"Rackspace Technology ( ) continues to experience an extraordinary rally following the announcement of a strategic alliance with Palantir Technologies ( | PLTR Price Prediction). The stock, which was trading at a mere $0.42 per share just days ago, exploded by 227% in the immediate aftermath of the announcement, and is surging another 50% in morning trading today, pushing its value even higher amid frenzied buying."
"Touted as a game-changer for Rackspace in the artificial intelligence (AI) landscape, but beneath the surface excitement lies a company grappling with deep-seated challenges. While the deal may provide a temporary lifeline for Rackspace to soldier on, this is more a case of inflated AI hype, similar to when any company announcing a deal with OpenAI last year saw its stock melt up . But Rackspace remains a risky bet that's best avoided for most investors."
"Rackspace, with its longstanding reputation in handling complex enterprise IT environments, will serve as a primary provider of managed services. This includes everything from expert implementation and cloud hosting to seamless data migration and robust security protocols, particularly for sectors under strict regulatory scrutiny like finance, healthcare, and government. By utilizing Rackspace's private cloud infrastructure and specialized data centers in the U.K., the partnership aims to drastically reduce setup times - from what could take months or even years down to just weeks."
Rackspace Technology's stock surged from $0.42 to a 227% jump after announcing a strategic alliance with Palantir, followed by an additional 50% intraday rise amid heavy buying. The alliance focuses on accelerating deployment and management of Palantir's Foundry data operating system and its Artificial Intelligence Platform (AIP). Rackspace will provide managed services including implementation, cloud hosting, data migration, and enhanced security for regulated sectors using private cloud infrastructure and U.K. data centers to reduce deployment from months or years to weeks. Palantir is expanding into commercial markets with AIP enabling custom AI applications. Significant company challenges and AI-driven hype increase investment risk.
Read at 24/7 Wall St.
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