Today’s capital raise announcement is meaningful because it will enable us to expedite our AI Enterprise strategy and unlock a meaningful revenue and EBITDA growth vector for Rackspace, starting in 2027,” said Gajen Kandiah, Chief Executive Officer of Rackspace Technology.
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The company also secured a definitive agreement with AMD to deploy 30 megawatts of GPU and CPU capacity through 2028, aiming directly at regulated healthcare and corporate AI workloads.
Apollo Global Management expressed continued alignment with the structural shift toward secure private cloud environments.
“Apollo remains highly supportive of Rackspace’s strategy and believes the Company is taking the right steps to fund its next phase of growth.
We are excited about the opportunity ahead and remain aligned with Rackspace as it builds a differentiated platform for Enterprise AI,” said Aaron Sobel, Partner at Apollo Global Management and a member of Rackspace Technology's Board of Directors.
Wall Street firms reacted to the multi-year transformation, with UBS raising its price target for the company to $5.50 following the AMD deal and the opening of a new regional headquarters in Riyadh.
Meanwhile, RBC Capital lifted its price target to $4 while maintaining a neutral sector perform rating.
The firm plans to expand its total enterprise AI capacity to 15 megawatts by the end of 2027, eventually reaching 30 megawatts by 2028.
According to official corporate projections, the company expects to average $15 million to $20 million in annual revenue per megawatt once these installations are operational.
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Rackspace Technology stock closed up 7.94 percent at $6.93 on Tuesday, July 7, 2026, ahead of the formal updated full-year forecast release.
