Akamai (AKAM) AI Stock Analysis

• Market Cap: $12.96B
• Dividend Yield: N/A
• Average Volume (3M): 3.63M
• Price to Earnings (P/E): 26.2
• Beta (1Y): 0.65
• Revenue Growth: 4.21%
• EPS Growth: -0.63%
• Country: US
• Employees: 10,811
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 1.86
• Shares Outstanding: 143,865,230
• 10 Day Avg. Volume: 2,648,337
• 30 Day Avg. Volume: 3,629,401
• PEG Ratio: -4.12
• Price to Book (P/B): 2.97
• Price to Sales (P/S): 3.63
• P/FCF Ratio: 17.36
• Enterprise Value/Market Cap: 1.16
• Enterprise Value/Revenue: 3.65
• Enterprise Value/Gross Profit: 6.17
• Enterprise Value/Ebitda: 10.67
• 1Y Price Target: $96.83
• Price Target Upside: 8.52% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 16
• EPS Forecast (FY): 7.04
• Revenue Forecast (FY): $4.19B

• Rating: 73 Outperform
• Price Target: $95.00 ▲(6.47% Upside)

Akamai's overall stock score reflects strong earnings performance and strategic initiatives in cloud and security, which are driving growth. However, valuation concerns and technical indicators suggest caution. The company's increasing leverage and challenges in the delivery segment are risks to monitor.

Positive Factors

Cloud Infrastructure Growth

Significant growth in cloud infrastructure services indicates strong demand and positions Akamai well in the expanding cloud market.

Security Product Expansion

The robust growth in security products showcases Akamai's competitive edge in cybersecurity, a critical area for long-term growth.

AI Inference Cloud Launch

The launch of the AI Inference Cloud with NVIDIA enhances Akamai's technological capabilities, opening new revenue streams in AI applications.

Negative Factors

Rising Debt Levels

Increased leverage could strain financial flexibility, posing risks if not managed, especially in economic downturns.

Delivery Revenue Decline

Declining delivery revenue highlights challenges in this segment, potentially impacting Akamai's overall revenue mix.

Compute Revenue Challenges

Underperformance in compute revenue suggests potential delays in contract execution, affecting short-term revenue growth.

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, websites, applications, application programming interfaces, and users safe from various cyberattacks and online threats while enhancing performance. It also provides web and mobile performance solutions to enable dynamic websites and applications; media delivery solutions, including video streaming and video player services, game and software delivery, broadcast operations, authoritative domain name system, resolution, and data and analytics; and edge compute solutions to enable developers to deploy and distribute code at the edge. In addition, the company offers carrier offerings, including cybersecurity protection, parental controls, DNS infrastructure and content delivery solutions; and an array of service and support to assist customers with integrating, configuring, optimizing, and managing its offerings. It sells its solutions through direct sales and service organizations, as well as through various channel partners. Akamai Technologies, Inc. was incorporated in 1998 and is headquartered in Cambridge, Massachusetts.

How the Company Makes Money

Akamai generates revenue primarily through a subscription-based model and usage-based fees for its CDN and cloud security services. The company's key revenue streams include sales from its web performance solutions, security solutions, and media delivery services. Akamai's partnerships with major cloud providers and enterprises enhance its offerings and expand its market reach, while its extensive network of servers strategically positioned around the globe allows for optimized content delivery and increased customer satisfaction. Additionally, the company's focus on innovation and investment in new technologies, such as edge computing and enhanced security measures, contribute to its revenue growth by attracting new clients and retaining existing customers.

Akamai Financial Statement Overview

Summary

Akamai demonstrates solid financial health with consistent revenue growth and profitability. The company maintains a strong cash flow position, but the increasing leverage on the balance sheet warrants attention. The company should focus on managing its debt levels to sustain long-term financial stability.

Income Statement

Akamai's income statement shows a steady revenue growth with a TTM growth rate of 1.22%. The gross profit margin is healthy at 59.13%, although it has slightly decreased from previous years. The net profit margin is stable at 12.26%, indicating consistent profitability. However, the EBIT and EBITDA margins have seen a decline, suggesting increased operational costs or other expenses impacting earnings before interest and taxes.

Balance Sheet

The balance sheet reveals a moderate debt-to-equity ratio of 1.11, which has increased over the years, indicating higher leverage. The return on equity is reasonable at 10.86%, showing effective use of equity to generate profits. The equity ratio is stable, reflecting a balanced asset structure, but the rising debt levels could pose a risk if not managed carefully.

Cash Flow

Akamai's cash flow statement is strong, with a positive free cash flow growth rate of 5.80% in the TTM. The operating cash flow to net income ratio is robust at 1.57, indicating efficient cash generation from operations. The free cash flow to net income ratio is 0.48, showing a good conversion of income into free cash flow, although slightly lower than previous years.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.13B	3.99B	3.81B	3.62B	3.46B	3.20B
Gross Profit	2.44B	2.37B	2.30B	2.23B	2.19B	2.07B
EBITDA	1.41B	1.26B	1.24B	1.26B	1.35B	1.16B
Net Income	506.86M	504.92M	547.63M	523.67M	651.64M	557.05M
Balance Sheet
Total Assets	10.83B	10.37B	9.90B	8.30B	8.14B	7.76B
Cash, Cash Equivalents and Short-Term Investments	1.12B	1.60B	864.44M	1.11B	1.08B	1.10B
Total Debt	5.23B	4.63B	4.54B	3.17B	2.86B	2.78B
Total Liabilities	6.10B	5.49B	5.30B	3.94B	3.61B	3.51B
Stockholders Equity	4.73B	4.88B	4.60B	4.36B	4.53B	4.25B
Cash Flow
Free Cash Flow	718.30M	833.90M	618.40M	816.37M	859.33M	483.13M
Operating Cash Flow	1.50B	1.52B	1.35B	1.27B	1.40B	1.22B
Investing Cash Flow	-418.54M	-798.68M	-1.85B	-622.31M	-646.90M	-1.04B
Financing Cash Flow	-727.17M	-679.63M	443.38M	-634.18M	-562.00M	-223.64M

Akamai Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 89.23
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

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 89.23 is above the 20-day moving average (MA) of 87.50, above the 50-day MA of 82.76, and above the 200-day MA of 78.96, indicating a bullish trend. The MACD of 1.39 indicates Negative momentum. The RSI at 59.83 is Neutral, neither overbought nor oversold. The STOCH value of 82.48 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AKAM.

Akamai Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AKAM	73 Outperform	$12.96B	26.16	10.64%	―	4.21%	-0.63%
FTNT	71 Outperform	$60.79B	33.21	228.04%	―	14.78%	22.52%
CRWD	67 Neutral	$121.80B	―	-8.88%	―	22.05%	-341.24%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
NET	61 Neutral	$68.54B	―	-8.88%	―	28.06%	-7.44%
ZS	60 Neutral	$37.01B	-873.93	-2.41%	―	23.24%	-8.83%
SAIL	39 Underperform	$12.02B	-18.43	-10.58%	―	23.38%	-30.16%

Akamai Corporate Events

Akamai Launches AI Inference Cloud with NVIDIA

On October 28, 2025, Akamai Technologies launched the Akamai Inference Cloud, a platform designed to enable AI inferencing at the edge of the internet. This platform, leveraging NVIDIA’s AI infrastructure, aims to transform AI applications by providing low-latency, real-time processing close to users, thus enhancing AI’s decision-making capabilities globally. The launch is expected to significantly impact AI’s scalability and performance, offering benefits like instant financial insights, real-time decision-making, and enhanced physical AI operations. Akamai Inference Cloud is initially available in 20 global locations, with plans for further expansion.

Akamai Adopts New Bylaws Lowering Voting Threshold

On September 10, 2025, Akamai Technologies’ board of directors adopted new bylaws that lower the voting threshold for stockholders to remove directors and amend bylaws. These changes, effective immediately, reduce the threshold from two-thirds to a majority, potentially increasing shareholder influence and flexibility in corporate governance.