Fastly (FSLY) AI Stock Analysis

• Market Cap: $3.73B
• Dividend Yield: N/A
• Average Volume (3M): 16.25M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.16
• Revenue Growth: 9.45%
• EPS Growth: 11.76%
• Country: US
• Employees: 1,100
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 0.12
• Shares Outstanding: 151,800,000
• 10 Day Avg. Volume: 12,982,247
• 30 Day Avg. Volume: 16,250,241
• PEG Ratio: 0.45
• Price to Book (P/B): 1.61
• Price to Sales (P/S): 2.40
• P/FCF Ratio: 22.74
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 5.94
• Enterprise Value/Gross Profit: 10.56
• Enterprise Value/Ebitda: -262.24
• 1Y Price Target: $15.00
• Price Target Upside: -38.97% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): 0.27
• Revenue Forecast (FY): $706.64M

• Rating: 72 Outperform
• Price Target: $27.00 ▲(9.85% Upside)
• Action: Reiterated Date: 03/12/26
• Date: Action: Reiterated 03/12/26

The score is driven primarily by improving fundamentals (positive and growing free cash flow, reduced leverage) and a strong earnings-call outlook with upbeat 2026 growth and profitability guidance. Offsetting factors are stretched technical conditions (overbought signals) and weaker traditional valuation support due to a negative P/E and no dividend yield.

Positive Factors

Free Cash Flow Strength

Sustained positive operating and free cash flow materially reduces dependence on external financing and supports reinvestment. Durable FCF enables Fastly to fund infrastructure spend, product development and optionality on M&A or debt reduction without eroding liquidity over the next 2–6 months.

Improved Leverage and Balance Sheet

Material deleveraging meaningfully lowers financial risk and increases flexibility to invest in capacity or weather demand variability. A stronger balance sheet reduces refinancing pressure and gives management runway to execute strategic initiatives over the medium term.

Product Momentum & Contracted Backlog

Rapid growth in security and edge compute, high net retention and a sizable RPO backlog indicate expanding multi-product adoption and stronger revenue visibility. These structural trends diversify revenue beyond CDN and support sustainable customer expansion and margin improvement.

Negative Factors

Ongoing Unprofitability

Despite margin improvement, persistent negative operating and net margins constrain return generation and limit the company’s ability to compound shareholder value. Continued GAAP losses raise the bar for execution and require sustained revenue/margin momentum to reach durable profitability.

Consumption-Driven Revenue Volatility

Revenue tied to traffic and usage increases short-term volatility and complicates forecasting and capacity planning. Over the medium term this variability can magnify earnings swings, stress margins in weaker demand periods, and make booking durable predictable growth harder.

Rising CapEx and Component Costs

A meaningful step-up in infrastructure spending and supply-cost pressure raises capital intensity and can compress free cash flow and margins if revenue growth slows. Higher and front-loaded CapEx increases execution risk and short-term sensitivity to component price swings.

Fastly Business Overview & Revenue Model

Company Description

Fastly, Inc. operates an edge cloud platform for processing, serving, and securing its customer's applications in the United States, the Asia Pacific, Europe, and internationally. The edge cloud is a category of Infrastructure as a Service that enables developers to build, secure, and deliver digital experiences at the edge of the internet. It is a programmable platform designed for web and application delivery. The company offers Compute@Edge; developer hub that includes solution library patterns and recipes, API and language references, change logs, and Fastly Fiddle solutions; device detection and geolocation, edge dictionaries, edge access control lists, and edge authentication services; full site delivery services, such as dynamic site acceleration, origin shield, instant purge, surrogate keys, real-time logging and stats, cloud optimizer, programmatic control, edge databases, content compression, reliability, and modern protocols and performance services; and streaming solutions and services, including live streaming, media shield, and origin connect. It also provides edge security solutions, such as DDoS protection and cloud, edge web application firewall (WAF), transport layer security (TLS), platform TLS, and compliance services; unified web application and API protection solutions that includes runtime self-application protection, advanced rate limiting, API and ATO protection, account takeover protection, bot protection, and next generation WAF. In addition, the company offers edge applications, such as load balancers and image optimizers; video on demand; and managed edge delivery services. It serves customers operating in digital publishing, media and entertainment, technology, online retail, travel and hospitality, and financial services industries. The company was formerly known as SkyCache, Inc. and changed its name to Fastly, Inc. in May 2012. Fastly, Inc. was incorporated in 2011 and is headquartered in San Francisco, California.

How the Company Makes Money

Fastly primarily makes money by selling subscriptions/usage-based access to its edge cloud platform, where customers pay to deliver and secure internet traffic over Fastly’s network. Revenue is largely driven by (1) network services such as content delivery (CDN) and dynamic site acceleration, typically metered based on delivered bandwidth/requests and related usage; (2) security services (e.g., web application firewall, bot mitigation, DDoS protection, and related web/application security capabilities), commonly sold as add-on products that may be priced via a mix of subscription commitments and usage/traffic-based measures; and (3) edge compute services (Compute@Edge), where customers deploy and run applications closer to end users and pay based on consumption (e.g., requests, compute execution, and associated platform usage). Fastly’s model often involves customer contracts that include committed spend (minimums) with variable overage based on actual traffic and feature consumption; this ties revenue to customers’ web/app usage volumes and the breadth of products adopted. Significant factors influencing earnings include customer traffic growth (higher delivery and request volumes), product attach/upsell into security and compute, customer retention/expansion within large digital-native and enterprise accounts, and the overall utilization and efficiency of Fastly’s global edge network. Specific partnerships that materially contribute to earnings: null.

Fastly Financial Statement Overview

Summary

Financials are improving meaningfully: positive TTM operating cash flow (~$94M) and free cash flow (~$61M) with strong FCF growth, and leverage has fallen sharply (debt-to-equity ~0.12). The main constraint is still profitability quality—income statement remains pressured by ongoing losses and only modest TTM revenue growth (5.4%), despite margin improvement.

Income Statement

TTM (Trailing-Twelve-Months) revenue grew 5.4% and gross margin improved to ~56% (up from ~54% in 2024), indicating decent pricing/premiums and/or cost discipline. Losses are narrowing meaningfully: EBIT margin improved to about -15% (from ~-28% in 2024) and net margin improved to about -19% (from ~-29%). The key weakness remains ongoing unprofitability (negative EBIT/EBITDA and net income), and revenue growth has decelerated sharply versus earlier years, limiting operating leverage.

Balance Sheet

Leverage improved materially: debt-to-equity fell to ~0.12 in TTM (Trailing-Twelve-Months) from ~0.42 in 2024 and ~0.87 in 2022, which lowers financial risk and increases flexibility. Equity remains substantial (~$930M) relative to total assets (~$1.50B). The main concern is that returns on equity are still negative (about -13% TTM), reflecting continued losses and limiting the balance sheet’s ability to compound value without sustained earnings improvement.

Cash Flow

Cash generation has turned into a clear strength: TTM (Trailing-Twelve-Months) operating cash flow was ~$94M and free cash flow was ~$61M, with very strong free-cash-flow growth (~40%). This is a major improvement from 2023–2024 when free cash flow was negative. A remaining watch item is that accounting losses persist, and cash flow strength will need to prove durable through different demand environments.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	624.02M	543.68M	505.99M	432.73M	354.33M
Gross Profit	356.20M	295.94M	266.33M	209.78M	187.33M
EBITDA	-9.27M	-79.07M	-19.01M	-120.48M	-167.35M
Net Income	-121.68M	-158.06M	-133.09M	-190.77M	-222.70M
Balance Sheet
Total Assets	1.50B	1.45B	1.53B	1.90B	2.16B
Cash, Cash Equivalents and Short-Term Investments	361.76M	295.88M	322.72M	517.97M	527.86M
Total Debt	430.19M	404.66M	433.32M	833.54M	1.05B
Total Liabilities	569.90M	486.11M	545.70M	940.96M	1.15B
Stockholders Equity	929.58M	965.25M	979.49M	955.16M	1.01B
Cash Flow
Free Cash Flow	65.75M	-20.81M	-31.91M	-149.95M	-88.87M
Operating Cash Flow	94.44M	16.41M	362.00K	-69.63M	-38.48M
Investing Cash Flow	-213.03M	178.90M	294.94M	235.75M	-794.51M
Financing Cash Flow	12.76M	-17.10M	-331.38M	-189.15M	936.55M

Fastly Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 24.58
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FSLY, the sentiment is Positive. The current price of 24.58 is above the 20-day moving average (MA) of 20.06, above the 50-day MA of 13.78, and above the 200-day MA of 9.76, indicating a bullish trend. The MACD of 2.99 indicates Negative momentum. The RSI at 80.17 is Negative, neither overbought nor oversold. The STOCH value of 84.46 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FSLY.

Fastly Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
FSLY	72 Outperform	$3.73B	-12.29	-12.92%	―	9.45%	11.76%
SEMR	67 Neutral	$1.80B	-93.17	-6.73%	―	19.87%	-136.93%
PD	64 Neutral	$600.80M	5.56	77.23%	―	7.01%	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
AMPL	61 Neutral	$982.89M	-17.26	-32.90%	―	12.78%	-20.47%
BLND	48 Neutral	$404.63M	-114.42	-21.34%	―	-15.41%	71.18%

Fastly Corporate Events

Fastly Delivers Record Q4 2025 Results, Achieves Profitability

Fastly reported record fourth-quarter and full-year 2025 results on February 11, 2026, with revenue rising 23% year over year in the quarter to $172.6 million and 15% for the full year to $624.0 million. The company posted record gross margins, sharply narrowed its GAAP net loss, and turned to non-GAAP profitability and positive free cash flow as security and other high-growth offerings outpaced core network services.

Key customer and contract metrics underscored strengthening demand, with remaining performance obligations jumping 55% to $354 million and net retention improving to 110%, while enterprise customer count and top-10 customer concentration both increased. Fastly also bolstered its balance sheet with a convertible notes refinancing and expanded its product portfolio across API security, observability, compute performance and AI-based tools, moves that reinforce its competitive positioning in edge cloud and application security markets.

The most recent analyst rating on (FSLY) stock is a Hold with a $9.00 price target. To see the full list of analyst forecasts on Fastly stock, see the FSLY Stock Forecast page.

Fastly Finalizes $20M Convertible Notes Offering

Fastly, Inc., a provider of cloud-based solutions, announced the issuance of additional $20 million worth of 0% Convertible Senior Notes due 2030, as part of a private offering initially closed on December 9, 2025. On December 17, 2025, the company finalized the sale, resulting in net proceeds of $19.4 million, which will partially be used for privately negotiated capped call transactions aimed at reducing dilution or offsetting cash payments tied to note conversions. These capped call transactions, with a cap price of $23.04 per share, are designed to mitigate potential operational impacts on the company’s equity.

The most recent analyst rating on (FSLY) stock is a Buy with a $14.00 price target. To see the full list of analyst forecasts on Fastly stock, see the FSLY Stock Forecast page.