Rackspace Technology(RXT) - 2024 Q4 - Annual Results

Revenue Performance - Fourth quarter 2024 revenue was $686 million, a decrease of 5% year-over-year from $720 million in Q4 2023[4]. - Full year 2024 revenue totaled $2,737 million, a decrease of 7% from $2,957 million in 2023[8]. - Total revenue for the year ended December 31, 2024, was $2,737.1 million, a decrease of 7.4% compared to $2,957.1 million in 2023[39]. - Public Cloud revenue for Q4 2024 was $417 million, down 4% year-over-year[4][5]. - Private Cloud revenue for Q4 2024 was $269 million, down 6% year-over-year[4][5]. - Public Cloud revenue for the year ended December 31, 2024, was $1,682.6 million, down 3.4% from $1,742.7 million in 2023[39]. - Private Cloud revenue for the year ended December 31, 2024, was $1,054.5 million, a decrease of 13.2% from $1,214.4 million in 2023[39]. Profit and Loss - The net loss for Q4 2024 was $(60) million, compared to a net income of $28 million in Q4 2023, resulting in a net loss per diluted share of $(0.26)[5][6]. - Full year 2024 net loss was $(863) million, compared to a net loss of $(838) million in 2023, with a net loss per diluted share of $(3.84)[9]. - Non-GAAP Operating Profit for Q4 2024 was $39 million, a decrease of 13% compared to $45 million in Q4 2023[6]. - Non-GAAP Operating Profit for the year ended December 31, 2024, was $105.6 million, down 32.8% from $157.2 million in 2023[51]. - Non-GAAP Net Loss for Q4 2024 was $(4.4) million, an improvement from $(8.9) million in Q4 2023[50]. - Non-GAAP Net Loss for the year ended December 31, 2023 was $(52.1) million, with a projected increase in loss to $(63.5) million for 2024[57]. - The company reported a net income of $(60.4) million for Q4 2024, compared to a net income of $28.0 million in Q4 2023[50]. - Net income for Q4 2023 was $28.0 million, while the projected net loss for Q4 2024 is $(60.4) million, indicating a significant decline[52]. Cash Flow and Assets - Cash provided by operating activities for 2023 was $374.9 million, significantly higher than $39.9 million in 2024[30]. - Total assets as of December 31, 2023, were $4,096.2 million, compared to $3,051.0 million in 2024[28]. - Cash and cash equivalents at the end of 2023 were $199.7 million, down from $147.0 million in 2024[30]. Expenses and Liabilities - Capital expenditures in Q4 2024 were $27 million, down from $38 million in Q4 2023[7]. - Total liabilities for 2023 were $4,250.7 million, slightly up from $4,059.6 million in 2024[28]. - The company recognized $56.7 million in restructuring and transformation expenses for 2023, with an increase to $58.5 million expected in 2024[52]. - Interest expense for the year ended December 31, 2023 was $221.6 million, with a significant reduction to $98.0 million projected for 2024 due to refinancing transactions[52]. Future Guidance - The company expects Q1 2025 revenue guidance of $653 - $665 million, with Private Cloud revenue projected at $247 - $253 million and Public Cloud revenue at $406 - $412 million[13]. - Non-GAAP Loss Per Share for Q1 2025 is expected to be between $(0.07) and $(0.09)[13]. Bookings and Sales Performance - Fiscal 2024 bookings grew 14% year-over-year, indicating strong sales execution across both business units[3]. Impairment and Shareholder Impact - Impairment of goodwill for 2023 was $708.8 million, compared to $714.9 million in 2024, indicating a stable impairment level[25]. - The weighted average number of diluted shares increased from 215.3 million in 2023 to 224.8 million in 2024, indicating a dilution effect on earnings per share[57]. - Non-GAAP Loss Per Share for 2023 was $(0.24), with a projected loss of $(0.27) for 2024, reflecting a worsening performance[57]. - The company incurred $708.8 million in goodwill impairment for the year ended December 31, 2023, with an increase to $714.9 million expected in 2024[52]. Segment Performance - Public Cloud segment operating profit decreased by 60.9% year-over-year to $9.9 million in Q4 2024[35]. - Private Cloud segment operating profit increased by 5.1% year-over-year to $80.6 million in Q4 2024[35]. - Non-GAAP Gross Profit for Q4 2024 was $141.2 million, compared to $157.5 million in Q4 2023[41]. - Adjusted EBITDA for the year ended December 31, 2023 was $362.6 million, down from $244.8 million projected for 2024, reflecting a decrease of approximately 32.5%[52].