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Amar Maletira, the Chief Executive Officer of Rackspace Technology, Inc. (NASDAQ:RXT), recently sold a significant portion of his holdings in the company. The transaction comes at a time when InvestingPro data shows the stock has declined over 22% in the past six months, with current market capitalization standing at approximately $425 million. According to a filing with the Securities and Exchange Commission, Maletira sold 521,840 shares of Rackspace common stock, amounting to a total value of $975,840. The transactions were executed at prices ranging from $1.75 to $2.13 per share, with a weighted average sale price of $1.87. This price represents a 45% decline from the stock’s 52-week high of $3.41.
These sales were part of a "sell to cover" transaction, designed specifically to satisfy tax withholding obligations related to the vesting of restricted stock units previously granted to Maletira. The transactions were conducted under a Rule 10b5-1 trading plan, which Maletira adopted in September 2023. This plan allows for the automatic sale of shares to meet tax obligations.
Following this transaction, Maletira retains ownership of 4,368,328 shares of Rackspace Technology.
In other recent news, Rackspace Technology, Inc. reported fourth-quarter results that exceeded analyst expectations, though the company’s performance and outlook did not impress investors. The company posted an adjusted earnings per share of -$0.02, surpassing the anticipated -$0.04, and revenue of $685.6 million, beating the consensus forecast of $674.98 million. Despite this, revenue represented a 5% decline year-over-year from $720 million in the same quarter last year. Rackspace’s private cloud revenue fell 6% year-over-year to $269 million, while public cloud revenue decreased 4% to $417 million. For the full year 2024, total revenue dropped 7% to $2.74 billion. The company provided first-quarter 2025 guidance with revenue expected between $653 million and $665 million, aligning with the consensus estimate of $659.6 million. Adjusted earnings per share are projected to be between -$0.07 and -$0.09, matching the analyst estimate of -$0.08. Despite these figures, the continued revenue declines in Rackspace’s business segments seemed to concern investors. As of December 31, 2024, Rackspace reported cash and cash equivalents of $144 million with no outstanding balance on its $375 million revolving credit facility.
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