Rackspace Technology (NASDAQ:RXT) Issues Earnings Results, Beats Expectations By $0.01 EPS

Key Points

• Rackspace Technology beat quarterly expectations: It reported an adjusted loss of $0.08 per share versus the $0.09 consensus loss estimate, while revenue of $670.1 million exceeded forecasts of $646 million.
• Shares fell 3.5% to $4.73 despite the earnings beat. Analysts remain cautious, with the stock carrying an average “Reduce” rating and a $2.70 consensus price target.
• Legal uncertainty is weighing on the company: Securities class-action lawsuits allege misleading statements related to Rackspace’s enterprise-AI efforts, although no wrongdoing has been established.

Rackspace Technology (NASDAQ:RXT - Get Free Report) released its earnings results on Monday. The company reported ($0.08) earnings per share (EPS) for the quarter, beating analysts' consensus estimates of ($0.09) by $0.01, FiscalAI reports. The business had revenue of $670.10 million for the quarter, compared to analyst estimates of $646.00 million.

Rackspace Technology Trading Down 3.5%

Shares of RXT stock traded down $0.17 on Monday, hitting $4.73. The stock had a trading volume of 6,406,654 shares, compared to its average volume of 21,880,053. Rackspace Technology has a twelve month low of $0.39 and a twelve month high of $8.60. The firm has a market cap of $1.20 billion, a P/E ratio of -7.75 and a beta of 3.05. The company has a fifty day moving average price of $5.34 and a two-hundred day moving average price of $3.16.

Key Stories Impacting Rackspace Technology

Here are the key news stories impacting Rackspace Technology this week:

• Positive Sentiment: No clearly positive company-specific catalyst was reported in the latest coverage.
• Neutral Sentiment: Rackspace is expected to report quarterly earnings on Tuesday. The results, outlook and commentary on its cloud-services business and enterprise artificial-intelligence strategy could become the next major trading catalyst. Rackspace Technology Expected to Release Quarterly Earnings
• Negative Sentiment: Several investor-rights firms announced that a securities class action has been filed against Rackspace and certain executives. The case covers investors who purchased securities from May 7 through July 8, 2026, and alleges violations of federal securities laws, including material misstatements or omissions related to the company’s enterprise-AI efforts. These are allegations, and no conclusion of wrongdoing has been established. Rackspace Technology Investors Class Action Notice
• Negative Sentiment: The notices repeatedly reference a 33% stock plunge during the proposed class period and urge affected shareholders to seek lead-plaintiff status by September 28, 2026. The litigation adds legal, financial and reputational uncertainty ahead of the earnings release. Kaplan Fox Rackspace Class Action Alert

Wall Street Analysts Forecast Growth

RXT has been the topic of a number of recent research reports. Royal Bank Of Canada raised their price objective on shares of Rackspace Technology from $2.50 to $4.00 and gave the company a "sector perform" rating in a research note on Wednesday, June 17th. Weiss Ratings reissued a "sell (d-)" rating on shares of Rackspace Technology in a research note on Tuesday, June 2nd. Two investment analysts have rated the stock with a Hold rating and one has assigned a Sell rating to the company's stock. According to data from MarketBeat, Rackspace Technology has an average rating of "Reduce" and an average target price of $2.70.

Insider Buying and Selling

In other Rackspace Technology news, CFO Mark A. Marino sold 48,099 shares of Rackspace Technology stock in a transaction dated Thursday, June 4th. The stock was sold at an average price of $5.56, for a total transaction of $267,430.44. Following the transaction, the chief financial officer directly owned 3,370,431 shares in the company, valued at approximately $18,739,596.36. The trade was a 1.41% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders own 2.30% of the company's stock.

Hedge Funds Weigh In On Rackspace Technology

Institutional investors have recently modified their holdings of the business. Creative Planning grew its position in shares of Rackspace Technology by 114.2% in the 2nd quarter. Creative Planning now owns 25,715 shares of the company's stock valued at $33,000 after purchasing an additional 13,708 shares during the period. Jump Financial LLC acquired a new position in shares of Rackspace Technology in the fourth quarter valued at approximately $34,000. Engineers Gate Manager LP increased its position in shares of Rackspace Technology by 47.1% during the second quarter. Engineers Gate Manager LP now owns 34,777 shares of the company's stock worth $45,000 after acquiring an additional 11,141 shares in the last quarter. Steward Partners Investment Advisory LLC raised its holdings in shares of Rackspace Technology by 3,385.4% during the fourth quarter. Steward Partners Investment Advisory LLC now owns 64,828 shares of the company's stock worth $63,000 after acquiring an additional 62,968 shares during the period. Finally, XTX Topco Ltd lifted its position in Rackspace Technology by 62.8% in the 2nd quarter. XTX Topco Ltd now owns 57,682 shares of the company's stock valued at $74,000 after acquiring an additional 22,243 shares in the last quarter. Institutional investors own 82.48% of the company's stock.

Rackspace Technology Company Profile

Rackspace Technology NASDAQ: RXT is a leading provider of managed multi-cloud solutions and services, specializing in the deployment, management and optimization of public and private cloud environments. The company helps organizations design and operate applications across platforms such as Amazon Web Services (AWS), Microsoft Azure, Google Cloud and its own private cloud infrastructure. Rackspace's core offerings include cloud migration, application modernization, data protection, security services and 24x7x365 operational support.

Beyond cloud hosting, Rackspace offers a range of professional services designed to accelerate digital transformation initiatives.

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