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Akamai
(NASDAQ:AKAM)
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Rating:61Neutral
Price Target:
$125.00
▲(8.35% Upside)
Action:Reiterated
Date:08/07/26
AKAM’s score is primarily held back by weakening profitability and a materially more leveraged balance sheet, alongside softer free-cash-flow momentum. The earnings call provides a meaningful offset via solid revenue guidance and strong CIS/security momentum supported by large multiyear bookings, but near-term results face heavy CapEx intensity and FX headwinds. Technically, momentum is mixed-to-weak with price below key moving averages and a negative MACD, while valuation is challenged by a high P/E and no stated dividend yield.
Positive Factors
CIS growth and multiyear bookings
Large multiyear Cloud Infrastructure Services commitments (> $2.8B, incl. $600M) create durable multi-year revenue visibility, reduce renewal risk, and de-risk heavy upfront infrastructure spend by improving predictable demand and sign-to-revenue cadence over several quarters.
Negative Factors
Markedly higher leverage
Material increase in debt to ~$9.34B and a ~2.0x debt/equity ratio meaningfully raises financial risk and limits flexibility. Elevated leverage heightens sensitivity to margin or cash-flow setbacks, constrains capital allocation choices, and increases reliance on operating performance to de‑lever.
Read all positive and negative factors
Positive Factors
Negative Factors
CIS growth and multiyear bookings
Large multiyear Cloud Infrastructure Services commitments (> $2.8B, incl. $600M) create durable multi-year revenue visibility, reduce renewal risk, and de-risk heavy upfront infrastructure spend by improving predictable demand and sign-to-revenue cadence over several quarters.
Read all positive factors
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.
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The Fly
The FlyAkamai (AKAM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$16.75B
Dividend YieldN/A
Average Volume (3M)3.67M
Price to Earnings (P/E)38.3
Beta (1Y)0.53
Revenue Growth6.15%
EPS Growth0.30%
CountryUS
Employees11,000
SectorTechnology
Sector Strength88
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)2.84
Shares Outstanding145,385,450
10 Day Avg. Volume3,257,563
30 Day Avg. Volume3,665,532
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 Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$159.67Price Target Upside38.40% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering20
EPS Forecast (FY)6.69
Revenue Forecast (FY)$4.50B
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 makes money primarily by selling subscription- and usage-based cloud services to enterprises, digital platforms, and public-sector customers. Its revenue is largely generated from (1) security solutions, where customers pay for protections ...
Akamai Earnings Call Summary
Earnings Call Date:Aug 06, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 10, 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
115.37
Price Trends
125.86
Negative
121.64
Negative
106.25
Positive
Market Momentum
-2.05
Negative
40.36
Neutral
57.02
Neutral
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 115.37 is below the 20-day moving average (MA) of 118.44, below the 50-day MA of 125.86, and above the 200-day MA of 106.25, indicating a neutral trend. The MACD of -2.05 indicates Negative momentum. The RSI at 40.36 is Neutral, neither overbought nor oversold. The STOCH value of 57.02 is Neutral, 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 |
|---|---|---|---|---|---|---|---|
78 Outperform | $118.82B | 56.63 | 187.95% | ― | 18.77% | 12.93% | |
75 Outperform | $194.34B | -4,018.11 | -0.58% | ― | 23.17% | 73.57% | |
68 Neutral | $24.45B | -315.00 | -3.71% | ― | 24.61% | -91.58% | |
68 Neutral | $99.07B | -1,122.43 | -6.23% | ― | 31.55% | -4.50% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
61 Neutral | $16.75B | 38.27 | 9.12% | ― | 6.15% | 0.30% | |
57 Neutral | $9.51B | -62.11 | -2.30% | ― | 23.96% | 78.71% |
* Technology Sector Average
AKAM
Akamai
110.54
39.93
56.55%
FTNT
Fortinet
159.64
85.07
114.08%
ZS
Zscaler
168.68
-102.50
-37.80%
CRWD
CrowdStrike Holdings
214.42
107.81
101.13%
NET
Cloudflare
300.27
99.10
49.26%
SAIL
SailPoint, Inc.
18.66
0.32
1.74%
Akamai Corporate Events
Stock BuybackPrivate Placements and Financing
Akamai Completes Major Convertible Notes Offering and Buyback
Positive
May 22, 2026
On May 22, 2026, Akamai Technologies completed a private placement of two tranches of 0.00% Convertible Senior Notes, issuing $1.75 billion of notes due 2030 and $1.75 billion of notes due 2032 to qualified institutional buyers under Rule 144A. Th...
Business Operations and StrategyStock BuybackPrivate Placements and Financing
Akamai Prices $3 Billion Zero-Coupon Convertible Notes Offering
Positive
May 20, 2026
On May 19, 2026, Akamai priced an upsized private offering of $3 billion in 0% convertible senior notes, split evenly between tranches maturing in 2030 and 2032, sold to qualified institutional buyers. The senior unsecured notes carry significant ...
Business Operations and StrategyStock BuybackPrivate Placements and Financing
Akamai Boosts Flexibility with Convertible Notes and Credit Amendments
Positive
May 18, 2026
On May 18, 2026, Akamai Technologies amended its existing credit agreement with a syndicate of lenders led by JPMorgan Chase, temporarily loosening its maximum consolidated leverage ratio to 4.75:1.00 for the fiscal quarters ending June 30 and Sep...
Business Operations and StrategyShareholder Meetings
Akamai Shareholders Approve Equity Plans and Governance Changes
Positive
May 13, 2026
At its May 13, 2026 annual meeting, Akamai stockholders approved a new 2026 Employee Stock Purchase Plan and an amendment to the 2013 Stock Incentive Plan that adds 8 million shares, reinforcing the company’s ability to attract and retain ta...
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.