAAP loss per share of $0.06, missing the $0.03 consensus by 86.34% as gross margin compressed to 17.6% from 19.1% a year ago, with cost of revenue growing faster than the top line. The results reflected a tale of two segments: Public Cloud revenue climbed 7% to $443.40 million on enterprise cloud migration demand, while Private Cloud slipped 6% to $234.70 million as legacy infrastructure continued to erode. A non-binding memorandum of understanding with AMD to develop managed enterprise AI infrastructure drew investor attention, helping fuel a sharp rally in the shares. Looking ahead, management guided full-year 2026 revenue of $2.60 billion to $2.70 billion and Adjusted EBITDA of $305 million to $315 million, while projecting a non-GAAP loss per share of $0.15 to $0.20.
Key Takeaways
- • Public Cloud revenue growth of 7% YoY driven by enterprise cloud migration
- • Non-GAAP Operating Profit increased 20% YoY to $31 million
- • Adjusted EBITDA improved to $71.2 million from $61.3 million YoY
- • SG&A expenses decreased 17.2% YoY
- • $55.8 million gain on debt extinguishment contributed to GAAP net income swing
- • Corporate function costs reduced by 9.1% YoY
RXT Forward Guidance & Outlook
For full-year 2026, Rackspace guided total revenue of $2,600–$2,700 million, with Private Cloud revenue of $1,025–$1,075 million and Public Cloud revenue of $1,575–$1,625 million. Non-GAAP Operating Profit is expected at $160–$170 million, Adjusted EBITDA at $305–$315 million, and Non-GAAP Loss Per Share of ($0.15)–($0.20). Non-GAAP Other Income (Expense) is expected at ($220)–($230) million with a Non-GAAP Tax Expense Rate of 26% and Non-GAAP Weighted Average Shares of 250–260 million.
RXT YoY Financials
Q1 2026 vs Q1 2025, source: SEC Filings
RXT Revenue by Segment
With YoY comparisons, source: SEC Filings
“The market is moving in the direction we anticipated, with regulated enterprises making deliberate choices about where their AI runs, who operates it, and who is accountable for outcomes.”
— Gajen Kandiah, Q1 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
4 quarters of earnings data
| Quarter | EPS Est. | EPS Act. | Surprise | Revenue | Rev. Surprise |
|---|---|---|---|---|---|
| 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% |