Rackspace Technology (RXT) Stock Drops 20% After Rally — AI Cloud Push with AMD Partnership Sparks 300% Monthly Surge Debate

Quick overview

Rackspace Technology, Inc. stock is not showing good performance today, but if we look at the previous days, this stock has shown very positive performance and gained more than 300% in one month. At the time we are writing this article, this stock is trading at $5.82, which is showing a very big 20 percent loss today

Rackspace Technology is a company that builds computing clouds for large companies, which they use to store their data on internet servers instead of saving it on their computers.

The special thing about this company is that it mixes both private cloud and public clouds and gives companies the benefits of both. For example, public accounts like Amazon and Microsoft are very cheap and very fast and easy to use, but on the other hand private clouds are very expensive but more secure and you also have more control over them. So when this company mixes both of these clouds, then the customer gets the benefits of both. This is why there is a very high demand for this company’s services in the market.

Revenue Growth Improves Company Outlook

Now let’s talk about the things that affect this company’s performance, the first of which is its first quarter 2026 earnings report. According to this report, the company made $678 million in sales in its first three months of 2026, which is 2 percent more compared to the same quarter last year. In addition, their public cloud segment increased by 7 percent and it made $443 million in sales, but the private cloud segment decreased by 6 percent and it only made $235 million in sales.

Not only this, the company recorded an $8 million profit in this quarter, but if we look at the same quarter last year, they had suffered a very large loss. However, the reason being given for this improvement is that the company has reduced some of its old debts at lower costs.

AMD Deal Boosts Stock Growth

On the other side of the story, the company has recently made a very big partnership with an AMD chip making company, which has helped this company a lot, and after this partnership the company’s stock had increased a lot.

According to the agreement, Rackspace will build a special enterprise AI cloud system using AMD’s powerful chips, and this system will be designed for companies that run AI systems on a very large scale and need security and strict control for their AI systems. This will be very beneficial for these companies. In addition, this partnership will prove to be very beneficial for both Rackspace company and AMD company in the future.

After this amazing partnership news, the company’s stock went up very quickly, and on the 7th of May it saw almost a 50 percent increase in a single day, which proves to be a very big achievement for this company.

Future Plans, Debt, and AI Growth

Despite so many positive news, the company has not changed its future plans much, and they have kept their future full-year target price the same without any change. They expect that their total annual sales will be between $2.6 billion and $2.7 billion. However, their focus has shifted more towards AI and secure cloud services because it has been observed that Rackspace Technology is trying to shift itself from a cloud company to a modern AI cloud company.

However, the reason for this could be that their public cloud is growing very fast, but their private cloud part has decreased quite a lot, so now their focus is more towards becoming a modern AI cloud company. As of today, there is no such major news or any update that affects this company’s stock.

ABOUT THE AUTHOR See More

Arslan Butt

Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.