Rackspace shares jump after AMD AI partnership and layoffs

Shares of Rackspace Technology surged this week following the company's announcement of a definitive partnership with Advanced Micro Devices and a significant workforce reduction aimed at funding a strategic pivot to artificial intelligence infrastructure. The cloud services provider saw its stock price jump sharply in trading on Tuesday and Wednesday, extending a dramatic rally that has made it one of the top-performing stocks of 2026.

The company finalized a binding agreement with AMD for the phased deployment of up to 30 megawatts of dedicated AI compute capacity across its global data centers. The rollout is scheduled to begin in late 2026 and continue through 2028, utilizing AMD's latest Instinct GPUs and EPYC processors. CEO Gajen Kandiah stated the partnership is designed to provide governed AI environments for enterprise customers, particularly in regulated industries like healthcare and finance, where a single accountable operator is required.

Concurrently, Rackspace disclosed a workforce realignment plan approved on June 10 that will eliminate approximately 15 percent of its global staff. The company said the cuts will primarily affect legacy service delivery...