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Will Healthy Revenue Growth Boost Akamai's Q4 Earnings?
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Akamai Technologies, Inc. (AKAM - Free Report) is set to release its fourth-quarter 2024 results on Feb. 20, after the closing bell.
Find the latest earnings estimates and surprises on Zacks Earnings Calendar.
The leading provider of content delivery network and cloud infrastructure services is expected to report top-line growth year over year, driven by solid demand in multiple verticals. Increasing demand for its security solutions is a tailwind. It pulled off a trailing four-quarter earnings surprise of 2.69%, on average.
Factors at Play
During the fourth quarter, Akamai upgraded its industry-leading Akamai Guardicore Segmentation and Enterprise Application Access solution to further improve the performance, security and scalability of cloud environments. The new features are expected to allow organizations to visualize cloud workloads on a real-time basis through an interactive map, giving administrators a clearer view of network flows and application dependencies. This enhanced visibility will bridge the gap between DevOps and SecOps teams, helping businesses govern cloud network security more effectively.
Akamai has made a significant step in the digital content delivery industry by integrating Avesha Technologies into its Qualified Compute Partner Program. This partnership with Avesha is set to bolster Akamai's ability to deliver personalized, high-quality content by leveraging the former's state-of-the-art Kubernetes solutions across Akamai Connected Cloud, the world's most distributed platform for cloud computing, security and content delivery. These initiatives are expected to have boosted Akamai’s top line in the to-be-reported quarter.
In the fourth quarter, Akamai announced that Smartbig USA Inc., a subsidiary of a Korean gaming company, Smartbig, has selected its cloud computing platform, Akamai Connected Cloud, to power its global gaming infrastructure. This strategic partnership underscores Akamai’s commitment to optimizing infrastructure costs while delivering high performance and supporting Smartbig’s growing user base across Asia and beyond. The collaboration also aligns with Akamai’s efforts to expand its international footprint and enhance its ability to meet the needs of global customers.
Akamai has completed the acquisition of select assets of the bankrupt media firm Edgio Inc., including customer contracts from Edgio’s content delivery and security businesses, along with non-exclusive license rights to its patents. The deal is expected to be accretive to Akamai, offering it hundreds of new customers that potentially augment its revenue-generating capabilities.
Overall Expectations
Our estimate for revenues from the security segment is pegged at $537.7 million, suggesting 14.2% year-over-year growth. Our revenue estimate for the compute vertical is pegged at $168.7 million, indicating a 24.9% year-over-year improvement. Revenues from the delivery segment are projected to be $302.3 million.
For the fourth quarter of 2024, the Zacks Consensus Estimate for revenues is pegged at $1.01 billion, indicating year-over-year growth from $995 million. The consensus estimate for adjusted earnings per share is pegged at $1.52, suggesting a decline from the $1.69 reported a year ago.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for Akamai this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00%, with both pegged at $1.52. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Image: Bigstock
Will Healthy Revenue Growth Boost Akamai's Q4 Earnings?
Akamai Technologies, Inc. (AKAM - Free Report) is set to release its fourth-quarter 2024 results on Feb. 20, after the closing bell.
Find the latest earnings estimates and surprises on Zacks Earnings Calendar.
The leading provider of content delivery network and cloud infrastructure services is expected to report top-line growth year over year, driven by solid demand in multiple verticals. Increasing demand for its security solutions is a tailwind. It pulled off a trailing four-quarter earnings surprise of 2.69%, on average.
Factors at Play
During the fourth quarter, Akamai upgraded its industry-leading Akamai Guardicore Segmentation and Enterprise Application Access solution to further improve the performance, security and scalability of cloud environments. The new features are expected to allow organizations to visualize cloud workloads on a real-time basis through an interactive map, giving administrators a clearer view of network flows and application dependencies. This enhanced visibility will bridge the gap between DevOps and SecOps teams, helping businesses govern cloud network security more effectively.
Akamai has made a significant step in the digital content delivery industry by integrating Avesha Technologies into its Qualified Compute Partner Program. This partnership with Avesha is set to bolster Akamai's ability to deliver personalized, high-quality content by leveraging the former's state-of-the-art Kubernetes solutions across Akamai Connected Cloud, the world's most distributed platform for cloud computing, security and content delivery. These initiatives are expected to have boosted Akamai’s top line in the to-be-reported quarter.
In the fourth quarter, Akamai announced that Smartbig USA Inc., a subsidiary of a Korean gaming company, Smartbig, has selected its cloud computing platform, Akamai Connected Cloud, to power its global gaming infrastructure. This strategic partnership underscores Akamai’s commitment to optimizing infrastructure costs while delivering high performance and supporting Smartbig’s growing user base across Asia and beyond. The collaboration also aligns with Akamai’s efforts to expand its international footprint and enhance its ability to meet the needs of global customers.
Akamai has completed the acquisition of select assets of the bankrupt media firm Edgio Inc., including customer contracts from Edgio’s content delivery and security businesses, along with non-exclusive license rights to its patents. The deal is expected to be accretive to Akamai, offering it hundreds of new customers that potentially augment its revenue-generating capabilities.
Overall Expectations
Our estimate for revenues from the security segment is pegged at $537.7 million, suggesting 14.2% year-over-year growth. Our revenue estimate for the compute vertical is pegged at $168.7 million, indicating a 24.9% year-over-year improvement. Revenues from the delivery segment are projected to be $302.3 million.
For the fourth quarter of 2024, the Zacks Consensus Estimate for revenues is pegged at $1.01 billion, indicating year-over-year growth from $995 million. The consensus estimate for adjusted earnings per share is pegged at $1.52, suggesting a decline from the $1.69 reported a year ago.
Earnings Whispers
Our proven model does not conclusively predict an earnings beat for Akamai this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here.
Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is 0.00%, with both pegged at $1.52. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.
Akamai Technologies, Inc. Price and EPS Surprise
Akamai Technologies, Inc. price-eps-surprise | Akamai Technologies, Inc. Quote
Zacks Rank: Akamai currently has a Zacks Rank #2.
Stocks to Consider
Carvana Co. (CVNA - Free Report) is set to release quarterly numbers on Feb. 19. It has an Earnings ESP of +12.43% and sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Walmart Inc. (WMT - Free Report) is set to release quarterly numbers on Feb. 20. It has an Earnings ESP of +2.15% and carries a Zacks Rank #2.
Autohome (ATHM - Free Report) is set to release quarterly numbers on Feb. 20. It has an Earnings ESP of +7.27% and carries a Zacks Rank #2.