Akamai (AKAM)
NASDAQ:AKAM
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Akamai
(NASDAQ:AKAM)
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Rating:64Neutral
Price Target:
$158.00
▲(64.77% Upside)
Action:ReiteratedDate:05/09/26
The score is driven primarily by a fundamentally solid but softening financial profile (margin compression, higher leverage, weaker cash conversion) and a constructive earnings outlook centered on accelerating CIS/AI growth and a major $1.8B customer win, partially offset by heavy near-term CapEx and margin pressure. Technical momentum is strong but overextended, and valuation looks expensive at ~39x earnings without dividend support.
Positive Factors
Landmark $1.8B multi-year customer contract
A seven-year $1.8B committed contract materially raises multi-year revenue visibility and underpins long-term capacity planning. It de‑risks investments in infrastructure, creates a predictable revenue stream, and provides a platform for incremental upsells across security and CIS services.
Negative Factors
Elevated leverage reduces financial flexibility
Materially higher leverage constrains balance sheet optionality for M&A, incremental capex, or defensive actions. Increased debt raises interest and refinancing risk, and with margin pressures the company has less room to fund strategic investments from equity or free cash flow over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Landmark $1.8B multi-year customer contract
A seven-year $1.8B committed contract materially raises multi-year revenue visibility and underpins long-term capacity planning. It de‑risks investments in infrastructure, creates a predictable revenue stream, and provides a platform for incremental upsells across security and CIS services.
Read all positive factors
Akamai (AKAM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$21.75B
Dividend YieldN/A
Average Volume (3M)5.19M
Price to Earnings (P/E)39.2
Beta (1Y)0.43
Revenue Growth6.15%
EPS Growth0.30%
CountryUS
Employees10,811
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)3.01
Shares Outstanding147,223,050
10 Day Avg. Volume6,457,575
30 Day Avg. Volume5,193,241
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 Cap1.24
Enterprise Value/Revenue6.33
Enterprise Value/Gross Profit11.05
Enterprise Value/Ebitda23.63
Forecast
1Y Price Target
$148.06Price Target Upside54.40% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering20
EPS Forecast (FY)6.81
Revenue Forecast (FY)$4.48B
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:May 07, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 11, 2026
Earnings Call Sentiment Positive
The quarter highlights a major strategic inflection toward cloud infrastructure and AI inference backed by a landmark $1.8B customer commitment, strong CIS growth (Q1 CIS +40% YoY and FY guide of ≥50%) and continued security momentum (Q1 security +11% YoY) alongside industry recognition and solid liquidity. Offsetting these positives are near-term profitability and cash deployment pressures — higher CapEx (notably ~$700M planned for 2026 for the large deal), increased depreciation and headcount that compressed non-GAAP net income (down 5% YoY), and ongoing declines in the delivery segment. Management expects margins to remain constrained in the near term as it invests to capture what it characterizes as a sizable multi-year AI opportunity, and there is potential for incremental GPU orders beyond current guidance. Overall, the call is constructive about long-term growth and market positioning but candid about short-term investment-related headwinds.Positive Updates
Record Landmark Customer Win
Signed a seven-year $1.8 billion committed contract—the largest customer deal in company history; expected initial revenue contribution of ~$20M–$25M in Q4 2026 and full deployment revenue to ramp thereafter.
Negative Updates
Profitability Pressure from Investments
Non-GAAP net income of $239 million (non-GAAP EPS $1.61) was down 5% year-over-year; results impacted by expanded colocation investments, higher depreciation, and increased headcount tied to CIS investment.
Read all updates
Q1-2026 Updates
Positive
Negative
Record Landmark Customer Win
Signed a seven-year $1.8 billion committed contract—the largest customer deal in company history; expected initial revenue contribution of ~$20M–$25M in Q4 2026 and full deployment revenue to ramp thereafter.
Read all positive updates
Company Guidance
Akamai’s guidance called for Q2 revenue of $1.075–$1.100 billion (up 3%–5% y/y), cash gross margins of ~70%–71%, non‑GAAP operating expenses of $346–$357 million, EBITDA margin of ~38%–39%, non‑GAAP depreciation of $140–$144 million, non‑GAAP operating margin of ~25%–26%, non‑GAAP EPS of $1.45–$1.65 (assuming $47–$54 million of taxes at an ~18.5% non‑GAAP tax rate and ~146 million diluted shares), and Q2 CapEx of $433–$453 million (~40%–41% of revenue); for full‑year 2026 they guided revenue of $4.445–$4.55 billion (up 6%–8% reported, 5%–8% constant currency), at least 50% constant‑currency growth for Cloud Infrastructure Services (CIS), security growth in the high single digits, delivery down mid single digits, a ~26% non‑GAAP operating margin, CapEx of ~40%–42% of revenue (including roughly $700 million of the ~$800–$825 million 12‑month spend to support the $1.8 billion customer), non‑GAAP EPS of $6.40–$7.15 (based on ~18.5% tax and ~147 million shares), FX headwind/benefit assumptions (Q2 ~flat vs Q1, +$2M y/y; FY +$20M), and an expected initial revenue contribution from the $1.8B customer of roughly $20–$25 million in Q4.Akamai Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
56
Neutral
Cash Flow
63
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 4.27B | 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 | 1.14B | 1.34B | 1.26B | 1.24B | 1.26B | 1.35B |
| Net Income | 435.18M | 452.03M | 504.92M | 547.63M | 523.67M | 651.64M |
Balance Sheet | ||||||
| Total Assets | 11.65B | 11.48B | 10.37B | 9.90B | 8.30B | 8.14B |
| Cash, Cash Equivalents and Short-Term Investments | 930.45M | 1.19B | 1.60B | 864.44M | 1.11B | 1.08B |
| Total Debt | 5.87B | 6.91B | 4.63B | 4.54B | 3.17B | 2.86B |
| Total Liabilities | 6.74B | 6.50B | 5.49B | 5.30B | 3.94B | 3.61B |
| Stockholders Equity | 4.91B | 4.98B | 4.88B | 4.60B | 4.36B | 4.53B |
Cash Flow | ||||||
| Free Cash Flow | 764.73M | 699.26M | 833.90M | 618.40M | 816.37M | 859.33M |
| Operating Cash Flow | 1.58B | 1.52B | 1.52B | 1.35B | 1.27B | 1.40B |
| Investing Cash Flow | -1.74B | -540.74M | -798.68M | -1.85B | -622.31M | -646.90M |
| Financing Cash Flow | -327.50M | -588.04M | -679.63M | 443.38M | -634.18M | -562.00M |
Akamai Technical Analysis
Neutral
95.89
Price Trends
104.54
Negative
97.29
Negative
87.39
Positive
Market Momentum
-3.34
Positive
41.42
Neutral
19.99
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AKAM, the sentiment is Neutral. The current price of 95.89 is below the 20-day moving average (MA) of 108.07, below the 50-day MA of 104.54, and above the 200-day MA of 87.39, indicating a neutral trend. The MACD of -3.34 indicates Positive momentum. The RSI at 41.42 is Neutral, neither overbought nor oversold. The STOCH value of 19.99 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral 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 | $84.40B | 28.24 | 155.65% | ― | 15.75% | 6.24% | |
74 Outperform | $133.85B | 720.36 | -4.68% | ― | 21.71% | -908.90% | |
67 Neutral | $24.46B | -232.70 | -3.48% | ― | 23.91% | -326.25% | |
64 Neutral | $21.75B | 39.23 | 9.12% | ― | 6.15% | 0.30% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
59 Neutral | $68.97B | -793.39 | -7.48% | ― | 31.55% | -4.50% | |
49 Neutral | $6.90B | -60.86 | -3.96% | ― | 24.35% | 55.68% |
* 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.