Lost money in Rackspace Technology stock? You may be able to recover your losses.
Morgan-Reed v. Rackspace Technology, Inc., No. 1:26-cv-06491 (S.D.N.Y.)
A federal securities class action has been filed on behalf of Rackspace Technology (RXT) investors. Find out in about 30 seconds whether you may be eligible to participate, at no cost.
- No cost to participate
- No fee unless investors recover
- Talk to a real person, not a call center
- Lead plaintiff deadline
- September 28, 2026
- 4 days remaining
- Class period
- May 7, 2026 – Jul 8, 2026
- Eligible purchases fall between these dates
What happened to RXT
About this case
According to the complaint, Rackspace Technology and its executives misled investors about the company's full-year 2026 outlook during its shift toward AI infrastructure. The complaint alleges that between May 7 and July 8, 2026, the company reaffirmed its full-year revenue guidance and touted the strength of its Private Cloud and Public Cloud businesses, while allegedly failing to disclose that its AI pivot would divert capacity and capital away from its more profitable Private Cloud unit, that Public Cloud revenue was declining as customers contracted directly with hyperscalers, and that the company would materially shrink its Public Cloud resale business. On July 9, 2026, Rackspace cut its full-year 2026 revenue guidance by $150 million — citing an exit from low-margin resale operations and hyperscaler direct-contracting — and disclosed the news alongside a $250 million equity offering. On that news, the stock fell approximately 33.6% in a single day, to $4.37 per share.
The allegations, in plain terms
- May 7, 2026The class period begins. Per the complaint, Rackspace reaffirmed its full-year 2026 revenue guidance and touted the strength of its Private Cloud and Public Cloud businesses amid its shift toward AI infrastructure.
- May 7 – July 8, 2026The complaint alleges the company failed to disclose that its AI pivot would divert capacity and capital from its more profitable Private Cloud unit, that Public Cloud revenue was declining as customers contracted directly with hyperscalers, and that it would materially shrink its Public Cloud resale business.
- July 9, 2026Rackspace cut its full-year 2026 revenue guidance by $150 million, citing an exit from low-margin resale operations and hyperscaler direct-contracting, and announced a $250 million equity offering. On that news, the stock fell approximately 33.6% in one day, to $4.37 per share, per the complaint.
Summarizes allegations in the complaint — they are not findings of any court.
We screen hundreds of stock drops every year and file only a handful. If we're investigating this one, it's because we believe in it.
Block & Leviton is run by the partners whose names are on the door — and our clients deal with them directly, whatever the size of the loss. That's the point of staying small.
A dismissed case turned into a $150 million record.* A recovery from a company that went bankrupt. We build cases to go the distance — not to settle cheap.
* Subject to court approval. Prior results do not guarantee a similar outcome.
Who we are — and why we're involved
Block & Leviton represents investors. We never represent the companies we investigate. When a company's own disclosures reveal that shareholders were misled, we investigate and bring claims to recover those losses.
Our clients are people like you: individual investors, retirees, and pension funds harmed when the truth comes out and a stock falls. There is no cost to you to participate, and attorneys' fees are paid only out of a recovery approved by the court.
Who you'll be dealing with
Jeffrey Block
Represents investors in securities class actions nationwide.
Your first call will usually be with David White, our investor liaison — and our partners are directly involved in every case.
A record courts have trusted
NextEra Energy — $150 million
The district court dismissed the case. We appealed — and won a unanimous reversal in the Eleventh Circuit Court of Appeals. The result: a $150 million settlement — the largest securities class action settlement in the Southern District of Florida in more than 30 years.*
Dismissed — then revived when we persuaded the court to reconsider its own judgment. Settled in 2026.
Recovered for investors even after Tricida itself went bankrupt.
Federal courts have appointed Block & Leviton lead counsel in securities class actions on behalf of investors nationwide. Our attorneys have recovered billions of dollars for investors, retirees, and pension funds.
* Subject to court approval. Prior results do not guarantee a similar outcome. Attorney advertising.
Common questions
Will this cost me anything?
No. There is no cost to submit your information, no cost to participate, and no out-of-pocket cost ever. If there's a recovery, attorneys' fees are paid from it and must be approved by the court.
I'm already part of the class automatically — so why submit my information?
It's true: if you bought RXT during the class period, you're a class member whether or not you contact anyone. Submitting your information lets us evaluate your specific losses, keep you informed as the case develops, and tell you whether you may benefit from a larger role in the case.
What is a lead plaintiff?
The lead plaintiff is an investor the court appoints to represent the class, typically someone with a significant loss. Lead plaintiffs oversee the litigation on behalf of everyone and are entitled to seek reimbursement for their time. The deadline to seek appointment in this case is September 28, 2026.
I sold my shares after the drop — am I still eligible?
Possibly, yes. What generally matters is that you purchased shares during the class period and were harmed by the decline. Whether you still hold shares today doesn't necessarily disqualify you — submit your details and we'll evaluate your situation.
Does submitting this form make you my lawyers?
No — and that's a protection for you. Submitting the form only lets us evaluate your potential claim, at no cost. If we determine we can help and you decide to move forward, we'll send you a written retainer agreement that spells out the relationship, the contingency fee, and your rights. You're never committed to anything until you've read and signed it.
What happens after I submit the form?
Our team reviews your submission — usually within one business day. David, our investor liaison, will reach out by phone or email, and our partners are directly involved in every case. You're never obligated to do anything.
Attorney advertising. Prior results do not guarantee a similar outcome. Block & Leviton LLP is responsible for the content of this page. Submitting information through this page does not create an attorney-client relationship.