NEW YORK, Aug. 11, 2026 /PRNewswire/ -- Wolf Haldenstein Adler Freeman & Herz LLP, a nationally recognized securities litigation law firm, informs investors that a securities fraud class action lawsuit has been filed against Rackspace Technology, Inc. (NASDAQ: RXT) ("Rackspace "or the "Company") on behalf of those who purchased or acquired Rackspace securities between May 7, 2026 and July 8, 2026, inclusive. Â
Investors who purchased Rackspace common stock during the class period and suffered losses may be eligible to participate in the case, with the lead plaintiff deadline set for September 28, 2026.
The filed complaint alleges that, throughout the Class Period, Defendants made materially false and/or misleading statements and failed to disclose material adverse facts about the Company's business, operations, and prospects.
Specifically, Defendants misrepresented and/or failed to disclose that:
Rackspace's enterprise AI efforts would require the company to significantly re-prioritize its capacity and capital away from the profitable Private Cloud segment;
Rackspace's Public Cloud revenue was declining as customers contracted directly with hyperscale cloud platforms;
as a result, Rackspace was likely to significantly reduce a material portion of its
Public Cloud infrastructure resale business;
consequently, Rackspace's fiscal year 2026 revenue would be significantly impacted; and
because 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 its second quarter 2026 financial results and disclosed "a strategic and financial update on its transition to becoming the operator of the full enterprise AI stack." Specifically, Rackspace 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. 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, Rackspace's stock price fell $2.21 per share, or 33.6%, to close at $4.37 per share on July 9, 2026.
WHY WOLF HALDENSTEIN?
This illustrious firm, founded in 1888, is steadfast in their pursuit of justice for investors who have suffered financial harm due to these misrepresented statements. The law firm brings to the fore over 125 years of legal expertise in securities litigation and has a proven record of protecting the rights of investors.
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Keep it Clean. Please avoid obscene, vulgar, lewd, racist or sexually-oriented language.
PLEASE TURN OFF YOUR CAPS LOCK.
Don't Threaten. Threats of harming another person will not be tolerated.
Be Truthful. Don't knowingly lie about anyone or anything.
Be Nice. No racism, sexism or any sort of -ism that is degrading to another person.
Be Proactive. Use the 'Report' link on each comment to let us know of abusive posts.
Share with Us. We'd love to hear eyewitness accounts, the history behind an article.