The market is completely mispricing $RXT (Rackspace).
Varun Takkar @varuntakkar01
A 33% haircut over “lowered 2026 revenue guidance” is the ultimate trap for retail focused on the short-term top line. Here is why I am incredibly bullish on the structural pivot happening under the hood. 🧵👇
​1. The old Rackspace is dead.
They are actively shedding legacy, low-margin cloud hosting revenue streams. Why? To become the undisputed operator of the full Enterprise AI Stack. Management is intentionally taking a short-term revenue hit to transition into governed AI infrastructure, unlocking a massive revenue and EBITDA growth vector by 2027.
​2. The $PLTR Catalyst
Rackspace was just named Palantir’s preferred partner for deploying Foundry and AIP in highly regulated and sovereign markets. Defense, healthcare, and finance can’t dump sensitive data into public clouds.
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​3. Beyond Palantir: The AI Ecosystem
$RXT is quietly assembling a best-of-breed AI ecosystem that the market is completely ignoring.
​🤝$AMD: Rackspace just signed a definitive agreement for a 30 MW phased deployment of dedicated AMD AI compute (including MI355X and MI350P GPUs) across their global data centers. They are offering a governed AI stack from the silicon layer straight to the business outcome.
​4. Sovereign Security & Agents🤝 Rubrik $RBRK: They partnered to launch a Sovereign Cyber Recovery Cloud. Governments and critical infrastructure can now detect threats and recover data inside fully sovereign environments.
🤝 Uniphore: A strategic partnership to define the industry’s first “Infrastructure-to-Agents Architecture”. They are building the actual plumbing required for Enterprise AI agents to run securely at scale.
​5. The Setup
Add in their deep integrations with Dell and VMware, and the moat becomes undeniable. Short-term revenue takes a hit while they renovate the business model, but the end result is a high-margin, enterprise-grade AI fortress.
​The smart money is looking past the 2026 guidance noise and pricing in the 2027 AI compute margins. I’ll be watching the moving averages closely for a base to form here and maybe grab a small position for August OPEX.