Portnoy Law Firm Announces Class Action on Behalf of Rackspace Technology, Inc. Investors

LOS ANGELES, Aug. 10, 2026 (GLOBE NEWSWIRE) -- The Portnoy Law Firm advises Rackspace Technology, Inc., (“Rackspace” or the "Company") (NASDAQ: RXT) investors of a class action on behalf of investors that bought securities between May 7, 2026 and July 8, 2026, inclusive (the “Class Period”). Rackspace investors have until Septrember 28, 2026 to file a lead plaintiff motion.

Investors are encouraged to contact attorney Lesley F. Portnoy, by phone 310-692-8883 or email: lesley@portnoylaw.com, to discuss their legal rights, or join the case via https://portnoylaw.com/rackspace-technology-inc. The Portnoy Law Firm can provide a complimentary case evaluation and discuss investors’ options for pursuing claims to recover their losses.

Rackspace is a hybrid cloud and AI solutions company that owns and operates physical infrastructure to host cloud services and artificial intelligence.  Its Private Cloud segment offers programmatic infrastructure, cloud operating systems, platform-as-a-service, as well as cloud services tailored toward specific use cases.  Its Public Cloud segment bundles public cloud infrastructure with Rackspace’s expertise and managed services to deploy customers’ applications on the public cloud platforms.  Rackspace also provides Rackspace AI, a portfolio of AI services and solutions to help organizations scale AI adoption.

The Rackspace class action lawsuit alleges that defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose that: (i) Rackspace’s enterprise AI efforts would require Rackspace to significantly re-prioritize its capacity and capital away from the profitable Private Cloud segment; (ii) Rackspace’s Public Cloud revenue was declining as customers contracted directly with hyperscale cloud platforms; (iii) as a result, Rackspace was likely to significantly reduce a material portion of its Public Cloud infrastructure resale business; and (iv) as a result, Rackspace’s fiscal year 2026 revenue would be significantly impacted.

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.”  Rackspace allegedly 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 Rackspace class action lawsuit further alleges that Rackspace also cut its full year 2026 Private Cloud revenue outlook by $25 million and explained that “[l]ower near-term margins reflect upfront growth investment and restructuring, ahead of AI revenue ramping.”  On this news, the price of Rackspace stock dropped nearly 34%, according to the complaint.

The Portnoy Law Firm represents investors in pursuing claims caused by corporate wrongdoing. The Firm’s founding partner has recovered over $5.5 billion for aggrieved investors. Attorney advertising. Prior results do not guarantee similar outcomes.

Lesley F. Portnoy, Esq.
Admitted CA, NY and TX Bar
lesley@portnoylaw.com
310-692-8883
www.portnoylaw.com 

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