Rackspace Technology, Inc. reported a net loss of $858.2 million for the fiscal year ended December 31, 2024, compared to a net loss of $837.8 million in 2023. Revenue decreased by $220 million (7.4%) to $2,737.1 million in 2024. This decrease stemmed from declines in both the Public Cloud and Private Cloud segments, with Public Cloud revenue falling by 3.4% and Private Cloud revenue dropping by 13.2%. The company attributed the Private Cloud decline to customers transitioning away from legacy offerings.
Cost of revenue decreased by $125 million (5.4%) to $2,203.7 million in 2024, primarily due to increased useful life of certain assets, resulting in lower depreciation expense, and reduced headcount. However, cost of revenue as a percentage of revenue increased to 80.5% from 78.7% in 2023, reflecting the disproportionate impact of the revenue decline. Selling, general, and administrative (SG&A) expenses decreased by $60 million (7.8%) to $707.6 million, primarily due to lower personnel costs and insurance recovery proceeds.
Significant non-cash charges impacted the company's financial performance. Goodwill impairment charges totaled $714.9 million in 2024, compared to $708.8 million in 2023. These impairments were attributed to updated internal forecasts reflecting factors such as budgeted-to-actual performance, macroeconomic conditions, and industry changes. Net asset impairment charges were $20 million in 2024, down from $52.2 million in 2023. Interest expense decreased significantly to $98 million in 2024 from $221.6 million in 2023, largely due to the accounting treatment of the March 2024 Refinancing Transactions.
As of December 31, 2024, Rackspace Technology served over 81,000 customers across 120 countries. The company employed approximately 5,100 people across 23 countries, with approximately 70% working remotely. The company's outlook and forward-looking statements indicate a continued focus on strategic initiatives, including growth in private cloud solutions, development of innovative offerings, and expansion of sales efforts. The company acknowledged significant risks related to competition, indebtedness, cybersecurity, and the execution of its strategies. The company does not anticipate paying dividends in the foreseeable future.
About Rackspace Technology, Inc.
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