Rackspace Tech

Q1 FY2026 EarningsFY26 revenue guidance was revised downward to $2.50B (midpoint), down 7% YoY, primarily due to the strategic exit from low-margin Public Cloud resale and colocation services. Q2 FY26 preliminary revenue is expected at $641M–$649M with a GAAP net loss of $62M–$91M. Despite near-term top-line compression, the company is pivoting to Enterprise AI, targeting 30 MW of capacity by 2028 with anticipated Adjusted EBITDA margins exceeding 50%. A strategic partnership with Palantir names Rackspace a preferred partner for regulated markets.