Rackspace Stock (RXT) Jumps in Pre-Market Again after 68% Rally — Here’s Why

FomoAnxiety · 2026-02-27T08:25:28+00:00

Rackspace Technology shares jumped 68% after strong Q4 results, with revenue of $683 million and improved outlook for a turnaround. The company announced a partnership with Palantir, enhancing its AI offerings, although analysts remain cautious with a consensus rating of Hold.

FomoAnxiety

2026-02-27 08:25:28

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Rackspace Technology RXT +68.89% ▲ shares surged about 68% in Thursday’s trading and were up another 11% in premarket trading on Friday, making the cloud services provider one of the biggest movers in the market. The rally followed the company’s fourth-quarter results, which came in better than feared and improved the outlook for its turnaround.

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Q4 Earnings Snapshot

Rackspace reported $683 million in Q4 revenue and generated $60 million in operating cash flow, while non-GAAP operating profit reached $41 million, above the high end of guidance. The company also ended the year with roughly $397 million in total liquidity, easing balance-sheet concerns and helping support the turnaround story.

The company also gave 2026 guidance for $2.6 billion to $2.7 billion in revenue and $160 million to $170 million in operating profit, pointing to better profits as the turnaround continues.

Sentiment had already started improving earlier this month after Rackspace announced a partnership with Palantir Technologies PLTR +1.30% ▲ . Under the agreement, Rackspace will help enterprises deploy and operate Palantir’s Foundry and Artificial Intelligence Platform (AIP), linking the company more directly to growing enterprise AI spending.

Is Rackspace Technology Stock a Buy, Sell, or Hold?

Turning to Wall Street, the analysts’ consensus rating for Rackspace Technology is Hold, based on one Hold rating over the past three months. With that comes an average RXT stock price target of $1.30, representing potential 42.98% downside for the shares.

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