NEW YORK--(BUSINESS WIRE)--Sep 28, 2026--
Faruqi & Faruqi, LLP, a leading national securities law firm, is investigating potential claims against Rackspace Technology, Inc. (“Rackspace” or the “Company”) (NASDAQ: RXT) and reminds investors of the September 28, 2026 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
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Faruqi & Faruqi is a leading national securities law firm with offices in New York, Pennsylvania, California and Georgia. The firm has recovered hundreds of millions of dollars for investors since its founding in 1995. See www.faruqilaw.com.
As detailed below, the complaint alleges that the Company and its executives violated federal securities laws by making false and/or misleading statements and/or failing to disclose that: (1) the Company’s enterprise AI efforts would require Rackspace to significantly re-prioritize its capacity and capital away from the profitable Private Cloud segment; (2) that Rackspace’s Public Cloud revenue was declining as customers contracted directly with hyperscale cloud platforms; (3) that, as a result, Rackspace was likely to significantly reduce a material portion of its Public Cloud infrastructure resale business; (4) as a result, the Company’s fiscal year 2026 revenue would be significantly impacted; and (5) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
On July 9, 2026, before the market opened, Rackspace published second quarter 2026 financial results and “a strategic and financial update on its transition to becoming the operator of the full enterprise AI stack.” The Company revealed that its AI investments would require a significant re-prioritization of resources and, as a result, reduced its full year 2026 revenue guidance by $150 million. The Company also cut its full year 2026 Private Cloud revenue outlook by $25 million. Finally, the Company explained that “[l]ower near-term margins reflect upfront growth investment and restructuring, ahead of AI revenue ramping.”
On this news, Rackspace’s stock price fell $2.21, or 33.6%, to close at $4.37 per share on July 9, 2026, thereby injuring investors.
The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.
Faruqi & Faruqi, LLP also encourages anyone with information regarding Rackspace Technology’s conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
To learn more about the Rackspace Technology class action, go to www.faruqilaw.com/RXT or call Faruqi & Faruqi partner Josh Wilson directly at 877-247-4292 or 212-983-9330 (Ext. 1310).
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Frequently Asked Questions (FAQ) for Investors Regarding the Rackspace Technology Securities Class Action Lawsuit:
What is the Rackspace Technology securities fraud lawsuit about?
The lawsuit alleges Rackspace Technology misled investors by understating the financial impact of its AI strategy, declining Public Cloud business, and reduced infrastructure resale revenue.
Who may be eligible to participate in the lawsuit?
Investors who purchased Rackspace Technology, Inc. (NASDAQ: RXT) securities during the alleged Class Period may be eligible if they suffered losses.
What is a lead plaintiff, and how can I seek appointment?
A lead plaintiff represents the proposed class during the litigation. Eligible investors must file a motion with the court by September 28, 2026. Investors may participate without serving as lead plaintiff.
What should investors do if they purchased Rackspace Technology stock during the Class Period?
Investors should review their trading records and consider consulting counsel about their legal rights, participation in the lawsuit, or seeking appointment as lead plaintiff.
Why should investors contact Faruqi & Faruqi, LLP?
Faruqi & Faruqi, LLP has represented investors in securities litigation for decades and has recovered hundreds of millions of dollars for shareholders. Investors who purchased Rackspace Technology securities during the Class Period may contact the firm to discuss their legal rights, potential claims, and the lead plaintiff process at no cost or obligation.
Attorney Advertising. The law firm responsible for this advertisement is Faruqi & Faruqi, LLP ( www.faruqilaw.com ). Prior results do not guarantee or predict a similar outcome with respect to any future matter. We welcome the opportunity to discuss your particular case. All communications will be treated in a confidential manner.
RXT CLASS ACTION DEADLINE TONIGHT: Faruqi & Faruqi, LLP Reminds Rackspace Technology (RXT) Investors of Securities Class Action Lawsuit Deadline on September 28, 2026
