Rackspace (NASDAQ: RXT), the operator of the full enterprise AI stack, and Blacksmith, the infrastructure platform for building and testing code, today announced a multi-year agreement under which Rackspace will provide dedicated compute, powered by AMD EPYC CPUs, together with storage representing approximately 2 MW of capacity in Northern Virginia. The capacity is expected to begin deploying in early 2027, providing Blacksmith with a long-term partner to accelerate software delivery lifecycles and power the modern wave of AI-driven software development.
“When we talk to developers and engineering teams, we keep hearing that AI is making it much easier to write code, but getting those changes tested and ready to ship is becoming the bottleneck. We’re building Blacksmith to help developers merge code faster and feel confident about what they’re shipping. Our partnership with Rackspace will help us scale the infrastructure behind that work,” said Blacksmith CEO Aditya “JP” Jayaprakash.
The increasing adoption of AI coding tools and autonomous agents is now driving growth for Blacksmith as development teams seek to accelerate software delivery.
With AI models now generating substantial pull requests and drafting thousands of lines of code in seconds, the constraint is no longer writing code, it is verifying whether that AI-generated code is built and tested before it can be merged.
RXT shares dropped 29 cents, or 10.7%, to $3.01.
