Cloud technology company Rackspace went public for the second time on Tuesday after four years in the private market following a leveraged buyout from Apollo Global Management Inc.
During that time, the company refined its focus and went from a competitor to a tight-knit partner with large-scale cloud service providers.
"One thing that's changed pretty significantly is that prior to the take-private in 2016, Rackspace Technology was competing with AWS, Google, and Microsoft," CEO Kevin Jones told Cheddar. "Today we don't compete."
The company is now focused on designing and operating software that helps clients manage
multiple cloud computing services.
Jones said coronavirus has given the company a boost as clients seek to cut costs or pivot to new business models by embracing cloud technology.
"We had a lot of momentum before, but this has really just put us into hyper-growth mode," he said.
Yet the new model didn't spare Rackspace from a tough public debut. Shares fell 20 percent at the opening bell on Wednesday, and the offering was already priced at the bottom end of its range.
Jones, however, maintains the company is still in a stronger position than ever.
"We've seen tremendous growth in the business," Jones said. "We've achieved four record-breaking sales quarters in a row. The company has 95 percent recurring revenue, we're extremely profitable, great cash flow. With this profile, we decided to come back into the public markets."
This isn't the first time Rackspace has gone public during an economic crisis. Its first IPO was in 2008 in the heat of the Great Recession.
Disney content has gone dark on YouTube TV, leaving subscribers of the Google-owned live streaming platform without access to major networks like ESPN and ABC. That’s because the companies have failed to reach a new licensing deal to keep Disney channels on YouTube TV. Depending on how long it lasts, the dispute could particularly impact coverage of U.S. college football matchups over the weekend — on top of other news and entertainment disruptions that have already arrived. In the meantime, YouTube TV subscribers who want to watch Disney channels could have little choice other than turning to the company’s own platforms, which come with their own price tags.
President Donald Trump said he has decided to lower his combined tariff rates on imports of Chinese goods to 47% after talks with Chinese leader Xi Jinping on curbing fentanyl trafficking.
Universal Music Group and AI platform Udio have settled a copyright lawsuit and will collaborate on a new music creation and streaming platform. The companies announced on Wednesday that they reached a compensatory legal settlement and new licensing agreements. These agreements aim to provide more revenue opportunities for Universal's artists and songwriters. The rise of AI song generation tools like Udio has disrupted the music streaming industry, leading to accusations from record labels. This deal marks the first since Universal and others sued Udio and Suno last year. Financial terms of the settlement weren't disclosed.
