Rackspace Posts 2% Q1 Revenue Growth to $678M, Partners with AMD on AI Infrastructure
Rackspace reported Q1 revenue of $678 million, up 2%, with Public Cloud up 7% to $443 million and Private Cloud down 6% to $235 million, delivering an $8 million profit versus a $72 million loss in Q1 2025. It signed an MOU with AMD to build governed enterprise AI infrastructure.
1. First Quarter Financial Results
Rackspace generated $678 million in Q1 revenue, up 2% year-over-year, driven by a 7% increase in Public Cloud to $443 million despite a 6% decline in Private Cloud to $235 million. Loss from operations narrowed to $18 million and net income reached $8 million, compared to a $72 million net loss in Q1 2025, with cash of $94 million and $295 million total liquidity.
2. AMD Partnership Details
Rackspace signed a Memorandum of Understanding with AMD to establish a governed Enterprise AI Cloud integrating AMD Instinct GPUs and EPYC CPUs. The agreement outlines four integrated capabilities: a fully managed private AI cloud, context-aware inference engine, inference as a service with dedicated GPUs, and bare metal AMD Instinct compute, all under a governed operating model.
3. Outlook and Guidance
Rackspace reiterated full-year 2026 guidance for $2.6–$2.7 billion in total revenue, with $1.025–$1.075 billion in Private Cloud and $1.575–$1.625 billion in Public Cloud. Management expects Non-GAAP operating profit of $160–$170 million, Adjusted EBITDA of $305–$315 million, and a non-GAAP loss per share of $0.15–$0.20.