Rackspace Technology's Q3 revenue slightly beats analyst expectations

Rackspace Technology

06/11/2025 21:35

Overview

Rackspace Q3 revenue of $671 mln slightly beats analyst expectations

Adjusted EPS for Q3 meets analyst expectations

Outlook

Rackspace expects Q4 2025 revenue between $664 mln and $678 mln

Company sees Q4 2025 Private Cloud revenue at $244 mln to $252 mln

Rackspace forecasts Q4 2025 Public Cloud revenue of $420 mln to $426 mln

Result Drivers

HYBRID MULTICLOUD STRATEGY - CEO Gajen Kandiah emphasized Rackspace's focus on hybrid multicloud solutions, including work with VMware Cloud Foundation

AI AND SECURITY SERVICES - Rackspace continues to deliver modern services for AI, data, and security, enhancing reliability for critical workloads

CASH FLOW STRENGTH - Company generated strong cash flow, with operating activities contributing $71 mln in Q3

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q3 Revenue
Slight Beat*
$671.20 mln
$666.83 mln (3 Analysts)
Q3 Adjusted EPS
Meet
-$0.05
-$0.05 (2 Analysts)
Q3 Net Income
-$67.10 mln
Q3 Adjusted Operating Income
Beat
$32 mln
$31 mln (1 Analyst)
Q3 Capex
$34 mln
Q3 Gross Profit
$129.90 mln


*Applies to a deviation of less than 1%; not applicable for per-share numbers.

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 $1.50, about 3.3% below its November 5 closing price of $1.55

Press Release: ID:nGNX4TgRt7

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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.)