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Rackspace Technology, Inc. (RXT) Financials

RXT
Trailing 12 months to June 30, 2026
Revenue $2.7B +0.3% YoY
Net Income -$159.0M +56.9% YoY
EPS (Diluted) -$0.65 +59.1% YoY
Free Cash Flow $41.0M -23.5% YoY
Market Cap $720.0M as of Oct 17, 2026
Price / Sales 0.3x on $2.7B revenue, trailing 12 months to June 30, 2026
Price / Earnings n/m net loss, so no earnings multiple, trailing 12 months to June 30, 2026
Price / Book n/m negative shareholder equity, so no book multiple, Q2 FY2026

A multiple compares the market's price with a filed figure; it says what the market pays, not how the business is doing. The market capitalization is the vendor's as of Oct 17, 2026; every other figure is from the SEC filings on this page. Not financial advice.

Source SEC Filings (10-K/10-Q) Latest period Q2 FY2026, ended Jun 30, 2026 Reported Currency USD FYE December

Newest figures come from the 10-Q for Q2 FY2026, filed Aug 10, 2026. Each column of the statement tables below links to the filing it was taken from, and every filing is listed on the RXT SEC filings page.

Rackspace Technology, Inc. (RXT) reported $2.7B in revenue over the twelve months to Jun 30, 2026, up 0.3% from the prior twelve months. This page shows its income statement, balance sheet, cash flow statement, and key financial ratios. View 8 years of annual fundamentals and quarterly data, with year-over-year growth rates and compound annual growth rates (CAGR). All figures are derived from SEC filings (10-K and 10-Q reports).

Rhea AI RXT FY2025

Rackspace’s 2025 recovery came from sharply lower operating costs and improved cash generation, not renewed revenue growth or gross-margin expansion.

Revenue fell 1.9% while gross margin slipped to 18.9% in FY2025, yet operating margin improved to -3.8%; the rebound therefore came mainly from costs below gross profit rather than stronger demand or better delivery economics. Cash conversion also returned: EBITDA reached $230M while operating cash flow reached $151M, showing that the accounting recovery produced cash instead of remaining purely non-cash.

The balance sheet is structurally thin: liabilities of $4.0B exceeded assets of $2.8B in FY2025, leaving negative equity and a current ratio of 0.7x. That combination means the company’s financing claims exceed its recorded asset base, making conventional equity-based leverage measures less informative.

Free cash flow moved from -$71M in FY2024 to $91M in FY2025, linking the earnings improvement to actual cash generation. Capital demands also eased: capital expenditures fell from $111M to $61M, so the cash improvement reflects both better operations and lighter reinvestment.

[ NOT FINANCIAL ADVICE ]

Financial Health Signals

Profitability Growth Leverage Liquidity CashFlow Returns 18 / 100
Financial Health Score 18/100

Scored against operating companies for FY2025. Each of the six dimensions is a percentile rank within that peer group; the overall is their average, with missing dimensions counted as zero out of six. A high score means strong standing among peers, not absolute cross-industry strength. How this score is calculated →

Health score ≠ stock price. This rates the quality of Rackspace Technology, Inc.'s business: profitability, growth, balance sheet strength. It doesn't tell you whether the stock is a good buy at today's price. Not financial advice. Use it alongside valuation analysis and your own research.

Profitability
21

Rackspace Technology, Inc. has an operating margin of -3.8%, meaning the company loses $4 on every $100 of revenue. This results in a profitability score of 21/100. This is up from -33.2% the prior year.

Growth
17

Rackspace Technology, Inc.'s revenue declined 1.9% year-over-year, from $2.7B to $2.7B. This contraction results in a growth score of 17/100.

Leverage
4
Liquidity
8

Rackspace Technology, Inc.'s current ratio of 0.68 is below the typical benchmark, resulting in a score of 8/100. This tight liquidity could limit financial flexibility if cash inflows slow.

Cash Flow
36

Rackspace Technology, Inc. has a free cash flow margin of 3.4%, earning a moderate score of 36/100. The company generates positive cash flow after capital investments, but with room for improvement.

Returns
19
Altman Z-Score Distress
-1.11

Rackspace Technology, Inc. scores -1.11, below the 1.81 distress threshold. The score is driven primarily by a large market capitalization ($720.0M) relative to total liabilities ($4.0B). This indicates elevated financial distress risk and warrants close attention to liquidity and debt levels.

Distress-screening estimate for non-financial companies. Not computed for banks or insurers, where the Altman model does not apply.

Piotroski F-Score Neutral
4/9

Rackspace Technology, Inc. passes 4 of 9 financial strength tests. 3 of 4 profitability signals pass, no leverage/liquidity signals pass (rising debt, declining liquidity, or share dilution), 1 of 2 efficiency signals pass.

Earnings Quality Mixed
N/A

Rackspace Technology, Inc. reported a net loss of $225.8M while generating $151.4M in operating cash flow. Operations generated cash despite the loss, but with no positive earnings behind it, the ratio between the two carries no quality signal.

Interest Coverage At Risk
N/A

Rackspace Technology, Inc. reported an operating loss of $100.7M against $82.7M in interest expense. There is no operating profit to cover interest, so interest must be met from cash reserves or from financing rather than from operations.

Key Financial Metrics

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Earnings & Revenue

Revenue
$670.1M
YoY+0.6%
QoQ-1.2%
5Y CAGR-2.1%

Rackspace Technology, Inc. generated $670.1M in revenue in Q2 2026. This represents an increase of 0.6% from the same quarter a year earlier. Against the prior quarter it is down 1.2%.

EBITDA
$5.3M
YoY-89.4%
QoQ-76.8%

Rackspace Technology, Inc.'s EBITDA was $5.3M in Q2 2026, measuring earnings before interest, taxes, depreciation, and amortization. This represents a decrease of 89.4% from the same quarter a year earlier. Against the prior quarter it is down 76.8%.

Net Income
-$67.5M
YoY-23.9%
QoQ-913.3%

Rackspace Technology, Inc. reported -$67.5M in net income in Q2 2026. This represents a decrease of 23.9% from the same quarter a year earlier. Against the prior quarter it is down 913.3%.

EPS (Diluted)
-$0.27
YoY-17.4%
QoQ-1000.0%

Rackspace Technology, Inc. earned -$0.27 per diluted share (EPS) in Q2 2026. This represents a decrease of 17.4% from the same quarter a year earlier. Against the prior quarter it is down 1000.0%.

Cash & Balance Sheet

Free Cash Flow
-$48.3M
YoY-289.5%
QoQ-413.8%

Rackspace Technology, Inc. recorded an outflow of $48.3M in free cash flow in Q2 2026, representing a cash shortfall after capex. This represents a decrease of 289.5% from the same quarter a year earlier. Against the prior quarter it is down 413.8%.

Cash & Debt
$110.6M
YoY+6.4%
QoQ+18.2%
5Y CAGR-12.4%

Rackspace Technology, Inc. held $110.6M in cash against $2.8B in long-term debt as of Q2 2026.

Shares Outstanding
255M
YoY+6.5%
QoQ+2.3%
5Y CAGR+4.0%

Rackspace Technology, Inc. had 255M shares outstanding in Q2 2026. This represents an increase of 6.5% from the same quarter a year earlier. Against the prior quarter it is up 2.3%.

Dividends Per Share

Not reported for Q2 2026.

Margins & Returns

Gross Margin
17.1%
YoY-2.3pp
QoQ-0.4pp
5Y change-14.5pp

Rackspace Technology, Inc.'s gross margin was 17.1% in Q2 2026, indicating the percentage of revenue retained after direct costs. This is down 2.3 percentage points from the same quarter a year earlier. Against the prior quarter it is down 0.4 percentage points.

Operating Margin
-5.0%
YoY-1.2pp
QoQ-2.3pp
5Y change-5.3pp

Rackspace Technology, Inc.'s operating margin was -5.0% in Q2 2026, reflecting core business profitability. This is down 1.2 percentage points from the same quarter a year earlier. Against the prior quarter it is down 2.3 percentage points.

Net Margin
-10.1%
YoY-1.9pp
QoQ-11.3pp
5Y change-5.1pp

Rackspace Technology, Inc.'s net profit margin was -10.1% in Q2 2026, showing the share of revenue converted to profit. This is down 1.9 percentage points from the same quarter a year earlier. Against the prior quarter it is down 11.3 percentage points.

Return on Equity

Not reported for Q2 2026.

Capital Allocation

Capital Expenditures
$16.8M
YoY-19.2%
QoQ+15.9%
5Y CAGR-10.4%

Rackspace Technology, Inc. invested $16.8M in capex in Q2 2026, funding long-term assets and infrastructure. This represents a decrease of 19.2% from the same quarter a year earlier. Against the prior quarter it is up 15.9%.

R&D Spending

Not reported for Q2 2026.

Share Buybacks

Not reported for Q2 2026.

RXT Income Statement

Figures in USD, abbreviated K (thousand), M (million), B (billion), T (trillion). Negative values carry a minus sign and red type. Each change compares the year with the year before it, and each quarter with the same quarter a year earlier.

RXT quarterly income statement
MetricQ2'2610-QQ1'2610-QQ4'2510-QQ3'2510-QQ2'2510-QQ1'2510-QQ4'2410-KQ3'2410-Q
Revenue$670.1M+0.6%$678.1M+1.9%$682.8M-0.4%$671.2M-0.7%$666.3M-2.7%$665.4M-3.7%$685.6M-4.7%$675.8M-7.7%
Cost of Revenue$555.3M+3.4%$559.0M+3.8%$562.4M+1.5%$541.3M+0.6%$537.1M-3.0%$538.5M-3.5%$553.9M-2.1%$538.3M-7.3%
Gross Profit$114.8M-11.1%$119.1M-6.1%$120.4M-8.6%$129.9M-5.5%$129.2M-1.7%$126.9M-4.4%$131.7M-14.5%$137.5M-9.5%
SG&A Expenses$148.0M-4.1%$136.9M-17.2%$123.7M-22.9%$163.8M-3.4%$154.3M-16.7%$165.3M-14.1%$160.5M-3.0%$169.5M-4.4%
Operating Income-$33.2M-32.3%-$17.8M+53.6%-$3.3M+88.5%-$33.9M+80.5%-$25.1M+53.3%-$38.4M+94.1%-$28.8M-89.5%-$173.7M+27.4%
EBITDA$5.3M-89.4%$22.8M-35.8%$103.2M+35.1%$41.2M+140.9%$49.9M+145.8%$35.5M+106.1%$76.4M-40.2%-$100.7M+32.6%
Interest Expense$34.2M+60.6%$26.2M+35.1%$20.8M+16.2%$21.2M+17.8%$21.3M+15.8%$19.4M-55.6%$17.9M-64.8%$18.0M-68.1%
Income Tax$1.8M-60.9%-$100K-101.2%$3.1M+542.9%$8.1M-32.5%$4.6M+115.4%$8.2M+274.5%-$700K-107.4%$12.0M+172.7%
Net Income-$67.5M-23.9%$8.3M+111.6%-$32.7M+41.6%-$67.1M+64.0%-$54.5M-318.0%-$71.5M+88.8%-$56.0M-300.0%-$186.6M+17.7%
EPS (Basic)-$0.27-17.4%$0.03+109.7%-$0.13+43.5%-$0.28+65.9%-$0.23-309.1%-$0.31+89.3%-$0.23-264.3%-$0.82+21.9%
EPS (Diluted)-$0.27-17.4%$0.03+109.7%-$0.13+43.5%-$0.28+65.9%-$0.23-309.1%-$0.31+89.3%-$0.23-264.3%-$0.82+21.9%
Diluted Shares (Avg)250M+5.1%250M+7.7%N/A240M+6.2%238M+3.7%232M+5.5%N/A226M+4.8%

Not reported in any period shown, so not listed: R&D Expenses.

RXT Balance Sheet

Figures in USD, abbreviated K (thousand), M (million), B (billion), T (trillion). Negative values carry a minus sign and red type. Each change compares the year with the year before it, and each quarter with the same quarter a year earlier.

RXT quarterly balance sheet
MetricQ2'2610-QQ1'2610-QQ4'2510-QQ3'2510-QQ2'2510-QQ1'2510-QQ4'2410-KQ3'2410-Q
Total Assets$2.7B-5.2%$2.8B-6.8%$2.8B-8.3%$2.8B-9.6%$2.9B-14.7%$3.0B-15.6%$3.1B-25.4%$3.1B-26.5%
Current Assets$555.9M+1.4%$535.1M-8.0%$517.8M-16.3%$540.9M-16.6%$548.4M-21.2%$581.8M-26.2%$618.8M-16.2%$648.7M-23.2%
Cash & Equivalents$110.6M+6.4%$93.6M-26.9%$105.8M-26.5%$99.5M-36.7%$103.9M-45.4%$128.0M-54.7%$144.0M-26.8%$157.1M-43.4%
Short-Term Investments$0$0$0$0$0$0$0$0
Accounts Receivable$278.7M+9.8%$265.8M-1.2%$266.5M-10.8%$273.9M-12.2%$253.9M-21.3%$269.0M-11.3%$298.8M-12.0%$311.8M-10.6%
Long-Term Investments$0$0$0$0$0$0$0$0
Goodwill$738.7M-0.3%$738.8M+0.2%$740.1M+0.6%$739.7M0.0%$741.1M-15.6%$737.3M-16.0%$735.7M-49.3%$739.7M-48.9%
Total Liabilities$4.0B+0.3%$4.0B-1.4%$4.0B-1.0%$4.0B-1.5%$4.0B-3.3%$4.0B-6.1%$4.1B-4.5%$4.1B-8.2%
Current Liabilities$735.5M+2.8%$785.6M+6.9%$766.7M0.0%$766.2M-0.4%$715.4M-7.3%$734.8M-2.5%$766.6M-4.1%$768.9M-6.8%
Non-Current Liabilities$3.3B-0.2%$3.2B-3.3%$3.3B-1.2%$3.3B-1.8%$3.3B-2.4%$3.3B-6.9%$3.3B-4.6%$3.3B-8.6%
Long-Term Debt$2.8B-0.2%$2.7B-2.9%$2.7B-1.4%$2.7B-1.4%$2.8B-1.7%$2.8B-7.2%$2.8B-2.9%$2.8B-7.6%
Total Equity-$1.3B-14.5%-$1.2B-13.4%-$1.2B-21.4%-$1.2B-25.0%-$1.1B-48.0%-$1.1B-36.3%-$1.0B-550.0%-$949.7M-419.5%
Retained Earnings-$4.0B-4.2%-$3.9B-3.9%-$3.9B-6.1%-$3.9B-6.9%-$3.8B-10.7%-$3.8B-8.3%-$3.7B-30.4%-$3.6B-27.1%

Not reported in any period shown, so not listed: Inventory.

RXT Cash Flow Statement

Figures in USD, abbreviated K (thousand), M (million), B (billion), T (trillion). Negative values carry a minus sign and red type. Each change compares the year with the year before it, and each quarter with the same quarter a year earlier.

RXT quarterly cash flow statement
MetricQ2'2610-QQ1'2610-QQ4'2510-QQ3'2510-QQ2'2510-QQ1'2510-QQ4'2410-KQ3'2410-Q
Operating Cash Flow-$31.5M-475.0%$5.1M-59.5%$59.7M+9.9%$70.7M+36.5%$8.4M-65.1%$12.6M+114.0%$54.3M-24.8%$51.8M-80.6%
Depreciation & Amortization$38.5M-48.7%$40.6M-45.1%$74.3M+1.2%$75.1M+2.9%$75.0M+1.2%$73.9M-1.3%$73.4M-15.8%$73.0M-19.0%
Stock-Based Compensation$10.4M+4.0%$6.6M-45.0%N/A$18.2M+17.4%$10.0M-48.7%$12.0M-6.3%N/A$15.5M-9.9%
Capital Expenditures$16.8M-19.2%$14.5M+74.7%$3.7M-81.4%$28.0M+14.3%$20.8M-46.1%$8.3M-70.5%$19.9M-41.3%$24.5M-10.9%
Free Cash Flow-$48.3M-289.5%-$9.4M-318.6%$56.0M+62.8%$42.7M+56.4%-$12.4M+14.5%$4.3M+103.6%$34.4M-10.2%$27.3M-88.6%
Investing Cash Flow-$19.7M+6.6%-$11.5M-30.7%-$3.0M+83.1%-$25.5M-31.4%-$21.1M+45.1%-$8.8M+20.7%-$17.7M+47.5%-$19.4M+29.2%
Financing Cash Flow$68.3M+552.3%-$4.1M+80.1%-$50.0M-8.7%-$48.9M+27.4%-$15.1M+80.6%-$20.6M-110.9%-$46.0M+62.1%-$67.4M+44.1%

Not reported in any period shown, so not listed: Dividends Paid, Share Buybacks.

RXT Financial Ratios

Margins and returns are percentages; the remaining ratios are unitless multiples. Each change compares the year with the year before it, and each quarter with the same quarter a year earlier.

RXT quarterly financial ratios
MetricQ2'2610-QQ1'2610-QQ4'2510-QQ3'2510-QQ2'2510-QQ1'2510-QQ4'2410-KQ3'2410-Q
Gross Margin17.1%-2.3pp17.6%-1.5pp17.6%-1.6pp19.4%-1.0pp19.4%+0.2pp19.1%-0.2pp19.2%-2.2pp20.3%-0.4pp
Operating Margin-5.0%-1.2pp-2.6%+3.1pp-0.5%+3.7pp-5.1%+20.7pp-3.8%+4.1pp-5.8%+88.7pp-4.2%-2.1pp-25.7%+7.0pp
Net Margin-10.1%-1.9pp1.2%+12.0pp-4.8%+3.4pp-10.0%+17.6pp-8.2%-11.8pp-10.8%+82.0pp-8.2%-12.1pp-27.6%+3.3pp
Return on Assets-2.5%-0.6pp0.3%+2.7pp-1.2%+0.7pp-2.4%+3.6pp-1.9%-2.6pp-2.4%+15.8pp-1.8%-2.5pp-5.9%-0.6pp
Current Ratio0.760.0x0.68-0.1x0.68-0.1x0.71-0.1x0.77-0.1x0.79-0.3x0.81-0.1x0.84-0.2x
Asset Turnover0.240.0x0.250.0x0.240.0x0.240.0x0.230.0x0.220.0x0.220.0x0.210.0x
FCF Margin-7.2%-5.3pp-1.4%-2.0pp8.2%+3.2pp6.4%+2.3pp-1.9%+0.3pp0.7%+17.8pp5.0%-0.3pp4.0%-28.6pp

Not reported in any period shown, so not listed: Return on Equity, Debt-to-Equity.

Note: Shareholder equity is negative (-$1.2B), which causes debt-to-equity and return on equity ratios to appear negative or not meaningful. This can occur from accumulated losses or large share buyback programs.

Note: The current ratio is below 1.0 (0.68), indicating current liabilities exceed current assets, which may suggest potential short-term liquidity concerns.

Similar Companies

Newest fiscal year on record for each company. The health score is the peer-relative Financial Health Score for that year; a dash means no score is published for it.

Company Fiscal year Revenue Net income Net margin Market cap Health score
Rackspace Technology, Inc. RXT FY2025 $2.7B -$225.8M -8.4% $720.0M 18/100
Gorilla Technology Group Inc. GRRR FY2025 $101.4M -$11.3M -11.1% $231.4M 49/100
Lesaka Technologies, Inc. LSAK FY2026 $721.6M $2.8M 0.4% $381.8M 40/100
Allot Ltd. ALLT FY2025 $102.0M $3.7M 3.6% $445.7M 65/100
Palladyne AI Corp. PDYN FY2025 $5.2M $10.0M N/A $200.8M 54/100

Frequently Asked Questions

What is Rackspace Technology, Inc.'s annual revenue?

Rackspace Technology, Inc. (RXT) reported $2.7B in total revenue for fiscal year 2025. This represents a -1.9% change compared to the previous fiscal year. Revenue measures the total income earned from the company's primary business operations before any expenses are deducted.

How fast is Rackspace Technology, Inc.'s revenue growing?

Rackspace Technology, Inc. (RXT) revenue declined by 1.9% year-over-year, from $2.7B to $2.7B in fiscal year 2025.

Is Rackspace Technology, Inc. profitable?

No, Rackspace Technology, Inc. (RXT) reported a net income of -$225.8M in fiscal year 2025, with a net profit margin of -8.4%.

Rackspace Technology, Inc. (RXT) reported diluted earnings per share of -$0.95 for fiscal year 2025. This represents a 75.1% change compared to the previous fiscal year. EPS represents the portion of a company's net income allocated to each outstanding share of common stock and is widely used to evaluate profitability on a per-share basis.

Rackspace Technology, Inc. (RXT) had EBITDA of $229.8M in fiscal year 2025, measuring earnings before interest, taxes, depreciation, and amortization.

As of fiscal year 2025, Rackspace Technology, Inc. (RXT) had $105.8M in cash and equivalents against $2.7B in long-term debt.

Rackspace Technology, Inc. (RXT) had a gross margin of 18.9% in fiscal year 2025, indicating the percentage of revenue retained after direct costs of goods sold.

Rackspace Technology, Inc. (RXT) had an operating margin of -3.8% in fiscal year 2025, reflecting the profitability of core business operations before interest and taxes.

Rackspace Technology, Inc. (RXT) had a net profit margin of -8.4% in fiscal year 2025, representing the share of revenue converted into profit after all expenses.

Rackspace Technology, Inc. (RXT) generated $90.6M in free cash flow during fiscal year 2025. This represents a 227.2% change compared to the previous fiscal year. Free cash flow represents the cash a company generates after accounting for capital expenditures, and is widely used to assess financial flexibility and shareholder value.

Rackspace Technology, Inc. (RXT) generated $151.4M in operating cash flow during fiscal year 2025, representing cash generated from core business activities.

Rackspace Technology, Inc. (RXT) had $2.8B in total assets as of fiscal year 2025, including both current and long-term assets.

Rackspace Technology, Inc. (RXT) invested $60.8M in capital expenditures during fiscal year 2025, funding long-term assets and infrastructure.

Rackspace Technology, Inc. (RXT) invested $39.1M in research and development during fiscal year 2025.

Rackspace Technology, Inc. (RXT) had 247M shares outstanding as of fiscal year 2025.

Rackspace Technology, Inc. (RXT) had a current ratio of 0.68 as of fiscal year 2025, which is below 1.0, which may suggest potential liquidity concerns.

Rackspace Technology, Inc. (RXT) had a return on assets of -8.1% for fiscal year 2025, measuring how efficiently the company uses its assets to generate profit.

Rackspace Technology, Inc. (RXT) has no price-to-earnings ratio at the moment: net loss, so no earnings multiple (trailing 12 months to June 30, 2026). The market capitalization is $720.0M as of Oct 17, 2026; a multiple compares that price with a filed figure and says nothing about the quality of the business.

Rackspace Technology, Inc. (RXT) trades at 0.3x sales, its market capitalization divided by revenue of $2.7B revenue, trailing 12 months to June 30, 2026. The market capitalization is $720.0M as of Oct 17, 2026; a multiple compares that price with a filed figure and says nothing about the quality of the business.

Rackspace Technology, Inc. (RXT) has negative shareholder equity of -$1.2B as of fiscal year 2025, so no debt-to-equity ratio is reported: dividing debt by equity that is not positive produces a number that cannot be read as leverage. This can occur when accumulated losses exceed invested capital, or after large share buyback programs. Other solvency metrics like the current ratio or interest coverage may be more informative.

Rackspace Technology, Inc. (RXT) has an Altman Z-Score of -1.11, placing it in the Distress Zone (elevated bankruptcy risk). The Z-Score combines five financial ratios (working capital, retained earnings, EBIT, market capitalization, and revenue relative to total assets) to predict the likelihood of bankruptcy. Scores above 2.99 indicate financial safety while scores below 1.81 suggest financial distress. Learn more in our complete guide to financial health indicators.

Rackspace Technology, Inc. (RXT) has a Piotroski F-Score of 4 out of 9, indicating neutral financial health. The F-Score evaluates nine binary signals across profitability (positive ROA, positive cash flow, improving ROA, earnings quality), leverage (decreasing debt, improving liquidity, no share dilution), and operating efficiency (improving gross margin, improving asset turnover). Scores of 7 to 9 indicate strong and improving fundamentals. Learn more in our complete guide to financial health indicators.

Rackspace Technology, Inc. (RXT) reported a net loss of $225.8M while generating $151.4M in operating cash flow. Operations generated cash despite the loss, but with no positive earnings behind it, the ratio between the two carries no quality signal. This ratio compares operating cash flow to net income. A ratio above 1.0x means the company generates more cash than its reported earnings, indicating sustainable, cash-backed profits. Ratios below 1.0x suggest earnings rely on accounting accruals rather than actual cash generation. Learn more in our complete guide to financial health indicators.

Rackspace Technology, Inc. (RXT) reported an operating loss of $100.7M against $82.7M in interest expense. There is no operating profit to cover interest, so interest must be met from cash reserves or from financing rather than from operations. This ratio divides operating income by interest expense. Ratios above 5x indicate strong debt-servicing ability, while ratios below 2x suggest the company may face difficulty meeting interest payments if earnings decline. Learn more in our complete guide to financial health indicators.

Rackspace Technology, Inc. (RXT) scores 18 out of 100 on our Financial Health Score, indicating weak standing within its operating companies peer group. The score is a 0-100 composite of six dimensions (Profitability, Growth, Leverage, Liquidity, Cash Flow, Returns), each ranked as a percentile relative to companies in the same scoring family (banks against banks, REITs against REITs, and so on) rather than across all industries. It rates the quality of the business, not whether the stock is fairly priced, and is not financial advice. Learn more in our complete guide to financial health indicators.

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