Rackspace Technology, Inc. (NASDAQ:RXT) Q1 2024 Earnings Call Transcript

The macro environment still remains challenging, uncertain, so to speak. And a lot of projects are more focused on cost optimization, but we are starting to see a lot of projects emerge on the AI side. And on Private Cloud, our vertical strategy is working very well on the Private Cloud side. So looking forward into the second half, Mark, do you want to talk about what the — what we are seeing from an outlook perspective?

Mark Marino: Yes, sure. Yes. Thanks, Amar. Yes. Just from a high level in terms of second half of the year, we do see revenue stabilizing sequentially in Q3 and a slight uptick in sequential revenue going into Q4 across both business units. And from an operating profit perspective, we see overall second half operating profit significantly higher than the first half as we continue to see the pull-through on the revenue, higher revenue as well as driving efficiencies throughout the organization.

Amar Maletira: And on efficiencies, we continue to drive a lot of efficiencies throughout the organization, Ramsey from the actions actually we took earlier on in the second half of 2023 as well as the actions we continue to take in 2024. And these are efficiencies across both labor as well as non-labor. And so that’s why we are — that’s why we believe the second half — we are estimating the second half operating profit should be significantly higher than the first half.

Ramsey El-Assal: Got it. Thank you.

Operator: Thank you. Now this concludes today’s Q&A session. I will now turn the call back over to Sagar Hebbar with closing remarks.

Sagar Hebbar: Thank you, everyone, for joining us. If we did not get to your question or if you have a follow-up please e-mail us at ir@rackspace.com. Have a great evening everyone.

Operator: This concludes today’s conference call. Thank you for your participation. You may now disconnect. Everyone have a wonderful day.