Rackspace may sell off some of its business as the company looks to ‘sharpen its focus’ on its cloud business.
Rackspace has been pivoting its business, rolling out services aimed at helping customers migrate to the cloud and take advantage of multicloud offerings. The company now believes it may have some businesses it can offload, ones that don’t necessarily align with its overall goals, according to San Antonio Express News.
“We concluded that a sum of the parts of Rackspace Technology could be greater than our current enterprise value,” CEO Kevin Jones said in a statement. “Accordingly, we are evaluating strategic alternatives and options.”
“The market has evolved, and it’s evolved pretty rapidly in the last 18 to 24 months,” he continued. “We have a public cloud business that is significantly scaled from 18 months ago. We’ve been proactively evaluating all of our strategic options to take advantage of the public cloud market opportunity and sharpen our focus.”
The company has been posting solid growth, with its latest quarter being the tenth consecutive quarter of revenue growth. The company posted a loss of $38.5 million on $775.5 million in revenue. While a loss, it was significantly better than the $64 million the company lost on $725.9 million in revenue in the year-ago quarter.
Jones remained bullish on the company’s outlook:
“While there are near-term headwinds in the economy, such as supply chain disruption and the war in Ukraine, we do not see any recessionary pressure in this business,” he said, later adding: “Cloud is only accelerating, even in the economic environment we’ve seen so far this year.”