Rackspace Technology, Inc.

Previous wording

Our success greatly depends on our ability to retain and develop opportunities with our existing customers and to attract new customers. We operate in a growing but competitive and evolving market environment, requiring innovation to differentiate us from our competitors. Enterprise AI offerings in the market today typically put the full operational burden on the customer, which is especially difficult in regulated industries where governance, data sovereignty and operational continuity are critical. We believe Rackspace is uniquely positioned to deliver the full governed enterprise AI stack from silicon through business outcomes under a single accountable operator, serving a demand now visible across the market. Enterprises, particularly in regulated industries, are seeking control over their compute, their models, and their data, and assurance that the proprietary knowledge embedded in that data is not transferred outside their environments. We are model-agnostic by design and operate the governed layer that allows enterprises to use the best available models, whether open, closed, or their own, on private cloud where control matters and public cloud where elasticity matters, while policy, identity, and data boundaries remain under the enterprise’s control.

Current wording

Our success greatly depends on our ability to retain and develop opportunities with our existing customers and to attract new customers. We operate in a growing but competitive and evolving market environment, requiring innovation to differentiate us from our competitors. Enterprise AI offerings in the market today typically put the full operational burden on the customer, which is especially difficult in regulated industries where governance, data sovereignty and operational continuity are critical. We believe Rackspace is uniquely positioned to deliver the full governed enterprise AI stack from silicon through business outcomes under a single accountable operator, serving a demand visible across the market. Enterprises, particularly in regulated industries, are seeking control over their compute, their models, and their data, and assurance that the proprietary knowledge embedded in that data is not transferred outside their environments. We are model-agnostic by design and operate the governed layer that allows enterprises to use the best available models, whether open, closed, or their own, on private cloud where control matters and public cloud where elasticity matters, while policy, identity, and data boundaries remain under the enterprise’s control.

Previous wording

After removing the impact of foreign currency fluctuations, on a constant currency basis, revenue increased 0.4% 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 decreased 9.2% year-over-year. The following table presents revenue by segment:

Previous wording

Private Cloud revenue in the three months ended June 30, 2026 increased 5.5% on an actual basis and 5.2% on a constant currency basis, from the three months ended June 30, 2025, largely due to 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 September 30, 2026 increased 4.2% on an actual and constant currency basis, from the three months ended September 30, 2025, largely due to revenue related to certain customer contracts that include embedded sales-type lease arrangements for hardware.

Previous wording

As a percentage of revenue, cost of revenue increased 230 basis points in the three months ended June 30, 2026 to 82.9% from 80.6% in the three months ended June 30, 2025 for the reasons discussed above.

Current wording

As a percentage of revenue, cost of revenue increased 80 basis points in the three months ended September 30, 2026 to 81.4% from 80.6% in the three months ended September 30, 2025 as the revenue decline slightly outpaced the expense reduction.

Previous wording

Our gross profit was $115 million in the three months ended June 30, 2026, a decrease of $14 million from $129 million in the three months ended June 30, 2025. Our gross margin was 17.1% in the three months ended June 30, 2026, a decrease of 230 basis points from 19.4% in the three months ended June 30, 2025.

Current wording

Our gross profit was $113 million in the three months ended September 30, 2026, a decrease of $17 million from $130 million in the three months ended September 30, 2025. Our gross margin was 18.6% in the three months ended September 30, 2026, a decrease of 80 basis points from 19.4% in the three months ended September 30, 2025.

Previous wording

Selling, general and administrative expenses decreased $6 million, or 4%, to $148 million in the three months ended June 30, 2026 from $154 million in the three months ended June 30, 2025. Amortization expense had the largest impact on the overall reduction in selling, general and administrative expense as certain customer relationship intangible assets reached the end of their useful lives between periods. Personnel costs also contributed to the decline in expense due to a reduction in headcount between periods and a decrease in non-equity incentive compensation, partially offset by an increase in severance expense driven by the workforce realignment plan announced in June 2026. An increase in professional fees between periods partially offset these expense reductions.

Current wording

Selling, general and administrative expenses decreased $38 million, or 23%, to $126 million in the three months ended September 30, 2026 from $164 million in the three months ended September 30, 2025. Personnel costs had the largest impact on the overall reduction in selling, general and administrative expense due to a decline in headcount between periods, driven by the workforce realignment plan announced in June 2026, and a reduction in share-based compensation and non-equity incentive compensation. Amortization expense also decreased as certain customer relationship intangible assets reached the end of their useful lives between periods. An increase in professional fees between periods partially offset these expense reductions.

Previous wording

As a percentage of revenue, selling, general and administrative expenses decreased 110 basis points, to 22.1% in the three months ended June 30, 2026 from 23.2% in the three months ended June 30, 2025 primarily due to amortization expense, as discussed above.

Current wording

As a percentage of revenue, selling, general and administrative expenses decreased 380 basis points, to 20.6% in the three months ended September 30, 2026 from 24.4% in the three months ended September 30, 2025 primarily due to the decline in personnel costs, as discussed above.

Previous wording

Our loss from operations was $33 million in the three months ended June 30, 2026 compared to $25 million in the three months ended June 30, 2025. Our Non-GAAP Operating Profit was $27 million in both the three months ended June 30, 2026 and June 30, 2025. 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 $13 million in the three months ended September 30, 2026 compared to $34 million in the three months ended September 30, 2025. Our Non-GAAP Operating Profit was $36 million in the three months ended September 30, 2026, an increase of $4 million from $32 million in the three months ended September 30, 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 17% in the three months ended June 30, 2026 from the three months ended June 30, 2025. Segment operating profit as a percentage of segment revenue increased by 80 basis points, reflecting a 3% decrease in segment operating expenses, partially offset by a 2% decrease in segment revenue. The decrease in expenses was mainly driven by lower cost of revenue, in-line with revenue decline between periods.

Current wording

Public Cloud operating profit increased 94% in the three months ended September 30, 2026 from the three months ended September 30, 2025. Segment operating profit as a percentage of segment revenue increased by 450 basis points, reflecting a 21% decrease in segment operating expenses, partially offset by a 17% decrease in segment revenue. The decrease in expenses was mainly driven by lower cost of revenue, in-line with revenue decline between periods, and reduced selling, general and administrative expenses reflecting ongoing cost management initiatives.

Previous wording

Private Cloud operating profit decreased 7% in the three months ended June 30, 2026 from the three months ended June 30, 2025. Segment operating profit as a percentage of segment revenue decreased by 280 basis points due to a 9% increase in segment operating expenses, partially offset by a 5% increase in segment revenue. The increase in expenses was mainly due to higher cost of revenue, including higher expense for hardware mainly related to certain customer contracts that include embedded sales-type lease arrangements, customer license and data center costs, driven by margin compression between periods.

Current wording

Private Cloud operating profit decreased 21% in the three months ended September 30, 2026 from the three months ended September 30, 2025. Segment operating profit as a percentage of segment revenue decreased by 640 basis points due to a 13% increase in segment operating expenses, partially offset by a 4% increase in segment revenue. The increase in expenses was mainly due to higher cost of revenue, including higher expense for hardware mainly related to certain customer contracts that include embedded sales-type lease arrangements and customer license costs, driven by margin compression between periods.

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 3% in the three months ended June 30, 2026 from the three months ended June 30, 2025 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 September 30, 2026 from the three months ended September 30, 2025 due to our continued focus on cost management.

Previous wording

Interest expense increased $13 million, or 61%, to $34 million in the three months ended June 30, 2026 from $21 million in the three months ended June 30, 2025 driven by the impact of our interest rate swap maturing in February 2026. Borrowings on the Revolving Credit Facility also contributed to the increase in interest expense between periods.

Current wording

Interest expense increased $14 million, or 67%, to $36 million in the three months ended September 30, 2026 from $21 million in the three months ended September 30, 2025 driven by the impact of our interest rate swap maturing in February 2026. Borrowings on the Revolving Credit Facility also contributed to the increase in interest expense between periods. These increases in interest expense were partially offset by repurchases of senior notes between periods.

Previous wording

The increase in other expense, net to $5 million in the three months ended June 30, 2026 from $4 million in the three months ended June 30, 2025 is primarily due to foreign currency transaction losses.

Current wording

The decrease in other expense, net to $2 million in the three months ended September 30, 2026 from $4 million in the three months ended September 30, 2025 is primarily due to foreign currency transaction gains and the increase in the fair value of our convertible promissory note, as discussed in Item 1 of Part I, Financial Statements - Note 2, "Customer Contracts."

Previous wording

Our income tax expense was $2 million in the three months ended June 30, 2026 compared to $5 million in the three months ended June 30, 2025. Our effective tax rate increased to (2.8)% in the three months ended June 30, 2026 from (9.3)% in the three months ended June 30, 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, and the tax effects from non-deductible share-based compensation. The difference between the effective tax rate and the statutory rate for the three months ended June 30, 2026 is primarily due to the tax impact associated with changes in valuation allowance, executive compensation that is non-deductible under Internal Revenue Code ("IRC") Section 162(m), and the net impact of the geographic distribution of our earnings.

Current wording

Our income tax expense was $4 million in the three months ended September 30, 2026 compared to $8 million in the three months ended September 30, 2025. Our effective tax rate increased to (7.7)% in the three months ended September 30, 2026 from (13.6)% in the three months ended September 30, 2025. The increase in the effective tax rate year-over-year is primarily due to the tax impact associated with changes in valuation allowance, executive compensation that is nondeductible under Internal Revenue Code ("IRC") Section 162(m), non-deductible share-based compensation, and the net impact of the geographic distribution of our earnings. The difference between the effective tax rate and the statutory rate for the three months ended September 30, 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

After removing the impact from foreign currency fluctuations, on a constant currency basis, revenue increased 0.7% year-over-year. The following table presents revenue by segment:

Current wording

After removing the impact from foreign currency fluctuations, on a constant currency basis, revenue decreased 2.6% year-over-year. The following table presents revenue by segment:

Previous wording

Public Cloud revenue in the three months ended June 30, 2026 decreased 2.3% on an actual basis and 2.5% on a constant currency basis, from the three months ended June 30, 2025. The decline was driven by lower services revenue.

Current wording

Public Cloud revenue in the nine months ended September 30, 2026 decreased 4.3% on an actual basis and 4.6% on a constant currency basis, from the nine months ended September 30, 2025. The revenue decline was driven by lower services revenue.

Previous wording

Private Cloud revenue in the six months ended June 30, 2026 decreased 0.3% on an actual basis and 1.2% on a constant currency basis, from the six months ended June 30, 2025, 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 nine months ended September 30, 2026 increased 1.2% on an actual basis and 0.6% on a constant currency basis, from the nine months ended September 30, 2025, largely due to revenue related to certain customer contracts that include embedded sales-type lease arrangements for hardware.

Previous wording

Cost of revenue increased $39 million, or 4%, to $1,114 million in the six months ended June 30, 2026 from $1,076 million in the six months ended June 30, 2025. The primary drivers of the increase include higher usage charges for third-party infrastructure and higher depreciation expense. In addition, we had higher expense for hardware mainly related to certain customer contracts that include embedded sales-type lease arrangements. These increases were partially offset by lower license expense, due to a reduction in usage between periods, and a decrease in personnel costs. The decrease in personnel costs was largely due to a decline in headcount between periods and a reduction in non-equity incentive compensation, partially offset by an increase in severance expense driven by the workforce realignment plan announced in June 2026.

Current wording

Cost of revenue decreased $7 million, or 0.4%, to $1,610 million in the nine months ended September 30, 2026 from $1,617 million in the nine months ended September 30, 2025. Personnel costs was the largest driver of the decrease due to a decline in headcount between periods and a reduction in non-equity incentive compensation, partially offset by an increase in severance expense driven by the workforce realignment plan announced in June 2026. Also contributing to the decrease was a reduction in usage charges for third-party infrastructure, consistent with the decline in Public Cloud revenue, and lower license expense, due to a reduction in usage between periods. Partially offsetting these decreases in cost of revenue was higher depreciation expense and higher expense for hardware mainly related to certain customer contracts that include embedded sales-type lease arrangements.

Previous wording

As a percentage of revenue, cost of revenue increased 190 basis points in thesix months ended June 30, 2026 to 82.7% from 80.8% in the six months ended June 30, 2025 for the reasons discussed above.

Current wording

As a percentage of revenue, cost of revenue increased 160 basis points in thenine months ended September 30, 2026 to 82.3% from 80.7% in the nine months ended September 30, 2025 as the decline in revenue outpaced the reduction in cost of revenue.

Previous wording

Our gross profit was $234 million in the six months ended June 30, 2026, a decrease of $22 million from $256 million in the six months ended June 30, 2025. Our gross margin was 17.3% in the six months ended June 30, 2026, a decrease of 190 basis points from 19.2% in the six months ended June 30, 2025.

Current wording

Our gross profit was $347 million in the nine months ended September 30, 2026, a decrease of $39 million from $386 million in the nine months ended September 30, 2025. Our gross margin was 17.7% in the nine months ended September 30, 2026, a decrease of 160 basis points from 19.3% in the nine months ended September 30, 2025.

Previous wording

Selling, general and administrative expenses decreased $35 million, or 11%, to $285 million in the six months ended June 30, 2026 from $320 million in the six months ended June 30, 2025. Declining personnel costs had the largest impact due to a reduction in headcount between periods and a decrease in share-based compensation and non-equity incentive compensation expense, partially offset by an increase in severance 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. An increase in professional fees between periods partially offset these expense reductions.

Current wording

Selling, general and administrative expenses decreased $73 million, or 15%, to $411 million in the nine months ended September 30, 2026 from $483 million in the nine months ended September 30, 2025. Declining personnel costs had the largest impact due to a reduction in headcount between periods and a decrease in share-based compensation and non-equity incentive compensation expense, partially offset by an increase in severance expense. Also driving the overall reduction in selling, general and administrative expenses was a decrease in amortization expense as certain customer relationship intangible assets reached the end of their useful lives between periods. An increase in professional fees between periods partially offset these expense reductions.

Previous wording

As a percentage of revenue, selling, general and administrative expenses decreased 290 basis points, to 21.1% in the six months ended June 30, 2026 from 24.0% in the six months ended June 30, 2025 primarily due to personnel costs and amortization expense, discussed above.

Current wording

As a percentage of revenue, selling, general and administrative expenses decreased 310 basis points, to 21.0% in the nine months ended September 30, 2026 from 24.1% in the nine months ended September 30, 2025 primarily due to personnel costs and amortization expense, discussed above.

Previous wording

Our loss from operations was $51 million in the six months ended June 30, 2026 compared to $64 million in the six months ended June 30, 2025. Our Non-GAAP Operating Profit was $58 million in the six months ended June 30, 2026, an increase of $5 million from $53 million in the six months ended June 30, 2025. 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 $64 million in the nine months ended September 30, 2026 compared to $97 million in the nine months ended September 30, 2025. Our Non-GAAP Operating Profit was $94 million in the nine months ended September 30, 2026, an increase of $9 million from $85 million in the nine months ended September 30, 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 19% in the six months ended June 30, 2026 from the six months ended June 30, 2025. Segment operating profit as a percentage of segment revenue increased by 70 basis points, reflecting a 2% increase in segment revenue, partially offset by a 1% increase in segment operating expenses. The increase in expenses was mainly driven by higher cost of revenue, which increased in-line with revenue growth between periods.

Current wording

Public Cloud operating profit increased 41% in the nine months ended September 30, 2026 from the nine months ended September 30, 2025. Segment operating profit as a percentage of segment revenue increased by 180 basis points, reflecting a 6% decrease in segment operating expenses, partially offset by a 4% decrease in segment revenue. The decrease in expenses was mainly driven by lower cost of revenue, in-line with revenue decline between periods, and reduced selling, general and administrative expenses reflecting ongoing cost management initiatives.

Previous wording

Private Cloud operating profit decreased 6% in the six months ended June 30, 2026 from the six months ended June 30, 2025. Segment operating profit as a percentage of segment revenue decreased by 130 basis points due to a 1% increase in segment operating expenses and a slight decrease in segment revenue. The increase in expenses was mainly driven by higher cost of revenue.

Current wording

Private Cloud operating profit decreased 11% in the nine months ended September 30, 2026 from the nine months ended September 30, 2025. Segment operating profit as a percentage of segment revenue decreased by 300 basis points due to a 5% increase in segment operating expenses, partially offset by a 1% increase in segment revenue. The increase in expenses was mainly driven by higher cost of revenue.

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 6% in the six months ended June 30, 2026 from the six months ended June 30, 2025 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 7% in the nine months ended September 30, 2026 from the nine months ended September 30, 2025 due to our continued focus on cost management.

Previous wording

Interest expense increased $20 million, or 48%, to $60 million in the six months ended June 30, 2026 from $41 million in the six months ended June 30, 2025 driven by the impact of our interest rate swap maturing in February 2026. Borrowings on the Revolving Credit Facility also contributed to the increase in interest expense between periods. These increases in interest expense were partially offset by repurchases of senior notes between periods, discussed below.

Current wording

Interest expense increased $34 million, or 55%, to $96 million in the nine months ended September 30, 2026 from $62 million in the nine months ended September 30, 2025 driven by the impact of our interest rate swap maturing in February 2026. Borrowings on the Revolving Credit Facility also contributed to the increase in interest expense between periods. These increases in interest expense were partially offset by repurchases of senior notes between periods, discussed below.

Previous wording

We recorded a $63 million gain on debt extinguishment in the six months ended June 30, 2026 related to repurchases of $108 million principal amount of the 3.50% FLSO Senior Secured Notes, 3.50% Senior Secured Notes, and 5.375% Senior Notes.

Current wording

We recorded a $63 million gain on debt extinguishment in the nine months ended September 30, 2026 related to repurchases of $108 million principal amount of the 3.50% FLSO Senior Secured Notes, 3.50% Senior Secured Notes, and 5.375% Senior Notes.

Previous wording

Our income tax expense was $2 million in the six months ended June 30, 2026 compared to $13 million in the six months ended June 30, 2025. Our effective tax rate increased to (3.0)% in the six months ended June 30, 2026 from (11.3)% in the six months ended June 30, 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, and the tax effects from non-deductible share-based compensation. The difference between the effective tax rate and the statutory rate for the six months ended June 30, 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.

Current wording

Our income tax expense was $6 million in the nine months ended September 30, 2026 compared to $21 million in the nine months ended September 30, 2025. Our effective tax rate increased to (5.2)% in the nine months ended September 30, 2026 from (12.1)% in the nine months ended September 30, 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, and the tax effects from non-deductible share-based compensation. The difference between the effective tax rate and the statutory rate for the nine months ended September 30, 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

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 June 30, 2026, the Revolving Credit Facility provided for up to $375 million of borrowings, $260 million of which was drawn and outstanding as of June 30, 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 indebte dness. 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 September 30, 2026, the Revolving Credit Facility provided for up to $375 million of borrowings, $290 million of which was drawn and outstanding as of September 30, 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 our ability to deliver on our strategic objectives and 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 indebte dness. 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 June 30, 2026, we held $111 million in cash and cash equivalents (not including $3 million in restricted cash, which is included in "Other non-current assets"), of which $72 million was held by foreign entities.

Current wording

At September 30, 2026, we held $108 million in cash and cash equivalents (not including $3 million in restricted cash, which is included in "Other non-current assets"), of which $66 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 $47 million outstanding with respect to these arrangements as of June 30, 2026. 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 $45 million outstanding with respect to these arrangements as of September 30, 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 $474 million outstanding with respect to operating and finance lease agreements as of June 30, 2026. 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 $500 million outstanding with respect to operating and finance lease agreements as of September 30, 2026. We may choose to utilize such leasing arrangements in future periods.

Previous wording

As of June 30, 2026, we had $2,311 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, $260 million of which was drawn and outstanding as of June 30, 2026. Our liquidity requirements are significant, primarily due to debt service requirements.

Current wording

As of September 30, 2026, we had $2,306 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, $290 million of which was drawn and outstanding as of September 30, 2026. Our liquidity requirements are significant, primarily due to debt service requirements.

Previous wording

As of June 30, 2026, the contractual interest rate on the FLSO Term Loan Facility was 6.50%. We are required to make quarterly principal payments of $4 million.

Current wording

As of September 30, 2026, the contractual interest rate on the FLSO Term Loan Facility was 6.76%. We are required to make quarterly principal payments of $4 million.

Previous wording

As of June 30, 2026, $1,602 million in aggregate principal amount of the FLSO Term Loan Facility remained outstanding.

Current wording

As of September 30, 2026, $1,597 million in aggregate principal amount of the FLSO Term Loan Facility remained outstanding.

Previous wording

As of June 30, 2026, the contractual interest rate on the FLFO Term Loan Facility was 10.00%. We are required to make quarterly principal payments of $0.7 million.

Current wording

As of September 30, 2026, the contractual interest rate on the FLFO Term Loan Facility was 10.26%. We are required to make quarterly principal payments of $0.7 million.

Previous wording

As of June 30, 2026, we had total commitments of $375 million, $260 million of outstanding borrowings under the Revolving Credit Facility, and $24 million of letters of credit issued thereunder. As such, as of June 30, 2026, we had $92 million of available commitments remaining.

Current wording

As of September 30, 2026, we had total commitments of $375 million, $290 million of outstanding borrowings under the Revolving Credit Facility, and $24 million of letters of credit issued thereunder. As such, as of September 30, 2026, we had $62 million of available commitments remaining.

Previous wording

During the six months ended June 30, 2026, we repurchased and surrendered for cancellation $70 million aggregate principal amount of the 3.50% FLSO Senior Secured Notes for $36 million, including accrued interest and fees of $0.4 million.

Current wording

During the nine months ended September 30, 2026, we repurchased and surrendered for cancellation $70 million aggregate principal amount of the 3.50% FLSO Senior Secured Notes for $36 million, including accrued interest and fees of $0.4 million.

Previous wording

Interest on the Term Loan Facility is due at the end of each interest period elected, not exceeding 90 days, for SOFR loans and at the end of every calendar quarter for base rate loans. As of June 30, 2026, the contractual interest rate on the Term Loan Facility was 6.50%. We are required to make quarterly amortization payments of $0.2 million. We are required to make certain mandatory prepayments under certain conditions defined in the credit agreement governing the Term Loan Facility.

Current wording

Interest on the Term Loan Facility is due at the end of each interest period elected, not exceeding 90 days, for SOFR loans and at the end of every calendar quarter for base rate loans. As of September 30, 2026, the contractual interest rate on the Term Loan Facility was 6.76%. We are required to make quarterly amortization payments of $0.2 million. We are required to make certain mandatory prepayments under certain conditions defined in the credit agreement governing the Term Loan Facility.