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Rackspace Expands Enterprise AI Stack with Palantir Tie-Up and Large Capacity Plan

Jul 9, 2026, 7:53 AM EDT2 sourcesAI-analyzed
Why it may matterVerify against the original reporting

Longer-term AI capacity ramp, strong Palantir collaboration, and sponsor backing create a multi-year growth path; near-term headwinds from FY26 downgrades and potential dilution may weigh on sentiment until 2H results confirm progress.

AI summary

What happened, with direct paths to the underlying reporting

Rackspace Technology will operate the full enterprise AI stack, leveraging key partnerships to scale AI capacity to 30MW by 2028. The company cut FY26 revenue by $150m and EBITDA by $20m due to supply constraints, but projects a 15MW capacity by 2027 and 30MW by 2028 with $15–$20m revenue per MW and 50%+ Adjusted EBITDA at scale. Palantir momentum, Apollo support, and an investor call on July 9 add near-term catalysts, while funding via a capital raise supports the expansion.

  • Rackspace will run the full enterprise AI stack; 15MW by 2027, 30MW by 2028.
  • Palantir Foundry/AIP deployment; Rackspace named preferred partner in regulated markets.
  • FY26 outlook lowered: revenue down by $150m, EBITDA down by $20m; AI ramp later.
  • 2027–2028 ramp monetizes at $15–$20m per MW; Adj EBITDA 50%+ at full 30MW.

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