Akamai (AKAM)
NASDAQ:AKAM
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Akamai
(NASDAQ:AKAM)
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Rating:62Neutral
Price Target:
$124.00
▲(8.30% Upside)
Action:ReiteratedDate:02/21/26
AKAM scores in the low 60s primarily due to mixed financial quality (margin compression, weaker FCF conversion, and higher leverage) despite strong operating cash generation. The earnings call supports the score with solid growth drivers in CIS/security and notable AI/inference traction, but elevated CapEx and expected margin pressure limit upside. Technicals are moderately supportive but near-overbought signals add caution, while valuation (P/E ~32 with no dividend yield provided) remains a drag.
Positive Factors
Strong operating cash and liquidity
Akamai’s sizable cash balance and history of large buybacks show durable operating cash generation and liquidity. This underpins multi-year investments (Inference Cloud), supports strategic flexibility, and cushions the business during capex cycles or macro stress without immediate dilution.
Negative Factors
Elevated, persistent CapEx and margin pressure
A sustained material capex step-up to build inference capacity and higher hardware inflation will structurally pressure free cash flow and margins over the medium term. This reduces near-term cash available for buybacks or M&A and lowers operating leverage while capacity scales.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong operating cash and liquidity
Akamai’s sizable cash balance and history of large buybacks show durable operating cash generation and liquidity. This underpins multi-year investments (Inference Cloud), supports strategic flexibility, and cushions the business during capex cycles or macro stress without immediate dilution.
Read all positive factors
Akamai (AKAM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$16.59B
Dividend YieldN/A
Average Volume (3M)5.08M
Price to Earnings (P/E)28.1
Beta (1Y)0.39
Revenue Growth4.21%
EPS Growth-0.63%
CountryUS
Employees10,811
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)1.84
Shares Outstanding144,888,100
10 Day Avg. Volume5,653,855
30 Day Avg. Volume5,077,723
Financial Highlights & Ratios
PEG Ratio-4.08
Price to Book (P/B)2.55
Price to Sales (P/S)3.01
P/FCF Ratio18.14
Enterprise Value/Market Cap1.36
Enterprise Value/Revenue5.36
Enterprise Value/Gross Profit9.27
Enterprise Value/Ebitda16.33
Forecast
1Y Price Target
$106.47Price Target Upside-7.01% Downside
Rating ConsensusModerate Buy
Number of Analyst Covering19
EPS Forecast (FY)6.86
Revenue Forecast (FY)$4.47B
Akamai Business Overview & Revenue Model
Company Description
Akamai Technologies, Inc. provides cloud services for securing, delivering, and optimizing content and business applications over the internet in the United States and internationally. The company offers cloud solutions to keep infrastructure, web...
How the Company Makes Money
Akamai makes money primarily by selling subscription- and usage-based services delivered over its distributed edge network and security platform. Key revenue streams include: (1) Security solutions: recurring revenue from web application and API p...
Akamai Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where the company is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlyAkamai Earnings Call Summary
Earnings Call Date:Feb 19, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Positive
The call presented a broadly positive operational and financial picture: top-line growth, strong margin and EPS performance in Q4, rapid acceleration in Cloud Infrastructure Services and security products, a major multi-year $200M CIS commitment, and a sold-out early Inference Cloud deployment with plans to scale. Offsetting these positives are meaningful near-term investments and cost pressures: elevated 2026 CapEx (driven by Inference Cloud build and higher memory/GPU prices), expected margin compression in 2026, continued delivery revenue declines, and supply/FX risks. Overall, the company appears to be investing aggressively to capitalize on AI and CIS momentum, accepting short-term margin and cash impacts to pursue higher-growth compute and security opportunities.Positive Updates
Quarterly Revenue and EPS Growth
Q4 revenue of $1.095 billion, up 7% year-over-year (6% in constant currency). Non-GAAP EPS $1.84, up 11% year-over-year (reported and constant currency). Non-GAAP operating margin of 29% in Q4.
Negative Updates
Delivery Revenue Decline and Pressure
Delivery revenue was $311 million in Q4, down 2% year-over-year (down 3% in constant currency). Management expects delivery and other cloud apps to decline mid-single digits in 2026.
Read all updates
Q4-2025 Updates
Positive
Negative
Quarterly Revenue and EPS Growth
Q4 revenue of $1.095 billion, up 7% year-over-year (6% in constant currency). Non-GAAP EPS $1.84, up 11% year-over-year (reported and constant currency). Non-GAAP operating margin of 29% in Q4.
Read all positive updates
Company Guidance
Akamai’s guidance for Q1 2026 calls for revenue of $1.06B–$1.085B (up 4–7% y/y as reported, 2–5% in constant currency; spot FX +$4M vs Q4 and +$22M y/y), cash gross margins ~71–72%, non‑GAAP operating expenses $339M–$348M, EBITDA margin ~39–41%, non‑GAAP depreciation $145M–$147M, non‑GAAP operating margin ~26–27%, non‑GAAP EPS $1.50–$1.67 (assumes taxes $57M–$60M at ~19% and ~148M diluted shares), and Q1 CapEx $254M–$264M (23–25% of revenue). For full‑year 2026 they forecast revenue $4.40B–$4.55B (up 5–8% reported, 4–7% CC), Security growth in the high single digits (CC), Cloud Infrastructure Services (CIS) accelerating to ~45–50% y/y (CIS + OCA combined at least 20% y/y), delivery and other cloud apps down mid‑single digits, an FX tailwind of ~$36M y/y, full‑year non‑GAAP operating margin ~26–28%, CapEx ~23–26% of revenue (breakdown roughly 4% network for delivery & security, 10–13% compute, ~8% capitalized software), and non‑GAAP EPS $6.20–$7.20 (assumes ~19% tax rate and ~147M shares); management also plans to invest about $250M in 2026 to scale the AI Inference Cloud and has adjusted CapEx up ~ $200M due to memory/server price inflation.Akamai Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
56
Neutral
Cash Flow
60
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 4.21B | 3.99B | 3.81B | 3.62B | 3.46B |
| Gross Profit | 2.30B | 2.37B | 2.30B | 2.23B | 2.19B |
| EBITDA | 1.34B | 1.26B | 1.24B | 1.26B | 1.35B |
| Net Income | 452.03M | 504.92M | 547.63M | 523.67M | 651.64M |
Balance Sheet | |||||
| Total Assets | 11.48B | 10.37B | 9.90B | 8.30B | 8.14B |
| Cash, Cash Equivalents and Short-Term Investments | 1.19B | 1.60B | 864.44M | 1.11B | 1.08B |
| Total Debt | 6.91B | 4.63B | 4.54B | 3.17B | 2.86B |
| Total Liabilities | 6.50B | 5.49B | 5.30B | 3.94B | 3.61B |
| Stockholders Equity | 4.98B | 4.88B | 4.60B | 4.36B | 4.53B |
Cash Flow | |||||
| Free Cash Flow | 699.26M | 833.90M | 618.40M | 816.37M | 859.33M |
| Operating Cash Flow | 1.52B | 1.52B | 1.35B | 1.27B | 1.40B |
| Investing Cash Flow | -540.74M | -798.68M | -1.85B | -622.31M | -646.90M |
| Financing Cash Flow | -588.04M | -679.63M | 443.38M | -634.18M | -562.00M |
Akamai Technical Analysis
Positive
114.50
Price Trends
101.94
Positive
94.27
Positive
85.57
Positive
Market Momentum
4.35
Negative
62.56
Neutral
77.22
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AKAM, the sentiment is Positive. The current price of 114.5 is above the 20-day moving average (MA) of 107.51, above the 50-day MA of 101.94, and above the 200-day MA of 85.57, indicating a bullish trend. The MACD of 4.35 indicates Negative momentum. The RSI at 62.56 is Neutral, neither overbought nor oversold. The STOCH value of 77.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive 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 |
|---|---|---|---|---|---|---|---|
72 Outperform | $57.86B | 31.84 | 123.64% | ― | 14.78% | 22.52% | |
69 Neutral | $93.73B | -686.05 | -4.68% | ― | 22.05% | -341.24% | |
66 Neutral | $21.41B | -232.70 | -3.48% | ― | 23.24% | -8.83% | |
62 Neutral | $16.59B | 28.07 | 9.64% | ― | 4.21% | -0.63% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
57 Neutral | $71.46B | -671.68 | -7.48% | ― | 28.06% | -7.44% | |
41 Neutral | $6.64B | -84.00 | -8.01% | ― | 23.38% | -30.16% |
* Technology Sector Average
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Akamai Corporate Events
Business Operations and StrategyExecutive/Board Changes
Akamai Adopts 2026 Performance-Based Executive Compensation Plan
Positive
Feb 17, 2026
On February 11, 2026, Akamai’s board committee approved a 2026 bonus and equity compensation framework for its top executives, tying annual incentives to revenue and adjusted operating income targets, with all bonuses paid in vested stock ra...
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.