Kessler Topaz Meltzer & Check LLP said a securities fraud class action was filed against Rackspace Technology on behalf of investors who purchased or acquired RXT securities from May 7 through July 8, 2026. The complaint, filed in the U.S. District Court for the Southern District of New York as Morgan-Reed v. Rackspace Technology, Inc., alleges that Rackspace misrepresented or failed to disclose risks surrounding its enterprise AI strategy, declining Public Cloud revenue and a possible reduction in its infrastructure resale business. On July 9, Rackspace cut full-year 2026 revenue guidance by $150 million, lowered its Private Cloud outlook by $25 million and cited resource reallocation, investment and restructuring tied to its AI transition. Its shares fell $2.21, or 33.6%, to close at $4.37. Investors have until September 28, 2026, to seek lead-plaintiff status; participation does not require serving as lead plaintiff.