Rackspace Technology Inc gross margin has been in long-term decline. The average rate of decline per year is -14.6%.
The historical rank and industry rank for Rackspace Technology's Gross Margin % or its related term are showing as below:
RXT'
s Gross Margin % Range Over the Past 10 Years
Min: 19.49 Med: 33.75 Max: 41.47
Current: 19.49
During the past 8 years, the highestGross Margin % of Rackspace Technology was 41.47%. The lowest was 19.49%. And the median was 33.75%.
RXT's Gross Margin % is ranked worse than 81.97% of 2607
companies
in the Software industry
Industry Median: 40.75
vs RXT: 19.49
Rackspace Technology had a gross margin of 19.21% for the quarter that ended in Dec. 2024 => No sustainable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Rackspace Technology was -14.60% per year.
Rackspace Technology Gross Margin % Historical Data
The historical data trend for Rackspace Technology's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Competitive Comparison of Rackspace Technology's Gross Margin %
For the Software - Infrastructure subindustry, Rackspace Technology's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Rackspace Technology's Gross Margin % Distribution in the Software Industry
For the Software industry and Technology sector, Rackspace Technology's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Rackspace Technology's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
Rackspace Technology had a gross margin of 19.21% for the quarter that ended in Dec. 2024 => No sustainable competitive advantage
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
Rackspace Technology Gross Margin % Related Terms
Thank you for viewing the detailed overview of Rackspace Technology's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Rackspace Technology Inc is an end-to-end, hybrid, multi cloud technology services company. It designs, builds and operates its customers' cloud environments across all technology platforms, irrespective of technology stack or deployment model. The company's solutions include Application Services; Data; Colocation; Cloud; Managed Hosting; Professional Services; and Security & Compliance. It operates in segments namely, Private Cloud, and Public Cloud. It generates revenue through the sale of consumption-based contracts for its service offerings and from the sale of professional services related to designing and building custom solutions.
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