Rackspace Q2 revenue beats analyst estimates on private cloud growth

Rackspace Technology

10/08/2026 21:17

Overview
Global enterprise AI solutions provider's Q2 revenue rose 1% yr/yr, beating analyst expectations
Private cloud revenue grew 5% yr/yr, while public cloud revenue declined 2% yr/yr
Company cited enterprise AI platform expansion and new product launches as drivers for Q2

Outlook
Company sees FY 2026 revenue of $2.45 bln to $2.55 bln
Company expects FY 2026 Private Cloud revenue of $1.0 bln to $1.05 bln
Company forecasts FY 2026 Public Cloud revenue of $1.45 bln to $1.5 bln

Result Drivers
PRIVATE CLOUD GROWTH - Co attributed 5% yr/yr private cloud revenue increase to expansion across installed base
AI PLATFORM LAUNCH - Co said launch of Managed Compute and Inference Platform contributed to Q2 results
REGULATED INDUSTRY DEMAND - CEO said enterprises in regulated industries are moving AI from experimentation into production

Company press release: ID:nGNXbf3sRR

Key Details
Metric
Beat/Miss
Actual
Consensus Estimate
Q2 Revenue
Beat
$670.10 mln
$646 mln (3 Analysts)
Q2 Adjusted Loss Per Share
Beat
$0.08
$0.09 (2 Analysts)
Q2 Net Loss
 
$67.50 mln
 
Q2 Adjusted Operating Income
Beat
$27 mln
$25.88 mln (2 Analysts)
Q2 Capex
 
$28 mln
 
Q2 Gross Profit
 
$114.80 mln
 

Analyst Coverage
The current average analyst rating on the shares is "hold" and the breakdown of recommendations is no "strong buy" or "buy", 3 "hold" and no "sell" or "strong sell"
The average consensus recommendation for the it services & consulting peer group is "buy."
Wall Street's median 12-month price target for Rackspace Technology Inc is $5.00, about 2% above its August 7 closing price of $4.90

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)