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.)