Companies /Technology

Rackspace Technology Inc

NASDAQ: RXT Software - Infrastructure
$3.29
▲ $0.28 (+9.30%) today
Markets closed · 8:21pm ET

Q1 2026 Earnings

Reported May 7, 2026, 8:09am ET · SEC source
$-0.06
Miss −86.34%
EPS · est. $-0.03
$678.1M
Beat +2.61%
Revenue · est. $660.8M
+31.6%
Beating market
RXT vs S&P since report
1 quarter
Consecutive EPS beats

Market Reaction

% change · around the report
0+50%+100%+150%May 7May 8report 8:09am ETearnings+0.4%+136.4%
0+50%+100%+150%May 7May 8earnings+0.4%+136.4%
RXT +136.4%S&P 500 +0.4%
0+50%+100%+150%May 7May 8report 8:09am ETearnings+2.0%+136.4%
0+50%+100%+150%May 7May 8earnings+2.0%+136.4%
RXT +136.4%NASDAQ +2.0%
−50%0+50%+100%May 6May 15report 8:09am ETearnings+0.5%+88.3%
−50%0+50%+100%May 6May 15earnings+0.5%+88.3%
RXT +88.3%S&P 500 +0.5%
−50%0+50%+100%May 6May 15report 8:09am ETearnings+1.5%+88.3%
−50%0+50%+100%May 6May 15earnings+1.5%+88.3%
RXT +88.3%NASDAQ +1.5%
+55.07%
Day of report
+55.97%
Next session
+107.10%
One week
+32.39%
30 days

S&P 500 over the same 30 days: +0.75%.

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 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

“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.”

Rackspace Technology CEO, on the earnings call

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 · SEC filings Q1 2025 Q1 2026
$0$200.0M$400.0M$600.0M$665.4M$678.1MRevenue$126.9M$119.1MGross Profit$-11,584,771$-17,800,000Operating Income$3.9M$8.3MNet Income
$0$200.0M$400.0M$600.0MRevenueGross ProfitOperating IncomeNet Income

RXT Revenue by Segment

Public Cloud$443.4M+6.7%
Private Cloud$234.7M−6.0%

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