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Fastly's Network Services Growth Accelerates: More Upside Ahead?
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Key Takeaways
Fastly's Network services drove ~76% of 2025 revenue, with Q4 up 19% year over year.
FSLY growth is fueled by higher traffic, streaming demand, and a consumption-based pricing model.
FSLY faces pressure as Cloudflare and Akamai expand security, cloud, and AI-driven services.
Fastly (FSLY - Free Report) is benefiting from strong Network services growth, which contributed 76.6% to revenues in 2025. In the fourth quarter of 2025, Fastly reported Network services revenues of $130.8 million, which grew 19% year over year and accounted for roughly 75.8% of revenues. Network services revenues include solutions designed to improve the performance of websites, apps, APIs and digital media.
A major driver of strong Network Services growth was higher global traffic flowing through Fastly’s edge network. This was supported by stronger-than-expected digital activity during the fourth quarter and amplified by event-driven traffic spikes. It was also aided by sustained growth across streaming platforms, digital media consumption and a wide range of online services.
Since Fastly operates on a consumption-based pricing model, this surge in traffic directly translated into higher network usage and bandwidth consumption, thereby driving revenue growth, making it a fundamentally volume-driven growth engine. However, this reflects a level of variability, as such traffic patterns can fluctuate based on customer activity and peak digital events rather than purely steady demand.
Fastly guides first-quarter 2026 revenues between $168 million and $174 million. For 2026, revenues are pegged in the $700-$720 million range. The Zacks Consensus Estimate for first-quarter and 2026 revenues is pegged at $171.7 million and $711.1 million, respectively, indicating year-over-year growth of 18.86% and 13.95%.
Fastly Faces Stiff Competition
FSLY faces stiff competition from Cloudflare (NET - Free Report) and Akamai (AKAM - Free Report) , both of which offer overlapping solutions in edge delivery and web security.
Cloudflare’s network services growth is being driven by a structural shift in how the Internet is used—moving from human-driven activity to AI- and machine-driven traffic at a massive scale.
Cloudflare is benefiting from an increasing customer base, driven by its robust portfolio of security solutions. Growing momentum among large customers remains a major tailwind for Cloudflare. Aggravated cyberattacks, the hybrid working trend and a zero-trust approach are aiding Cloudflare in winning multiple clients. A continuous focus on client retention, based on high client satisfaction, is driving the dollar-based net retention rate. Cloudflare expects first-quarter 2026 revenues in the $620-$621 million range.
Meanwhile, Akamai is benefiting from solid momentum in the security and computing verticals across multiple end markets. The company’s Connected Cloud platform and Ondat acquisition boost scalable, secure cloud services, enhancing enterprise storage and IT infrastructure. Strong demand for the Guardicore platform, API security solutions and cloud infrastructure services drives growth. With the acquisitions of Neosec and Noname Security, Akamai has accelerated the advancement of its AI-powered API security solution. For the first quarter of 2026, Akamai expects revenues in the range of $1.06-$1.085 billion.
FSLY’s Share Price Performance, Valuation and Estimates
FSLY’s shares have surged 145.7% year to date, while the broader Zacks Computer & Technology sector has increased 8% and the Zacks Internet Software industry has lost 10.2%.
FSLY Performance
Image Source: Zacks Investment Research
Fastly shares are currently trading with a forward 12-month price-to-sales (P/S) of 5.61X compared with the industry’s 3.93X. FSLY has a Value Score of F.
FSLY Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for FSLY’s first-quarter earnings is pegged at eight cents per share, unchanged over the past 30 days. Fastly reported a loss of five cents in the year-ago quarter.
View the Zacks #1 Rank List
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Fastly's Network Services Growth Accelerates: More Upside Ahead?
Key Takeaways
Fastly (FSLY - Free Report) is benefiting from strong Network services growth, which contributed 76.6% to revenues in 2025. In the fourth quarter of 2025, Fastly reported Network services revenues of $130.8 million, which grew 19% year over year and accounted for roughly 75.8% of revenues. Network services revenues include solutions designed to improve the performance of websites, apps, APIs and digital media.
A major driver of strong Network Services growth was higher global traffic flowing through Fastly’s edge network. This was supported by stronger-than-expected digital activity during the fourth quarter and amplified by event-driven traffic spikes. It was also aided by sustained growth across streaming platforms, digital media consumption and a wide range of online services.
Since Fastly operates on a consumption-based pricing model, this surge in traffic directly translated into higher network usage and bandwidth consumption, thereby driving revenue growth, making it a fundamentally volume-driven growth engine. However, this reflects a level of variability, as such traffic patterns can fluctuate based on customer activity and peak digital events rather than purely steady demand.
Fastly guides first-quarter 2026 revenues between $168 million and $174 million. For 2026, revenues are pegged in the $700-$720 million range.
The Zacks Consensus Estimate for first-quarter and 2026 revenues is pegged at $171.7 million and $711.1 million, respectively, indicating year-over-year growth of 18.86% and 13.95%.
Fastly Faces Stiff Competition
FSLY faces stiff competition from Cloudflare (NET - Free Report) and Akamai (AKAM - Free Report) , both of which offer overlapping solutions in edge delivery and web security.
Cloudflare’s network services growth is being driven by a structural shift in how the Internet is used—moving from human-driven activity to AI- and machine-driven traffic at a massive scale.
Cloudflare is benefiting from an increasing customer base, driven by its robust portfolio of security solutions. Growing momentum among large customers remains a major tailwind for Cloudflare. Aggravated cyberattacks, the hybrid working trend and a zero-trust approach are aiding Cloudflare in winning multiple clients. A continuous focus on client retention, based on high client satisfaction, is driving the dollar-based net retention rate. Cloudflare expects first-quarter 2026 revenues in the $620-$621 million range.
Meanwhile, Akamai is benefiting from solid momentum in the security and computing verticals across multiple end markets. The company’s Connected Cloud platform and Ondat acquisition boost scalable, secure cloud services, enhancing enterprise storage and IT infrastructure. Strong demand for the Guardicore platform, API security solutions and cloud infrastructure services drives growth. With the acquisitions of Neosec and Noname Security, Akamai has accelerated the advancement of its AI-powered API security solution. For the first quarter of 2026, Akamai expects revenues in the range of $1.06-$1.085 billion.
FSLY’s Share Price Performance, Valuation and Estimates
FSLY’s shares have surged 145.7% year to date, while the broader Zacks Computer & Technology sector has increased 8% and the Zacks Internet Software industry has lost 10.2%.
FSLY Performance
Image Source: Zacks Investment Research
Fastly shares are currently trading with a forward 12-month price-to-sales (P/S) of 5.61X compared with the industry’s 3.93X. FSLY has a Value Score of F.
FSLY Valuation
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for FSLY’s first-quarter earnings is pegged at eight cents per share, unchanged over the past 30 days. Fastly reported a loss of five cents in the year-ago quarter.
Fastly, Inc. Price and Consensus
Fastly, Inc. price-consensus-chart | Fastly, Inc. Quote
FSLY currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.