The information presented on the call, except as required by law. Our presentation includes certain non-GAAP financial measures and certain further adjustments to these measures, which we believe provide useful information to our investors. In accordance with SEC rules, we have provided a reconciliation of these measures to their most directly comparable GAAP measures in the earnings release and presentation, both of which are available on our website. After our prepared remarks, we'll take the questions. To queue up for questions, please use the Q&A function in Zoom, and I'll now turn the call over to Kevin.
Good afternoon, and thanks for joining us. I'll discuss quarterly highlights and touch on some customer case studies. Amar will go into detail on the financial results. Turning to slide five. As a best-in-class, pure-play cloud solutions company, Rackspace Technology is well-positioned in a market that is booming. Our cloud partners, AWS, Google Cloud, and Microsoft Azure, grew revenue by 40%-50% year-over-year in the fourth quarter. In addition, at the annual AWS re:Invent user conference in December, AWS CEO Adam Selipsky stated that by their estimates, the market for cloud is only 5%-15% penetrated at present. We are very early in the growth trajectory of the cloud market. Every company, whether large enterprise or small or medium-sized business, is wrestling with the move to the cloud.
Customers need help modernizing and automating, and they are choosing their partners for their cloud journey. In the fourth quarter, Rackspace Technology continued to solidify our position as the partner of choice wherever our customers are on their transition to the cloud. The financial results reflect this. Revenue and core revenue exceeded our expectations, and non-GAAP operating profit and non-GAAP EPS grew year-over-year. We delivered strong operating cash flow for the fourth quarter in a row, and for the full year, operating cash flow was over $370 million, a threefold increase in just one year. We continue to introduce new product and service offerings to help customers get the most from their cloud investment and to address unmet white spaces in the cloud market.
As an example, over 70% of SAP and Oracle ERP applications still sit in customers' data centers, and these companies know they have to modernize, move, or upgrade their solutions in the coming years. In the fourth quarter, we introduced Rackspace Elastic Engineering for ERP to address this multi-billion dollar opportunity. We also earned SAP on Google Cloud specialization in the Google Cloud Partner Advantage Program, which highlights our expertise in migrating ERP apps to the cloud. In addition, we believe the Just Analytics acquisition we announced in January will allow us to aggressively pursue the growing data analytics market. More on that in a moment. The BT partnership we announced in January will significantly enhance our presence in Europe. Turning to slide six, we continue to deliver strong revenue growth.
Total revenue was up 9%, and core revenue was up 11% compared to last year's fourth quarter. Non-GAAP operating profit was $122 million, and non-GAAP EPS was $0.25. Total bookings for the quarter were $329 million, bringing our total for the year to just over $1 billion. On slide seven, the BT deal that we closed on Christmas Eve 2021 is the biggest new business win in Rackspace Technology history and aligns us with one of the largest companies in the world as we jointly pursue the cloud market. BT called out our partnership on its most recent earnings call, saying that it benefited their customers by virtue of our cloud integration, automation, and AI capabilities.
As part of this deal, BT's hybrid cloud offerings will be based on our private cloud infrastructure, including Rackspace Services for VMware Cloud. Together with BT, we will help customers modernize their business and expedite their journey to the cloud. This partnership brings with it hundreds of new enterprise customers that will be migrated from BT to Rackspace Technology beginning in 2022. Going forward, we will be BT's premier cloud technology partner, and together, we will jointly pursue additional cloud transformation business for our private cloud customers. The BT partnership validates Rackspace Technology's right to win complex cloud deployments in the enterprise market. As you can imagine, this is a highly competitive deal with a selection process that extended well over a year, and we prevailed against some of our largest and most sophisticated competitors.
The market for cloud data and analytics is large and growing rapidly, with expectations that spend in this area will increase significantly for the next several years. On slide eight, we also announced in January that we've acquired Just Analytics, a leading provider of cloud-based data analytics and artificial intelligence services in the APJ region and a gold partner for Microsoft Azure. Founded in 2011, Just Analytics has grown from a small startup company to 100 employees, with headquarters in Singapore and 65 employees in Vietnam and India. Just Analytics helps customers design and create scalable data pipelines using its proprietary data platform, Guzzle.
That, coupled with cloud-based data and analytics services that transform data into insights, gives customers a unified view of their information assets. Data services align with our intent to build and innovate our public cloud business and help our customers move up the stack. Acquiring a market-leading company like Just Analytics is a fast way to build our capabilities and regional presence. This acquisition is similar to the successful Bright Skies tuck-in acquisition we completed in Q4 2020, in that it strengthens both our capabilities and geographic presence. On slide nine. In addition to the release of our first ESG report during the fourth quarter, we continued to improve our profile from an ESG standpoint. For the first time, we made our Carbon Disclosure Project, or CDP, environmental disclosures accessible to investors.
This will allow ESG investors to monitor and track our progress as we continue to march towards our goal of a carbon neutral profile five years ahead of the Paris Agreement deadline. We continue to win accolades for Racker Culture. In the fourth quarter, we were named a top workplace for the next generation of talent in the Next Gen 100 survey. These differentiators matter in the current war for talent, and we believe this one, in particular, will help in recruiting with Millennials and Gen Zers. We were also named the number two best place to work in IT in Mexico by Great Place to Work Mexico. From a governance standpoint, we added an additional independent director, Shashank Samant, to our board. Shashank, who is the CEO of GlobalLogic, has over 30 years of technology services industry experience and brings a passion for technology and innovation to our company.
He will bring a truly global perspective, deep industry expertise, and cloud and digital transformation experience. As I've done in past quarters, I'd like to share some case studies demonstrating the value that Rackspace Technology delivers for its customers. On slide 10, we have a case study of a customer that fits well with our ESG sustainability initiatives. VoltaGrid's mobile microgrids provide power in remote locations, but their customer-facing application also provides live emissions tracking, carbon intensity, and ESG reporting to users on a centralized database. VoltaGrid needed a complete solution that incorporated machine learning, AI, IoT, and edge computing, along with a portal through which clients could access and track real-time operations and emissions data. They tapped into Rackspace Technology's expertise for cloud-native development, Internet of Things, and security to build the VoltaGrid AI Ecosystem portal.
This entire project, including deployment of remote IoT technology, building the entire cloud infrastructure, and creating the application, was completed in less than a year. As a result, VoltaGrid was able to launch its service and enhance its product offering quicker than had initially been predicted. I'll note that in December, VoltaGrid completed a $100 million capital raise funded by ESG investors such as Canada Pension Plan Investment Board, Longbow Capital, Pilot Company, and Walter Ventures. On slide 11, Pipedrive is a global provider of SaaS software that's considered to be a unicorn in the Eastern European market. Pipedrive needed to scale its CRM sales and marketing platform to meet the requirements of its global customer base, especially those outside of the EU.
By deploying Rackspace private cloud solutions, Pipedrive was able to minimize customer response times while addressing the EU's stringent security, compliance, and data sovereignty requirements. The addition of a private cloud environment to Pipedrive's overall cloud footprint also reduced business risk in the unlikely event of data center or connectivity issues. Furthermore, we've won additional follow-on business from Pipedrive and will be expanding its AWS public cloud environment as their customers' needs continue to grow. Now Amar will take you through the financials. Amar?
Thank you, Kevin. Thank you everyone for joining our call today. Slide 13 recaps our financial results for the fourth quarter. Revenue was $777 million, a 9% year-over-year increase. Core revenue grew 11% year-over-year to $734 million. Non-GAAP operating profit was $122 million. Non-GAAP operating margin was 16%, and non-GAAP earnings per share was $0.25, all of which were on the high end of a range of expectations for the quarter. On slide 14, you see our financial results for the full year. Revenue was $3 billion, up 11% from 2020. Core revenue grew 14% for the year. Non-GAAP operating profit was $484 million, and non-GAAP operating margin was 16% for the year. Non-GAAP earnings per share was $0.97, up 17% compared to fiscal 2020.
As shown on slide 15, the actions we took to improve cash flow in 2021 delivered strong results all throughout the year. In the fourth quarter, operating cash flow was $60 million, and free cash flow was $38 million. Both of these metrics were negative in last year's fourth quarter. For the full year, operating cash flow nearly tripled. Free cash flow, which was essentially zero in 2020, accelerated to $262 million in 2021. In addition, we continued to make progress to reduce the CapEx intensity of the business. Total CapEx intensity was down a point from 8% last year to 7% this year, and total capital expenditures were down 10% compared to 2020.
As a result of the strong cash flow, we ended the year with $273 million of cash on the balance sheet and $648 million of total liquidity. On slide 16, I want to wrap up the data we have been providing on our 2020 managed public cloud cohorts. This data continues to validate the success of a land and expand strategy. With every quarterly cohort of 2020 managed public cloud customers, we have seen consistent cumulative bookings growth representing follow-on sales to these customers. More importantly, these follow-on sales are expanding the overall cumulative sold gross margins to these customers. In fact, the overall range for the sold gross margin expansion for these cohorts has increased to 300-500 basis points from 200-400 basis points previously reported.
While Rackspace Technology's corporate gross margins have been diluted by the mix shift to managed public cloud over the past two years, we believe that as we continue to successfully cross-sell and upsell higher margin services to these customers, our gross margins will stabilize. Slide 17 shows the progression of our multi-cloud revenues to growth businesses for the full year 2021. Multi-cloud represents the vast majority of our revenue at 81% of the mix, and it grew 14% year-over-year. Apps and cross-platform, at 13% of total revenue, grew 12% year-over-year, driven by growth in our application, data, and security service businesses. The 12% growth includes the negative impact of the CRM business we de-emphasized earlier this year. OpenStack, which is our legacy business, declined 20%, and this segment represented only 6% of total revenue in 2021.
Growth market offerings are now in the 75%-80% range of the multi-cloud segment and are growing over 30% year-over-year. On slide 18, we have our guidance for the first quarter. We expect total revenue in the range of $768 million-$778 million, core revenue in the range of $730 million-$738 million, non-GAAP operating profit of $108 million-$112 million, and non-GAAP EPS of $0.20-$0.22. Note that we are gearing up for the onboarding of the BT business in the first half of 2022. However, we do not expect revenue to begin ramping until the second quarter, and there will be expenses ahead of revenue as we prepare for the transition and transformation of BT customers to Rackspace Technology.
To help our investors model our business going forward, we will be providing specific quarterly guidance and color on the full year. In fiscal 2022, we expect revenue growth to accelerate through the year and anticipate double-digit revenue growth in our core business for the full year. The cloud market backdrop and the BT deal obviously point to a solid revenue growth trajectory ahead for Rackspace Technology. The cloud market is taking off. As Kevin noted, AWS sees the cloud market at 5%-15% penetrated. That is at or past the point on the S-curve where markets cross the chasm and accelerate. We spent much of the last year working on various priorities and initiatives for growth, operational efficiencies, and the right mix of business.
We planned for solid growth entering 2022, but the demand we are actually seeing is even stronger and is accelerating even faster. Hence, we continue working through a number of strategic choices. In particular, how quickly can we ramp the recently won BT deal and drive cloud transformation for BT's customers, the mix of land versus expand activity at a time of accelerating market growth, and investments to build capabilities to capture long-term growth opportunities. We have multiple paths forward and are in the process of evaluating several important strategic decisions. We plan to provide more details on our strategy and investments along with the three to five-year financial plan later this year. In closing, we are pleased with our results and accomplishments in 2021.
We delivered solid double-digit core revenue growth, strong mid-teens operating margins, and double-digit EPS growth while significantly improving the cash generating ability of our business. More importantly, we did this while continuing to execute our pivot from mature to growth businesses within multi-cloud, improving our higher margin services attached, driving overall gross margins to their highest level in two years, reducing our cost to serve with significant change in our global workforce footprint, and investing in new product offerings and service delivery. All told, we believe 2021 was a successful year, and we look forward to 2022 and beyond. With that, we'll take your questions. Joe, please go ahead and queue up the audience for Q&A.
Thanks, Amar. As a reminder, to ask a question, please use the Q&A function in the Zoom portal. Our tech team will promote you to a speaker on the webcast when you're up in the queue.
Our first question comes from Raimo Lenschow with Barclays Capital. Ashwin Shirvaikar, you're up next.
Hi. Thanks for taking my question tonight, gentlemen. I wanted to ask about the Q1 guidance and the core revenue growth. Looks like it slowed down a little bit, maybe 8.4% is where we calculated it at. A little bit slower than we anticipated. Can you give us your updated thoughts on the sort of normalized growth profile of the business? I know we can't see the full year guide at this point, but I'm just curious in terms of has your thinking changed since the IPO in terms of the normalized kind of core growth profile of the business?
Thanks, Raimo . Let me just start with the Q1 guidance first and give some color on Q1 guidance, and I will also give you color on the full year. As I mentioned in my prepared remarks, we believe that the full year the growth trajectory will accelerate as we go through the full year. When you look at our Q1 guidance specifically, the revenue is going down sequentially from Q4 to Q1, and this is as a result of typical seasonality, Raimo First, in a multi-cloud business, volumes are the highest in calendar Q4 in certain verticals like we have verticals like gaming, retail, and financial services. This typically normalizes in calendar Q1. Second, as I probably mentioned this even last year, there's always some year-end IT budget flush in our enterprise and mid-market customers.
These two factors typically makes Q4 the strongest revenue quarter of the year. We are off to a strong revenue quarter. In fact, we saw similar seasonality going from Q4 2020 to Q1 2021, and this seasonal impact in Q1 of last year, however, was masked by the ramping of a large enterprise deals that we signed in second half of 2020. Just to square off that Q1 guidance is in line with the typical seasonality, okay? Now let me give some color on, you talked about revenue deceleration in Q1. Now there are a couple of things that I wanted to point out here, right? We have been consistently growing double digits. There are two things that are playing here.
One is if you look at our apps and cross-platform business, Raimo , it's up against some very tough compares in Q1. For example, our Exodus GIR deal, our revenue lapsed in Q3 of fiscal 2021. Also remember, we de-emphasized our CRM business starting Q2 of fiscal 2021. Those two things are sort of a headwind from a year-on-year growth perspective for our apps and cross-platform business. The second aspect of it is around our multi-cloud segment. This is growing really double digits, but we do have some mixed dynamics within this segment, Raimo . If you look at the growth business within multi-cloud, it's growing solid double digits, although it's also up against some tougher compares. We feel that given the market momentum, that business will continue to grow.
The mature business within that mix is declining, and it has negatively impacted the overall growth rate of our multi-cloud segment. It's also important to note when you looked at the slide that I presented, the growth business is now more than 75% of the multi-cloud revenue mix. We are sort of nearing an inflection point there. Looking ahead into fiscal 2022, we do anticipate that the core revenue growth to accelerate through the year, and we do expect, Raimo , double-digit core revenue growth for the year. Now let me give you some more color on this and why we feel confident about it. One is we did see strong bookings momentum in Q4. Q4 was one of our record quarter from a bookings perspective.
Even excluding the BT deal, we saw strong bookings towards the end of the quarter in December compared to, say, October and November. You know, it takes time for the bookings to realize into revenue. It takes about two to four months. Number two, ramping of the BT deal that I talked about in my prepared remarks. Number three, we saw continued strong growth in managed public cloud supported by the rapid growth in the cloud market. You are seeing that in all the print by hyperscalers. Like, they're all posting about 35%-45% growth. Number four, I also want to point out that our growth will accelerate in our apps and cross-platform with strength in both data services as well as cloud native applications.
Our data services business today is small, but it has been growing consistently high double digits. We also added to Just Analytics. We added more capability in this space, and we're going to expand it globally. I would say in summary, we do believe that our core revenue, although it's sort of slowing down from a growth perspective, it's temporary, and we expect the growth rates to improve in the later half of the year.
That's very, very helpful. Thank you. One follow-up from me. I was just wondering if you could give us an update on your view of the competitive environment out there. It seems like the demand environment is pretty robust. I'm just curious if you're seeing any intensification of competition or any other factors that could impact or impair your ability to kind of accelerate that core growth.
Hey, Raimo , it's Kevin Jones. Yeah, I'll take that one. What I'll do, I'll give you my impressions of this from a market perspective, and then I'll tell you a little bit about what I'm hearing, you know, from our customers and our partners. You know, from a market perspective, you know, we're a pure play on the cloud, one of the fastest growing segments in tech. You know, as we talked about in our prepared remarks, cloud market's absolutely taking off. AWS sees the cloud market as 5%-15% penetrated. You know, this is at or past the point on the S-curve where, you know, markets really cross the chasm and accelerate.
Great potential we see in multi-cloud, both on the private cloud side and on public cloud side. The other thing about the demand environment, Ramzi, is the multi-cloud workloads that, you know, we've migrated, they are going up significantly. All the workloads that, you know, that we migrated over, we're seeing growth there. Then also additional migration work is accelerating. Then some of the demand that we have in our emerging areas like data services, cloud native apps, you know, we're planning to make additional investments in 2022 because we see those areas accelerating. In terms of demand environment, we continue to feel very good about it and, you know, we're really, I think, well-positioned in this fast-growing cloud market.
Now, when I talk to customers, you know, I've traveled all over the world talking to customers in 2021, and I've, you know, logged lots of miles in 2022 so far. Regardless of industry, Ramzi, I'm hearing the same thing from CEOs. Our customer CEOs say they wanna transform to the cloud. It's one of their top priorities. They have to do it. They've got a mandate from their board. But these customers need our help because, you know, they don't have the people to do it in-house. They don't have the technology to manage multi-cloud or the processes to do it. So we're really seeing strength across all the industries we serve, you know, public sector, airlines, healthcare, automotive, financial services, you name it. Actually, even sophisticated tech companies need our help.
You know, one of our large deals in Q4 was to help a major ISV customer migrate to multiple cloud platforms, including AWS and Azure. As our go-to-market approach continues to evolve, you know, we think there's even more industries that will open up to us. I'll end with our partners, right? I mean, you know, we've got some amazing partners. If I just focus on the public cloud hyperscalers for a minute. You know, I was on the West Coast of the U.S. last week meeting with them, so it's really top of mind. We've got thousands of joint customers with the hyperscalers, right? We sell together. We're lined up with our go-to-market teams, their sales teams all over the world.
If you just look at the hyperscalers growth, they added over $30 billion of new revenue in 2021. They're expected to add nearly $50 billion of new revenue on top of that this year. That's accelerated growth, even off a very large base. Demand environment remains very strong. We continue to enjoy a secular tailwind in the business. In meeting with CEOs of our other partners, such as VMware, Cloudflare, Datadog, Snowflake, and others, you know, we are right there with them alongside their amazing technology, and we're reinventing the future of cloud services. You know, to kind of wrap up here, demand environment's strong, the market's strong. Customers have a mandate to move to the cloud, and we're there to service this unprecedented demand.
Thanks, Kevin.
Thank you.
Our next question comes from Ashwin Shirvaikar with Citi Research. Amit Daryanani, you're on deck.
Okay, thanks, Joe. Hi, Kevin. Hi, Amar.
Hi, Ashwin.
Hey, you guys had previously said you needed to achieve $1 billion in bookings in 2021 to get double-digit organic core rev growth in 2022. Check the box on both of those. Could you clarify if the double-digit growth expectation that you mentioned in 2022 is reliant on additional 2022 bookings performance or is it, and I hate to use the term like in the bag, but is it sort of done? Also, is there a quota you sort of need to hit for bookings in 2022 to continue double-digit beyond 2021?
I would start, Ashwin, and thanks for your question, and Kevin will jump in here with other additional comments. Absolutely, no, I think we did say at the very outset of the year that if we get to $1 billion of bookings plus or minus, we should be able to deliver double-digit core revenue growth. That's you know that's the reason we are confident of hitting the double-digit core revenue growth in fiscal 2022 as the growth will accelerate through the year. In 2022, you know, the beauty of this business, the positive is, you know, you have a lot of recurring revenue base in this business.
You know, we expect our revenue base to be anywhere between 85%-90% recurring base, which states that if you just do the math, to offset some of the churn with some bookings, et cetera, you really need to go sell, build, deliver about 15% of that revenue every year, right? That gives us confidence that, you know, since you started with a good backlog, we can go and hit the double-digit core revenue growth for fiscal 2022. Now, your next question is a very important one, and this is where I think we, as management team, we are looking at the market opportunity.
For us, the market opportunity just is rapidly growing, and we believe that if we can continue to deliver a billion dollar plus of bookings, we can continue to deliver double-digit core revenue growth in fiscal 2023 and beyond. We can do better than that, Ashwin, and that's where the whole strategic choices remain and decisions remain for us, right? Do we want to go push the pedal down and make certain investments because the market is really exploding in data services, as an example, in cloud native applications? Can we go out deliver that bookings growth so that we can create a good backlog going into fiscal 2023? Those are some of the decisions we continue to make.
It's a dynamic market, and we want to make sure that we make very deliberate and thoughtful decisions as we go through this process.
Got it. On the strategic choice, part of it, you know, one of the strategic choices is the type of clients you pursue. Obviously you signed BT, which is a large client. When I look at the Just Analytics client base, some of the clients mentioned are also large. You do have sort of a preference for mid-market as you indicated in the past. Could you sort of, you know, clarify that push-pull and particularly the impact it can have on something you did well this year, which was the turnaround on the cash flow front and capital intensity?
Yeah. I think I will start here and see if I can address this, Ashwin. It's a great question, actually. Our model has always been to move towards more capital light model, right? If you look at our CapEx intensity, our CapEx intensity has actually gone down significantly in the last three years. We believe our CapEx intensity will be between, say, 5%-7% in fiscal 2022, right? It went from eight to between 5%-7%, so roughly in the midpoint at about 6% or so. We did a lot of things this year, Ashwin, as I mentioned in my prepared remark. You know, first is we pivoted the business to growth side from mature.
You saw the mix of mature business now is less than 25% of the total mix. This is outside of the legacy OpenStack business I'm talking about. This is within multi-cloud segment, the mix is less than 25%. We pushed forward on the growth side. We very selectively landed deals because it was important for us that we expand in the accounts that we land. We were very selective about it, and that was also very thoughtful strategy. You know, BT was one of our customers, but you know, you can also expect that as an expansion from landing because this is a major deal that we landed. We've been working on it for more than a year.
I think what you should expect us is continue down this path, continue to push forward into the growth areas of the business, which is on the cloud side. At the same time, we have also launched new offerings in private cloud, including Rackspace Services for VMware Cloud, which is a multi-tenant offering, which gives the same flexibility to the customer that they would get in a public cloud environment. We went after white spaces like Data Freedom by making those investments early on. We want to expand those offerings again. You should expect us to really play hard in the multi-cloud segment, both on the public cloud side as well as the private cloud side.
Yeah. I think that's really well said, and I'll just add a few points there, Ashwin. You know, I think your question about mid-market enterprise I think is a good one. You know, we continue to see a lot of opportunity in the mid-market. You know, we think that's a really good sweet spot for us. As you noted, we're having success in the enterprise market. You know, we've only been calling on the enterprise market for the last several years. You know, we won the State of Texas deal. There was the poor deal we talked about, you know, in the last earnings call, and then the BT deal. The BT deal is interesting because it brings with it BT's enterprise customers, which will further accelerate our capabilities in enterprise. We'll be selective there, right?
We wanna pick our spots. I think we've proven because of all the competitive advantages we've got, that we can win there. Multi-cloud and, you know, particularly in enterprise and mid-market is a huge area of focus for us.
Right. Thanks, Ashwin.
Thank you.
Thanks you .
All right. Our next question comes from Amit Daryanani with Evercore ISI, and Xinjun Huang, you're on deck.
Perfect. Thanks for taking my question. I guess, you know, I wanna go back to the margins for the guidance a bit. You know, I guess if I look at it on a sequential basis, you're guiding revenues to be flat, maybe down a few million dollars, but the EPS guide is down $0.04 or high teens% sequentially. Can you just talk about what is driving the drop in EPS on a sequential basis? If there's anything on the BT deal from a cost perspective that you would like to call out, that would be helpful as well.
Sure. Hi, Amit. Thanks for the question. There are two drivers here, right? One is the sequential revenue decline that is happening from Q4 to Q1 that I explained earlier. That serves as a headwind. Secondly, Amit, in our business, we also see costs go up, fringe benefit go up from calendar Q4 to Q1, and this happens every year, especially because we have a large footprint, you know, in the U.S. We are making some incremental investments, Amit, in growth market in line with what we had mentioned, you know, the way back in Q3 of last year, that we will continue to make investments in growth market, et cetera.
Those are three factors that are resulting in a sequential decline in operating profit and also EPS.
Got it. That's really helpful. You know, maybe just wanna go back to this CapEx and free cash flow discussion. You've had a really good calendar 2021 in free cash flow. How should we think about any markers or metrics around CapEx and free cash flow as I think about calendar 2022? Thank you.
Yeah, sure. So we, you know, as I mentioned before, we are very focused in generating cash for this company. We have proven that we went from $117 million of cash flow from operations, 0 free cash flow, up to $371 million. We significantly improved it, Amit, as you know. Very good working capital management across the company. I believe that, you know, we should be tracking our operating cash flow at about maybe 70% of our operating profit. That's the 70% of operating profit conversion to operating cash flow. That is a good metric to go with, right? Now, keep in mind that there will be seasonal impact during the year, Amit. You know, Q1 and Q4 are typically lower cash flow quarters for us.
For example, in Q1, there's bonus payment that annual bonus payout. In Q4, we have some big cash prepayments to some of our big vendors. Typically, Q1 and Q4 are lower. Q2 and Q3 are relatively stronger from a cash flow perspective. Now let me give you some color on the free cash flow, because you asked me this question. As I mentioned, by the way, Ashwin, you know, in my response to Ashwin, our CapEx intensity continues to go down. You know, if you recall, at the beginning of the year in fiscal 2021, I guided to a 7%-9% CapEx intensity, so CapEx as a percentage of revenue. We landed about 6.7% at the low end of that range.
I believe we'll be between 5%-7% CapEx intensity in fiscal 2022, right? If you take these models, let's say 70% of our operating profit turning around into cash flow from operations, CapEx intensity remaining between 5%-7%, you will see our free cash flow margin will be continue to remain healthy. Just as a reference, we went from 0% free cash flow margins in 2020 to 9% in fiscal 2021. Given the sort of guidance we are providing here, it'll be lower than the 9%, but it will be still healthy.
Perfect. Thank you.
Thanks, Amit.
Xinjun Huang with JPMorgan, you're up, and Keith Bachman, you're on deck.
Hey, thanks for taking my question. This is Puneet sitting in for Xinjun. What are your incremental gross margins on some of the high growth multi-cloud revenue that you are generating? Can that segment's margins be at least flat on a year-on-year basis this year?
Let me make sure when we are talking about high margin segments within multi-cloud, are you talking about the follow-on sales for this, or are you talking about the overall?
I meant like the high growth, like that 7%-5% [crosstalk].
Oh, I see. Got it.
Business, that cloud business that you have been there.
Yeah. You know, listen, I think it all depends on the mix of business, Puneet. At this point in time, given our internal plans, we are assuming that the mix of business remains the same between infrastructure and services within that growth portfolio. We expect the gross margins to be, in that particular business, to remain sort of stable. Again, it depends on the mix of infrastructure and services. That mix can change if we decide to go after more landing, you know, because there's a land grab of accounts going on. If we decide to push forward and acquire more accounts, that mix might change.
Gotcha. Thank you.
Thanks, Puneet.
Next question comes from Keith Bachman with BMO, and Frank Louthan, you're on deck. Keith, are you there? All right, let's circle back to Keith. Can we promote Frank Louthan to speaker, please?
All right. Great. Thank you. Maybe I missed this, but can you quantify how much the BT deal was in the bookings for the quarter? That'd be great. Where are we on the offshoring with the labor in terms of sort of the percentage of the shift and the total cost savings to date, and when do you think that'll be completed? Thanks.
Hey, Frank, it's Kevin here. I'll start with some color on the BT deal. BT deal was the largest deal in company history. You know, we're not disclosing the exact dollar amount, but I'll give you a bit of detail here. You know, it brings significant value to both parties and could be worth $several hundred million over multiple years. We're looking at migrating a large number of BT enterprise customers to Rackspace Technology. You know, this deal gives us the opportunity to expand our presence in 180 countries. We're excited about this. You know, BT's hybrid cloud offerings will be based on the Rackspace private cloud solution, namely Rackspace Services for VMware Cloud. Frank, that's a new offering we introduced last year. You know, this deal validates several things for us.
It validates our new private cloud offering, Rackspace Services for VMware Cloud. It validates our multi-cloud strategy, our growth potential in the enterprise market, as I mentioned earlier, our geographic expansion strategy. I think this deal also shows our competitive advantages against some of the largest competitors in the industry. We're pleased and excited about our relationship with BT. Amar, you wanna talk about offshore?
Yeah, sure. I think, Frank, as you know, when we announced the restructuring program, last year, one of the key tenets of the program was to change the global workforce footprint. If you just take a look at our offshore-onshore mix at the end of fiscal 2020, there was less than about 25% offshore, right? We improved that by more than 20 points exiting fiscal 2021. This was a significant change in our offshore mix, and we expect by mid of fiscal 2022 to be close to 50% of that mix, okay? Now, within that, you know, this is across the company, so it's not just the delivery organization or operations. This is across G&A functions. We did a massive heavy lifting in the last couple of quarters.
I'll just add to that. You know, I'm pleased with the transformation that we're undertaking with the company and the progress so far. We have still more to do. Of course, Frank, I'm also very pleased with the quality of delivery that we're getting from our onshore centers and our offshore centers and how we're working together, you know, around the clock for customers. You know, one of the things that the BT customer mentioned is one of the reasons they selected us was because of our reputation for service quality and the fanatical customer experience that we're known for all over the world. You know, as we transform the business, I look daily at-.
Statistics regarding our customer service quality, and we continue to be, you know, among the best there. We're pleased with that.
Right. Great. Thank you very much. Great.
We're gonna circle back to Keith Bachman from BMO, and then we'll wrap things up with Bryan Keane from Deutsche Bank.
Hi, can you hear me okay?
Yeah, we can hear you now, Keith. Thank you.
Okay. Yeah, sorry, not sure what happened last time. Amar, I wanted to go back to margins for a second.
You're guiding operating margins to, call it 14.2%, which is down well over 200 basis points year-over-year. You mentioned some incremental BT expense, but I was wondering if you could carve that out. More specifically, and more broadly, you've alluded to choices. You know, as you look at calendar year 2022, I was hoping you could give some context about how you're thinking about margins in 2022. In the past, what you've said is gross margins will experience some pressure because of mix through, I think, sort of the September-December quarter, but operating margins will stay flattish in these ranges. Certainly doesn't seem like Q1 margin is expected to be flattish.
I'm just wondering if you could review, if not specific numbers for the CY 2022 and philosophically, how we should be thinking about margins.
Thanks, Keith. I'll give you color on the gross margins as well as the operating margins for the year with certain assumptions here. I'll see if I can give you more transparency and clarity on the margin profile of the business as we go through fiscal 2022. Keith, based on our current internal plan that we are working with, we expect gross margins to stabilize around 30% in fiscal 2022, and our operating margins to be in the range of 14%-15%, and I'll give you more color on that shortly. Our internal plan assumes, Keith, a certain mix of business. It also assumes certain level of investments, and more importantly, the rate of ramp of the BT deal.
If these assumptions change during the year, we may have a different outcome. For example, I mentioned in my prepared remarks, Keith, that the demand is even stronger than what we had planned for in 2022. By the way, we had planned for a solid double-digit growth in 2022 from a core perspective. You know, if you see this demand increasing, which we are, we may decide to put the pedal down and go after additional long-term growth opportunities, which may change the mix and the level of investments in 2022 versus our internal plan. You know, as I said, I'm very committed to update you every quarter on the strategic decisions we may make around that and any changes that, you know, material changes to the financial model.
Okay.
That's roughly the, you know, what we are seeing. We have baked in some level of investments in the plan, in our internal plan. We want to go after growth, Keith. I'm sure you're hearing this from all the cloud providers in the cloud ecosystem. Everyone is seeing good growth to go after. You know, when we start onboarding some of these deals, it might impact our margins in the short term. These are the right things to do because we have shown based on our 2020 cohort of customers that we can expand the sold gross margins once we land these deals.
Okay. Amar-
And then-
Yeah, yeah, sorry. Kevin, did you wanna say something?
No, I think that's good, Keith.
If I think about that, I mean, I think those margins 14%-15% is a little bit lower than what investors are thinking. You said previously, OCF would be 70% of, you know, the operating dollars of profit. I obviously haven't run through my model yet, but, I mean, that suggests some pressure on free cash flow as well, I would think.
Yeah. I think you are right. Directionally, you're right, Keith, that you know, that could put some pressure on free cash flow. Also keep in mind that there is a sort of a tailwind from the restructuring cash charges that we saw in fiscal 2021. We won't see that kind of restructuring cash charges in fiscal 2022. I think those two might balance out, but you're absolutely right. As a percentage of revenue, I expect free cash flow margins to be below the 8.7% that we delivered in fiscal 2021.
Okay. Do you mind just if I sneak one in? What were those cash charges in 2021, just so we, everybody knows how to model that?
You know, I don't have a specific data here, but you know, it was. I would say net-net, it was in the I would say. Again, I'll give you more color on that in the call backs, but it should be about you know, $40 million-$50 million net-net.
Okay.
Yeah. Net-net. I will give you more color. We'll get the data for you during the call backs.
Okay. Thank you.
Thanks, Keith.
Our final question comes from Bryan Keane with Deutsche Bank. Brian, go ahead. It looks like you might be muted.
Can you hear me now?
Yeah, there you go. Thank you.
Hey, guys. Most of my questions have been asked and answered. Just, I guess, two clarifications. You know, Kevin, on the BT deal, when you sell into their enterprise customers, how does that relationship work? Is it a rev share agreement? Just trying to think about the economics and margins implications if, you know, that business takes off and a lot of BT enterprise customers start to use Rackspace. Then secondly, I guess for Amar, the cost savings, it wasn't clear to me with that massive move to offshore that you had this year, is there a cost benefit to the model and are we seeing that yet?
Yeah. I'll start with a little bit about how the BT kind of relationship will work, Brian, and then I'll let Amar provide some color and then the second question. Yeah, we're excited about this. I mean, basically, BT's got great relationships with some of the largest, you know, enterprise customers, you know, not just in Europe, but all over the world. We're BT's hybrid cloud partner. And what's gonna be happening is for a good section of those customers will be migrating those customers to our private cloud environment and our hybrid cloud environment, Rackspace Services for VMware Cloud, which is kind of a combination of kind of private private cloud with public cloud attributes.
It'll have margin profiles, you know, similar to, the rest of, that part of the business for us. It's something that's, as Amar mentioned, kind of ramping up throughout 2022. We're already very engaged with BT, as we speak. Not only do we have a chance to work and modernize these enterprise customers of BT and BT itself, but we have the opportunity to introduce them to our applications offerings, our data offerings, given the acquisition that we just did, and then further public cloud offerings, you know, depending upon where some of these enterprise customers need their workloads. It's pretty exciting, and, we'll keep you updated as we progress. Amar, anything else?
No, I think that's it. On the cost savings side, you know, we have baked in all the cost savings in our model. You know, we moved very fast in the second half of 2021 to execute on most of the cost actions. The cost savings that we had laid out on a net basis, you know, is already baked into our fiscal 2022 plan, our income plan. That's how we'll afford some of the investments that we are making in the business.
Is there a way to quantify the different types of investments you're making, Amar, just so we can, you know, try to get a sense of how much of this is ongoing, you know, could be additional, one time, you know, those kinds of charges?
Yeah. I think most of the investments are, you know, let me give you. There are two big buckets, three or four big buckets of investments, and it all depends on, for example, we continue to make investments in launching new product offerings in Data Freedom, in private cloud, et cetera. That's one big bucket. That's across, you know, our product groups. It is, and also across service delivery as examples. The second big bucket is around cloud, right? We, as Kevin mentioned, have opportunities in data services, in cloud-native application development across all the three platforms. We have done very well on the AWS side because we acquired Onica and we got a lot of skills and capabilities in AWS. We'll be scaling that.
At the same time, we'll also start scaling GCP and Azure. Those investments show even in cost of revenue because you have to, you know, you have to get ahead of the demand. We'll be hiring resources in cloud architects as an example, professional services for migration as well as for, you know, data services. We will also be investing in sales and go-to-market very selectively, because we do have, we are also improving the productivity of our sales people. We will be selectively investing in those areas. Those all investments are baked into the plan. In case we need to, if we see more growth in the market, we may go ahead and make some changes in those investments. That's all.
It's not one time. Some of it is one time start-up investments. They're close to as an ongoing, but it's supported by revenue.
Thanks, Bryan.
Thanks for taking the questions.
You bet.
All right. Well, thanks everyone for joining us. If we didn't get to your question or if you have a follow-up, please give me a shout at ir@rackspace.com. With that, thanks for joining us and have a great evening, everyone.