Rackspace Technology, Inc.

Previous wording

We operate our business and report our results through two reportable segments: Public Cloud and Private Cloud. Our Public Cloud segment is a services-centric, capital-light model providing value-added cloud solutions through managed services, Elastic Engineering and professional services offerings for customer environments hosted on the AWS, Microsoft Azure and Google Cloud public cloud platforms. Our Private Cloud segment is a technology-forward, capital-intensive model providing managed service offerings for customer environments hosted in one of our data centers as well as in those owned by customers or by third parties such as colocation providers. Private Cloud also includes our legacy OpenStack Public Cloud business that we ceased to actively market to customers in 2017. See Item 1 of Part I, Financial Statements - Note 13, "Segment Reporting," for additional information about our segments.

Current wording

We operate our business and report our results through two reportable segments: Public Cloud and Private Cloud. Our Public Cloud segment is a services-centric, capital-light model providing value-added cloud solutions through managed services, Elastic Engineering and professional services offerings for customer environments hosted on the AWS, Microsoft Azure and Google Cloud public cloud platforms. Our Private Cloud segment is a technology-forward, capital-intensive model providing managed service offerings for customer environments hosted in one of our data centers as well as in those owned by customers or by third parties such as colocation providers. See Item 1 of Part I, Financial Statements - Note 13, "Segment Reporting," for additional information about our segments.

Previous wording

A substantial amount of our revenue, particularly within our Private Cloud segment, is generated pursuant to contracts that typically have a fixed term (typically from 12 to 36 months). Our customers generally have the right to cancel their contracts by providing us with written notice prior to the end of the fixed term, though most of our contracts provide for termination fees in the event of cancellation prior to the end of their term, typically amounting to the outstanding value of the contract. These contracts include a monthly recurring fee, which is determined based on the computing resources utilized and provided to the customer, the complexity of the underlying infrastructure and the level of support we provide. Most of our services within our Public Cloud segment and legacy OpenStack business generate usage-based revenue invoiced on a monthly basis and can be canceled at any time without penalty. We also generate revenue from usage-based fees and fees from professional services earned from customers using our hosting and other services. We typically recognize revenue on a daily basis, as services are provided, in an amount that reflects the consideration to which we expect to be entitled in exchange for our services. Our usage-based arrangements generally include a variable consideration component, consisting of monthly utility fees, with a defined price and undefined quantity. Our customer contracts also typically contain service level guarantees, including with respect to network uptime requirements, that provide discounts when we fail to meet specific obligations and, with respect to certain products, we may offer volume discounts based on usage. As these variable consideration components consist of a single distinct daily service provided on a single performance obligation, we account for all of them as services are provided and earned.

Current wording

A substantial amount of our revenue, particularly within our Private Cloud segment, is generated pursuant to contracts that typically have a fixed term (typically from 12 to 36 months). Our customers generally have the right to cancel their contracts by providing us with written notice prior to the end of the fixed term, though most of our contracts provide for termination fees in the event of cancellation prior to the end of their term, typically amounting to the outstanding value of the contract. These contracts include a monthly recurring fee, which is determined based on the computing resources utilized and provided to the customer, the complexity of the underlying infrastructure and the level of support we provide. Most of our services within our Public Cloud segment generate usage-based revenue invoiced on a monthly basis and can be canceled at any time without penalty. We also generate revenue from usage-based fees and fees from professional services earned from customers using our hosting and other services. We typically recognize revenue on a daily basis, as services are provided, in an amount that reflects the consideration to which we expect to be entitled in exchange for our services. Our usage-based arrangements generally include a variable consideration component, consisting of monthly utility fees, with a defined price and undefined quantity. Our customer contracts also typically contain service level guarantees, including with respect to network uptime requirements, that provide discounts when we fail to meet specific obligations and, with respect to certain products, we may offer volume discounts based on usage. As these variable consideration components consist of a single distinct daily service provided on a single performance obligation, we account for all of them as services are provided and earned.

Previous wording

Our income tax benefit (provision) and deferred tax assets and liabilities reflect management's best assessment of estimated current and future taxes to be paid. To date, we have recorded consolidated tax benefits, reflecting our net losses, though certain of our non-U.S. subsidiaries have incurred corporate tax expense according to the relevant taxing jurisdictions. We are under certain domestic and foreign tax audits. Due to the complexity involved with certain tax matters, there is the possibility that the various taxing authorities may disagree with certain tax positions filed on our income tax returns. We believe we have made adequate provision for all uncertain tax positions. See Item 1 of Part I, Financial Statements - Note 10,"Taxes."

Current wording

Our income tax benefit (provision) and deferred tax assets and liabilities reflect management's best assessment of estimated current and future taxes to be paid. To date, we recorded consolidated tax expense, despite our net losses, due to the recording of valuation allowances against our deferred tax assets. Certain of our non-U.S. subsidiaries continue to incur corporate tax expense or benefit according to the relevant taxing jurisdictions. We are under certain domestic and foreign tax audits. Due to the complexity involved with certain tax matters, there is the possibility that the various taxing authorities may disagree with certain tax positions filed on our income tax returns. We believe we have made adequate provision for all uncertain tax positions. See Item 1 of Part I, Financial Statements - Note 10, "Taxes."

Previous wording

After removing the impact of foreign currency fluctuations, on a constant currency basis, revenue decreased 1.2% year-over-year. The following table presents revenue by segment:

Current wording

After removing the impact of foreign currency fluctuations, on a constant currency basis, revenue increased 1.0% year-over-year. The following table presents revenue by segment:

Previous wording

Public Cloud revenue in the three months ended September 30, 2025 increased 0.8% on an actual basis and 0.6% on a constant currency basis, from the three months ended September 30, 2024. The increase was driven by higher services revenue and increased infrastructure volumes.

Current wording

Public Cloud revenue in the three months ended March 31, 2026 increased 6.7% on an actual basis and 6.1% on a constant currency basis, from the three months ended March 31, 2025. The increase was driven by both higher services revenue and increased infrastructure volumes.

Previous wording

Private Cloud revenue in the three months ended September 30, 2025 decreased 3.1% on an actual basis and 4.0% on a constant currency basis, from the three months ended September 30, 2024, reflecting customer transitions off legacy platforms, partially offset by revenue from new bookings, including revenue related to certain customer contracts that include embedded sales-type lease arrangements for hardware.

Current wording

Private Cloud revenue in the three months ended March 31, 2026 decreased 6.0% on an actual basis and 7.5% on a constant currency basis, from the three months ended March 31, 2025, reflecting customer transitions off legacy platforms, partially offset by revenue from new bookings.

Previous wording

Cost of revenue increased $3 million, or 1%, to $541 million in the three months ended September 30, 2025 from $538 million in the three months ended September 30, 2024. The primary drivers of the increase include higher usage charges for third-party infrastructure, higher expense for hardware mainly related to certain customer contracts that include embedded sales-type lease arrangements, and depreciation expense. These increases were partially offset by a reduction in data center expense as a result of continued optimization initiatives and lower license expense, due to a reduction in usage between periods. Personnel costs decreased slightly between periods primarily driven by a reduction in non-equity incentive compensation.

Current wording

Cost of revenue increased $21 million, or 4%, to $559 million in the three months ended March 31, 2026 from $539 million in the three months ended March 31, 2025. The primary drivers of the increase include higher usage charges for third-party infrastructure, consistent with revenue growth, and higher depreciation expense. These increases were partially offset by lower license expense, due to a reduction in usage between periods, and a decrease in personnel costs driven by a reduction in non-equity incentive compensation and share-based compensation.

Previous wording

As a percentage of revenue, cost of revenue increased 100 basis points in the three months ended September 30, 2025 to 80.6% from 79.6% in the three months ended September 30, 2024 for the reasons discussed above.

Current wording

As a percentage of revenue, cost of revenue increased 150 basis points in the three months ended March 31, 2026 to 82.4% from 80.9% in the three months ended March 31, 2025 for the reasons discussed above.

Previous wording

Our gross profit was $130 million in the three months ended September 30, 2025, a decrease of $8 million from $138 million in the three months ended September 30, 2024. Our gross margin was 19.4% in the three months ended September 30, 2025, a decrease of 100 basis points from 20.4% in the three months ended September 30, 2024.

Current wording

Our gross profit was $119 million in the three months ended March 31, 2026, a decrease of $8 million from $127 million in the three months ended March 31, 2025. Our gross margin was 17.6% in the three months ended March 31, 2026, a decrease of 150 basis points from 19.1% in the three months ended March 31, 2025.

Previous wording

Selling, general and administrative expenses decreased $6 million, or 3%, to $164 million in the three months ended September 30, 2025 from $170 million in the three months ended September 30, 2024. Declining personnel costs had the largest impact due to a reduction in headcount between periods and a decrease in non-equity incentive compensation. Severance and share-based compensation expense, included in overall personnel costs, increased between periods largely driven by the departure of our former chief executive officer in the three months ended September 30, 2025. The prior period included additional insurance recovery proceeds related to the Hosted Exchange incident which resulted in an increase in expense year-over-year.

Current wording

Selling, general and administrative expenses decreased $28 million, or 17%, to $137 million in the three months ended March 31, 2026 from $165 million in the three months ended March 31, 2025. Declining personnel costs had the largest impact due to a reduction in headcount between periods and a decrease in severance and share-based compensation expense. Also driving the overall reduction in selling, general and administrative expenses was a gain on disposal of non-core assets in the current period and a decrease in amortization expense as certain customer relationship intangible assets reached the end of their useful lives between periods.

Previous wording

As a percentage of revenue, selling, general and administrative expenses decreased 70 basis points, to 24.4% in the three months ended September 30, 2025 from 25.1% in the three months ended September 30, 2024 primarily due to personnel costs, as discussed above.

Current wording

As a percentage of revenue, selling, general and administrative expenses decreased 460 basis points, to 20.2% in the three months ended March 31, 2026 from 24.8% in the three months ended March 31, 2025 primarily due to personnel costs, as discussed above.

Previous wording

Our loss from operations was $97 million in the nine months ended September 30, 2025 compared to $880 million in the nine months ended September 30, 2024. Our Non-GAAP Operating Profit was $85 million in the nine months ended September 30, 2025, an increase of $18 million from $67 million in the nine months ended September 30, 2024. Non-GAAP Operating Profit is a non-GAAP financial measure. See "Non-GAAP Financial Measures" below for more information.

Current wording

Our loss from operations was $18 million in the three months ended March 31, 2026 compared to $38 million in the three months ended March 31, 2025. Our Non-GAAP Operating Profit was $31 million in the three months ended March 31, 2026, an increase of $5 million from $26 million in the three months ended March 31, 2025. Non-GAAP Operating Profit is a non-GAAP financial measure. See "Non-GAAP Financial Measures" below for more information.

Previous wording

Public Cloud operating profit increased 38% in the nine months ended September 30, 2025 from the nine months ended September 30, 2024. Segment operating profit as a percentage of segment revenue increased by 110 basis points, reflecting a 2% decrease in segment operating expenses, partially offset by a 1% decrease in segment revenue. The decrease in expenses was mainly driven by operational improvements and cost optimization initiatives executed during 2024.

Current wording

Public Cloud operating profit increased 20% in the three months ended March 31, 2026 from the three months ended March 31, 2025. Segment operating profit as a percentage of segment revenue increased by 50 basis points, reflecting a 7% increase in segment revenue, partially offset by a 6% increase in segment operating expenses. The increase in expenses was mainly driven by higher cost of revenue, which increased inline with revenue growth between periods.

Previous wording

Private Cloud operating profit decreased 11% in the nine months ended September 30, 2025 from the nine months ended September 30, 2024. Segment operating profit as a percentage of segment revenue decreased by 190 basis points, due to a 5% decrease in segment revenue, partially offset by a 2% decrease in segment operating expenses. The decrease in expenses was mainly driven by cost optimization activities executed throughout 2024.

Current wording

Private Cloud operating profit decreased 5% in the three months ended March 31, 2026 from the three months ended March 31, 2025. Segment operating profit as a percentage of segment revenue increased by 30 basis points due to a 6% decrease in segment operating expenses, offset by a 6% decrease in segment revenue. The decrease in expenses was mainly driven by lower cost of revenue, inline with revenue decline, and gains on disposal of non-core assets in the current period.

Previous wording

Centralized corporate functions that provide services to the segments in areas such as accounting, information technology, marketing, legal and human resources are not allocated to the segments and are included in "corporate functions" in the table above. This expense decreased 14% in the three months ended September 30, 2025 from the three months ended September 30, 2024 due to our continued focus on cost management.

Current wording

Centralized corporate functions that provide services to the segments in areas such as accounting, information technology, marketing, legal and human resources are not allocated to the segments and are included in "corporate functions" in the table above. This expense decreased 9% in the three months ended March 31, 2026 from the three months ended March 31, 2025 due to our continued focus on cost management.

Previous wording

We recorded an$18 million gain on debt extinguishment in the three months ended September 30, 2024 related to repurchases of $24 million principal amount of the FLSO Term Loan Facility.

Current wording

We recorded 56 million total gain on debt extinguishment in the three months ended March 31, 2026 related to repurchases of an aggregate$96 million principal amount of the 3.50% FLSO Senior Secured Notes, 3.50% Senior Secured Notes, and 5.375% Senior Notes.

Previous wording

The increase in other expense, net to $4 million inthe three months ended September 30, 2025 from$1 million inthe three months ended September 30, 2024 is primarily due to foreign currency transaction losses.

Current wording

The decrease in other expense, net to $4 million in the three months ended March 31, 2026 from $5 million in the three months ended March 31, 2025 is primarily due to foreign currency transaction gains.

Previous wording

Our income tax expense was $8 million in the three months ended September 30, 2025 compared to $12 million in the three months ended September 30, 2024. Our effective tax rate decreased to (13.6)% in the three months ended September 30, 2025 from (6.8)% in the three months ended September 30, 2024. The decrease in the effective tax rate year-over-year is primarily due to the tax impact associated with changes in valuation allowance, the net impact of the geographic distribution of our earnings, thetax impact associated with the goodwill impairment recorded in September 2024, the majority of which was nondeductible for income tax purposes, executive compensation that is non-deductible under Internal Revenue Code (“IRC”) Section 162(m), and the tax impact of the March 2024 Refinancing Transactions. The difference between the effective tax rate and the statutory rate for the three months ended September 30, 2025 is primarily due to the tax impact associated with changes in valuation allowance, executive compensation that is non-deductible under IRC Section 162(m), and the net impact of the geographic distribution of our earnings.

Current wording

Our income tax benefit was $0.1 million in the three months ended March 31, 2026 compared to $8 million income tax expense in the three months ended March 31, 2025. Our effective tax rate increased to (1.5)% in the three months ended March 31, 2026 from (12.9)% in the three months ended March 31, 2025. The increase in the effective tax rate year-over-year is primarily due to the tax impact associated with changes in valuation allowance, the net impact of the geographic distribution of our earnings, the tax effects from non-deductible share-based compensation, and executive compensation that is non-deductible under Internal Revenue Code (“IRC”) Section 162(m). The difference between the effective tax rate and the statutory rate for the three months ended March 31, 2026 is primarily due to the tax impact associated with changes in valuation allowance, executive compensation that is non-deductible under IRC Section 162(m), and the net impact of the geographic distribution of our earnings.

Previous wording

The following tables present, by segment, actual and constant currency revenue and constant currency revenue growth rates, for and between the periods indicated:

Current wording

The following table presents, by segment, actual and constant currency revenue and constant currency revenue growth rates, for and between the periods indicated:

Previous wording

We define Non-GAAP Net Income (Loss) as net income (loss) adjusted to exclude the impact of non-cash charges for share-based compensation, transaction-related costs and adjustments, restructuring and transformation charges, costs related to the Hosted Exchange incident, the amortization of acquired intangible assets, goodwill and asset impairment charges, the interest expense impact from the March 2024 Refinancing Transactions, and certain other non-operating, non-recurring or non-core gains and losses, as well as the tax effects of these non-GAAP adjustments.

Current wording

We define Non-GAAP Net Income (Loss) as net income (loss) adjusted to exclude the impact of non-cash charges for share-based compensation, transaction-related costs and adjustments, restructuring and transformation charges, the amortization of acquired intangible assets, goodwill and asset impairment charges, the interest expense impact from the refinancing transactions announced in March 2024(the “March 2024 Refinancing Transactions”), and certain other non-operating, non-recurring or non-core gains and losses, as well as the tax effects of these non-GAAP adjustments.

Previous wording

We define Non-GAAP Operating Profit as income (loss) from operations adjusted to exclude the impact of non-cash charges for share-based compensation, transaction-related costs and adjustments, restructuring and transformation charges, costs related to the Hosted Exchange incident, the amortization of acquired intangible assets, goodwill and asset impairment charges, and certain other non-operating, non-recurring or non-core gains and losses.

Current wording

We define Non-GAAP Operating Profit as income (loss) from operations adjusted to exclude the impact of non-cash charges for share-based compensation, transaction-related costs and adjustments, restructuring and transformation charges, the amortization of acquired intangible assets, goodwill and asset impairment charges, and certain other non-operating, non-recurring or non-core gains and losses.

Previous wording

We define Adjusted EBITDA as net income (loss) adjusted to exclude the impact of non-cash charges for share-based compensation, transaction-related costs and adjustments, restructuring and transformation charges, costs related to the Hosted Exchange incident, certain other non-operating, non-recurring or non-core gains and losses, interest expense, expenses for our accounts receivable purchase agreement, income taxes, depreciation and amortization, and goodwill and asset impairment charges.

Current wording

We define Adjusted EBITDA as net income (loss) adjusted to exclude the impact of non-cash charges for share-based compensation, transaction-related costs and adjustments, restructuring and transformation charges, certain other non-operating, non-recurring or non-core gains and losses, interest expense, expenses for our accounts receivable purchase agreement, income taxes, depreciation and amortization, and goodwill and asset impairment charges.

Previous wording

Net loss reconciliation to Non-GAAP Net Loss

Current wording

Net income (loss) reconciliation to Non-GAAP Net Loss

Previous wording

Net loss reconciliation to Adjusted EBITDA

Current wording

Net income (loss) reconciliation to Adjusted EBITDA

Previous wording

We define Non-GAAP Earnings (Loss) Per Share as Non-GAAP Net Income (Loss) divided by our GAAP weighted average number of shares outstanding for the period on a diluted basis and further adjusted for the weighted average number of shares associated with securities which are anti-dilutive to GAAP loss per share. Management uses Non-GAAP Earnings (Loss) Per Share to evaluate the performance of our business on a comparable basis from period to period, including by adjusting for the impact of the issuance of shares. The following table reconciles Non-GAAP Loss Per Share to our GAAP net loss per share on a diluted basis:

Current wording

We define Non-GAAP Earnings (Loss) Per Share as Non-GAAP Net Income (Loss) divided by our GAAP weighted average number of shares outstanding for the period on a diluted basis and further adjusted for the weighted average number of shares associated with securities which are anti-dilutive to GAAP loss per share. Management uses Non-GAAP Earnings (Loss) Per Share to evaluate the performance of our business on a comparable basis from period to period, including by adjusting for the impact of the issuance of shares. The following table reconciles Non-GAAP Loss Per Share to our GAAP net earnings (loss) per share on a diluted basis:

Previous wording

We primarily finance our operations and capital expenditures with internally-generated cash from operations and hardware leases, and if necessary, borrowings under the New Revolving Credit Facility. As of September 30, 2025, the New Revolving Credit Facility provided for up to $375 million of borrowings, $65 million of which was drawn and outstanding as of September 30, 2025. Our primary uses of cash are working capital requirements, debt service requirements and capital expenditures. Based on our current level of operations and available cash, we believe our sources will provide sufficient liquidity over at least the next twelve months. We cannot provide assurance, however, that our business will generate sufficient cash flows from operations or that future borrowings will be available to us under the New Revolving Credit Facility or from other sources in an amount sufficient to enable us to pay our indebtedness or to fund our other liquidity needs. Our ability to do so depends on prevailing economic conditions and other factors, many of which are beyond our control. In addition, upon the occurrence of certain events, such as a change of control, we could be required to repay or refinance our indebtedness. We cannot assure that we will be able to refinance any of our indebtedness on commercially reasonable terms or at all. Any future acquisitions, joint ventures or other similar transactions will likely require additional capital, and there can be no assurance that any such capital will be available to us on acceptable terms or at all.

Current wording

We primarily finance our operations and capital expenditures with internally-generated cash from operations and hardware leases, and if necessary, borrowings under the Revolving Credit Facility. As of March 31, 2026, the Revolving Credit Facility provided for up to $375 million of borrowings, $150 million of which was drawn and outstanding as of March 31, 2026. Our primary uses of cash are working capital requirements, debt service requirements and capital expenditures. Based on our current level of operations and available cash, we believe our sources will provide sufficient liquidity over at least the next twelve months. We cannot provide assurance, however, that our business will generate sufficient cash flows from operations or that future borrowings will be available to us under the Revolving Credit Facility or from other sources in an amount sufficient to enable us to pay our indebtedness or to fund our other liquidity needs. Our ability to do so depends on prevailing economic conditions and other factors, many of which are beyond our control. In addition, upon the occurrence of certain events, such as a change of control, we could be required to repay or refinance our indebtedness. We cannot assure that we will be able to refinance any of our indebtedness on commercially reasonable terms or at all. Any future acquisitions, joint ventures or other similar transactions will likely require additional capital, and there can be no assurance that any such capital will be available to us on acceptable terms or at all.

Previous wording

At September 30, 2025, we held $100 million in cash and cash equivalents (not including $2 million in restricted cash, which is included in "Other non-current assets"), of which $81 million was held by foreign entities.

Current wording

At March 31, 2026, we held $94 million in cash and cash equivalents (not including $2 million in restricted cash, which is included in "Other non-current assets"), of which $77 million was held by foreign entities.

Previous wording

We have entered into installment payment arrangements with certain equipment and software vendors, along with sale-leaseback arrangements for equipment and certain property leases that are considered financing obligations. We had $42 million outstanding with respect to these arrangements as of September 30, 2025. We may choose to utilize these various sources of funding in future periods.

Current wording

We have entered into installment payment arrangements with certain equipment and software vendors, along with sale-leaseback arrangements for equipment and certain property leases that are considered financing obligations. We had $49 million outstanding with respect to these arrangements as of March 31, 2026. We may choose to utilize these various sources of funding in future periods.

Previous wording

We also lease certain equipment and real estate under operating and finance lease agreements. We had $462 million outstanding with respect to operating and finance lease agreements as of September 30, 2025. We may choose to utilize such leasing arrangements in future periods.

Current wording

We also lease certain equipment and real estate under operating and finance lease agreements. We had $470 million outstanding with respect to operating and finance lease agreements as of March 31, 2026. We may choose to utilize such leasing arrangements in future periods.

Previous wording

As of September 30, 2025, we had $2,434 million aggregate principal amount outstanding under the FLSO Term Loan Facility, the FLFO Term Loan Facility, the Term Loan Facility, 3.50% FLSO Senior Secured Notes,5.375% Senior Notes, and 3.50% Senior Secured Notes. The New Revolving Credit Facility provides for up to $375 million of borrowings, $65 million of which was drawn and outstanding as of September 30, 2025. Our liquidity requirements are significant, primarily due to debt service requirements.

Current wording

As of March 31, 2026, we had $2,328 million aggregate principal amount outstanding under the FLSO Term Loan Facility, the FLFO Term Loan Facility, the Term Loan Facility, 3.50% FLSO Senior Secured Notes,5.375% Senior Notes, and 3.50% Senior Secured Notes. The Revolving Credit Facility provides for up to $375 million of borrowings, $150 million of which was drawn and outstanding as of March 31, 2026. Our liquidity requirements are significant, primarily due to debt service requirements.

Previous wording

On March 12, 2024, Rackspace Finance Holdings, LLC ( “Rackspace Finance Holdings”), Rackspace Finance, LLC ( “Rackspace Finance”), the lenders and issuing banks party thereto and Citibank, N.A., as the administrative agent and collateral agent, entered into the credit agreement governing the FLSO Term Loan Facility, FLFO Term Loan Facility and New Revolving Credit Facility (together, the “New Senior Facilities”) (the “New First Lien Credit Agreement”).

Current wording

On March 12, 2024, Rackspace Finance Holdings, LLC (“Rackspace Finance Holdings”), Rackspace Finance, LLC (“Rackspace Finance”), the lenders and issuing banks party thereto and Citibank, N.A., as the administrative agent and collateral agent, entered into the credit agreement governing the FLSO Term Loan Facility, FLFO Term Loan Facility and Revolving Credit Facility (together, the “Senior Facilities”) (the “First Lien Credit Agreement”).

Previous wording

As of September 30, 2025, the contractual interest rate on the FLSO Term Loan Facility was 7.04%. We are required to make quarterly principal payments of $4 million.

Current wording

As of March 31, 2026, the contractual interest rate on the FLSO Term Loan Facility was 6.54%. We are required to make quarterly principal payments of $4 million.

Previous wording

As of September 30, 2025, $1,614 million in aggregate principal amount of the FLSO Term Loan Facility remained outstanding.

Current wording

As of March 31, 2026, $1,606 million in aggregate principal amount of the FLSO Term Loan Facility remained outstanding.

Previous wording

As of September 30, 2025, the contractual interest rate on the FLFO Term Loan Facility was 10.54%. We are required to make quarterly principal payments of $0.7 million.

Current wording

As of March 31, 2026, the contractual interest rate on the FLFO Term Loan Facility was 10.04%. We are required to make quarterly principal payments of $0.7 million.

Previous wording

Rackspace Finance established the New Revolving Credit Facility in an aggregate principal amount of $375 million of commitments. All revolving lenders under the prior Revolving Credit Facility exchanged their revolving loan commitments for commitments in respect of the New Revolving Credit Facility, which replaced in full the prior Revolving Credit Facility. The New Revolving Credit Facility matures on May 15, 2028.

Current wording

Rackspace Finance established the Revolving Credit Facility in an aggregate principal amount of $375 million of commitments. The Revolving Credit Facility matures on May 15, 2028.

Previous wording

The New Revolving Credit Facility includes a commitment fee equal to 0.50% per annum in respect of the unused commitments that is due quarterly. This fee is subject to one step-down based on the net first lien leverage ratio.

Current wording

The Revolving Credit Facility includes a commitment fee equal to 0.50% per annum in respect of the unused commitments that is due quarterly. This fee is subject to one step-down based on the net first lien leverage ratio.

Previous wording

As of September 30, 2025, we had total commitments of $375 million, $65 million of outstanding borrowings under the New Revolving Credit Facility, and $24 million of letters of credit issued thereunder. As such, as of September 30, 2025, we had $286 million of available commitments remaining.

Current wording

As of March 31, 2026, we had total commitments of $375 million, $150 million of outstanding borrowings under the Revolving Credit Facility, and $24 million of letters of credit issued thereunder. As such, as of March 31, 2026, we had $202 million of available commitments remaining.

Previous wording

On March 12, 2024, Rackspace Finance issued $267 million initial aggregate principal amount of 3.50% FLSO Senior Secured Notes. The 3.50% FLSO Senior Secured Notes will mature on May 15, 2028 and bear interest at an annual fixed rate of 3.50%. Interest is payable semiannually on February 15 and August 15.

Current wording

On March 12, 2024, Rackspace Finance issued $267 million initial aggregate principal amount of 3.50% FLSO Senior Secured Notes. On April 2, 2024 and April 16, 2024, Rackspace Finance issued additional 3.50% FLSO Senior Secured Notes in an aggregate principal amount of $93 million and $4 million, respectively The 3.50% FLSO Senior Secured Notes will mature on May 15, 2028 and bear interest at an annual fixed rate of 3.50%. Interest is payable semiannually on February 15 and August 15.

Previous wording

As of September 30, 2025, $319 million aggregate principal amount of the 3.50% FLSO Senior Secured Notes were outstanding.

Current wording

As of March 31, 2026, $250 million aggregate principal amount of the 3.50% FLSO Senior Secured Notes were outstanding.

Previous wording

On February 9, 2021, we amended and restated the credit agreement governing our senior secured credit facilities (the "First Lien Credit Agreement"), which included a new seven-year $2,300 million senior secured first lien term loan facility (the "Term Loan Facility") and the prior Revolving Credit Facility (together, the "Senior Facilities"). The Term Loan Facility will mature on February 15, 2028 and the prior Revolving Credit Facility was set to mature on August 7, 2025.

Current wording

On February 9, 2021, we amended and restated the credit agreement governing the $2,300 million senior secured first lien term loan facility (the "Term Loan Facility"). The Term Loan Facility matures on February 15, 2028.