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Akamai
(NASDAQ:AKAM)
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Rating:64Neutral
Price Target:
$98.00
▼(-7.32% Downside)
Action:Reiterated
Date:09/25/26
The score is primarily constrained by moderating financial quality—especially margin compression and a sharp rise in leverage—despite continued revenue growth and positive cash generation. Technicals are supportive with moderately positive momentum and the stock trading above key moving averages, while valuation is a headwind given the high P/E and no dividend yield provided. The latest earnings call adds a constructive overlay via clear guidance and strong CIS/security momentum, but near-term margin and cash-flow pressure from very high CapEx remains a key risk.
Positive Factors
CIS Growth and Bookings
Rapid CIS growth and more than $2.8 billion of signed multiyear commitments strengthen revenue visibility and expand Akamai’s role in cloud infrastructure. This supports a durable transition toward higher-growth AI and edge workloads, provided execution converts bookings into revenue.
Negative Factors
Higher Leverage
The sharp increase in debt has reduced financial flexibility and raised the company’s exposure to profitability or execution setbacks. With returns on equity also declining, leverage may constrain future capital allocation and make the investment cycle harder to absorb.
Read all positive and negative factors
Positive Factors
Negative Factors
CIS Growth and Bookings
Rapid CIS growth and more than $2.8 billion of signed multiyear commitments strengthen revenue visibility and expand Akamai’s role in cloud infrastructure. This supports a durable transition toward higher-growth AI and edge workloads, provided execution converts bookings into revenue.
Read all positive factors
Akamai Key Performance Indicators (KPIs)
Any
Revenue by Geography
Maps revenue across countries and regions to show where Akamai is strongest and where it can expand; useful for spotting concentration risk, regional growth opportunities, and sensitivity to local economic or regulatory changes.
Maps revenue across countries and regions to show where Akamai is strongest and where it can expand; useful for spotting concentration risk, regional growth opportunities, and sensitivity to local economic or regulatory changes.
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The Fly
The FlyAkamai (AKAM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$12.88B
Dividend YieldN/A
Average Volume (3M)5.80M
Price to Earnings (P/E)31.8
Beta (1Y)0.61
Revenue Growth5.87%
EPS Growth-0.31%
CountryUS
Employees11,000
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)2.84
Shares Outstanding143,716,610
10 Day Avg. Volume5,535,066
30 Day Avg. Volume5,800,436
Financial Highlights & Ratios
PEG Ratio-4.07
Price to Book (P/B)2.55
Price to Sales (P/S)3.01
P/FCF Ratio18.14
Enterprise Value/Market Cap1.87
Enterprise Value/Revenue5.59
Enterprise Value/Gross Profit9.90
Enterprise Value/Ebitda18.78
Forecast
1Y Price Target
$153.11Price Target Upside44.79% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering22
EPS Forecast (FY)6.68
Revenue Forecast (FY)$4.49B
Akamai Business Overview & Revenue Model
Company Description
Akamai Technologies, Inc. (AKAM) is a leading global provider of cloud services, specializing in the secure delivery, optimization, and protection of online content and business applications across the internet. The company's primary focus involve...
How the Company Makes Money
Akamai primarily makes money by selling subscription-based and usage-based services delivered over its distributed network and security platform. Revenue is largely generated from customers contracting for (1) security services and (2) delivery an...
Akamai Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 05, 2026
Earnings Call Sentiment Positive
The call conveyed strong strategic momentum driven by rapid CIS growth, sizable multiyear bookings (> $2.8B) including a $600M GPU deal, accelerating AI/edge positioning, and durable security demand (security revenue +10% YoY, >$2.4B expected in 2026). These positives were balanced against near-term pressures: a decline in delivery revenue, downward movement in non-GAAP net income/EPS year-over-year, heavy and front-loaded CapEx (Q3 guidance implies >40% of revenue), sold-out GPU capacity creating timing constraints, FX headwinds, and a temporary pause to buybacks. Management provided concrete guidance (Q3 and full-year) and a clear path to accelerated growth in 2027, signaling confidence in the long-term prospects despite near-term investment-driven margin pressure.Positive Updates
Company-wide Revenue Growth
Q2 revenue of $1.1 billion, up 5% year over year (reported and constant currency); full-year 2026 revenue guidance $4.445B–$4.530B, up 6%–8% (5%–7% in constant currency). Management expects revenue growth to accelerate into the low teens in 2027.
Negative Updates
Delivery & Other Cloud Applications Decline
Delivery and other cloud applications revenue declined to $396 million in Q2, down 6% year over year (down 5% in constant currency), reflecting ongoing pressure in the mature delivery business.
Read all updates
Q2-2026 Updates
Positive
Negative
Company-wide Revenue Growth
Q2 revenue of $1.1 billion, up 5% year over year (reported and constant currency); full-year 2026 revenue guidance $4.445B–$4.530B, up 6%–8% (5%–7% in constant currency). Management expects revenue growth to accelerate into the low teens in 2027.
Read all positive updates
Company Guidance
Akamai guided Q3 revenue of $1.105–$1.130B (up 5–7% reported, 5–8% constant currency) with a Q3 FX headwind of ~$2M (and a Y/Y Q3 FX impact of ~$8M); it expects Q3 cash gross margin ~70%, non‑GAAP operating expenses $347–359M, EBITDA margin ~38–40%, non‑GAAP depreciation $153–155M, non‑GAAP operating margin 24–26% and non‑GAAP EPS $1.60–1.80 (assumes ~19% non‑GAAP tax rate, ~$0.55–$2M taxes, ~150M diluted shares). Q3 CapEx was guided to $475–525M (~43–46% of revenue) and full‑year CapEx is expected to be ~40% of revenue. For full‑year 2026 the company expects revenue of $4.445–4.530B (up 6–8% reported, 5–7% cc), cloud infrastructure services growth of at least 50% cc, security revenue growth in the high single digits cc, delivery/other cloud apps down mid single digits cc, a full‑year non‑GAAP operating margin of ~25–26% and non‑GAAP EPS of $6.40–7.05 (19% tax rate, ~150M shares). Management also called out second‑half FX headwinds of ~ $9M, Q2 CapEx of $347M (32% of revenue), cash of ~ $4.6B, $3.5B raised via zero‑coupon convertible debt, a temporary pause to buybacks after repurchasing ~5M shares YTD (~$616M, ~$565M remaining authorization), and up to $500M of planned GPU investment (about $60M in 2026, remainder in early 2027) to replenish sold‑out GPU capacity.Akamai Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
55
Neutral
Cash Flow
61
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.32B | 4.21B | 3.99B | 3.81B | 3.62B | 3.46B |
| Gross Profit | 2.44B | 2.30B | 2.37B | 2.30B | 2.23B | 2.19B |
| EBITDA | 1.29B | 1.34B | 1.26B | 1.24B | 1.26B | 1.35B |
| Net Income | 410.96M | 452.03M | 504.92M | 547.63M | 523.67M | 651.64M |
Balance Sheet | ||||||
| Total Assets | 15.07B | 11.48B | 10.37B | 9.90B | 8.30B | 8.14B |
| Cash, Cash Equivalents and Short-Term Investments | 3.36B | 1.19B | 1.60B | 864.44M | 1.11B | 1.08B |
| Total Debt | 9.34B | 6.91B | 4.63B | 4.54B | 3.17B | 2.86B |
| Total Liabilities | 10.32B | 6.50B | 5.49B | 5.30B | 3.94B | 3.61B |
| Stockholders Equity | 4.75B | 4.98B | 4.88B | 4.60B | 4.36B | 4.53B |
Cash Flow | ||||||
| Free Cash Flow | 629.88M | 699.26M | 833.90M | 618.40M | 816.37M | 859.33M |
| Operating Cash Flow | 1.45B | 1.52B | 1.52B | 1.35B | 1.27B | 1.40B |
| Investing Cash Flow | -3.31B | -540.74M | -798.68M | -1.85B | -622.31M | -646.90M |
| Financing Cash Flow | 2.49B | -588.04M | -679.63M | 443.38M | -634.18M | -562.00M |
Akamai Technical Analysis
Negative
105.74
Price Trends
106.56
Negative
115.32
Negative
112.32
Negative
Market Momentum
-5.48
Positive
36.60
Neutral
19.08
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AKAM, the sentiment is Negative. The current price of 105.74 is above the 20-day moving average (MA) of 100.72, below the 50-day MA of 106.56, and below the 200-day MA of 112.32, indicating a bearish trend. The MACD of -5.48 indicates Positive momentum. The RSI at 36.60 is Neutral, neither overbought nor oversold. The STOCH value of 19.08 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AKAM.
Akamai Risk Analysis
Akamai disclosed 32 risk factors in its most recent earnings report. Akamai reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Akamai Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $25.97B | 36.11 | 19.86% | ― | 9.41% | 10.59% | |
72 Outperform | $2.81B | 23.17 | 7.42% | ― | 5.79% | 65.56% | |
67 Neutral | $1.82B | 41.75 | 19.61% | 0.96% | 12.20% | -13.97% | |
66 Neutral | $103.86B | -527.13 | -13.86% | ― | 33.53% | -72.17% | |
65 Neutral | $1.23B | 77.09 | 5.05% | ― | 9.98% | 18.53% | |
64 Neutral | $12.88B | 31.79 | 8.49% | ― | 5.87% | -0.31% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
AKAM
Akamai
91.13
16.52
22.14%
FFIV
F5, Inc.
450.08
148.22
49.10%
NTCT
Netscout Systems
38.31
11.83
44.68%
RDWR
Radware
29.78
3.54
13.49%
ATEN
A10 Networks
24.56
6.73
37.77%
NET
Cloudflare
303.61
86.45
39.81%
Akamai Corporate Events
Business Operations and StrategyPrivate Placements and FinancingRegulatory Filings and Compliance
Akamai Expands Anthropic Partnership and AI Infrastructure Capacity
Positive
Sep 24, 2026
On September 24, 2026, Akamai announced a seven-year, $11.6 billion expansion of its relationship with Anthropic, under project plans that provide dedicated cloud computing capacity and managed services to support Anthropic’s growing CPU wor...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.