In the CDN cloud world, Akamai remains barely challenged by the rest of the sector when it comes to the raw numbers. They turned in another strong quarter yesterday after the markets closed, shrugging aside the perrenial worries about Apple or another big customer moving traffic off onto internal infrastructure. But it's hard work staying on top and fourth quarter guidance wasn't as big as hoped, so the stock seems to be slumping anyway.
Revenues of $498M were $7M above consensus estimates and ahead of their guidance, boosted by higher than projected traffic in their media segment but with growth across all segments and geographies. Meanwhile non-GAAP adjusted earnings per share of $0.62 were four cents above the top of guidance and a full nickel more than analysts had been looking for. That figure included an extra $0.02 one time tax benefit.
Looking ahead to the usual big Q4, however, Akamai offered cautious revenue guidance of $515-535M and non-GAAP earnings per share of $0.61-66. While those ranges straddle analyst projections of $531M and $0.62, the midpoints are clearly lower. Some of that had to do with expected foreign exchange headwinds of as much as $6M sequentially, and some from just general macro-economic caution.
Akamai is sitting on some $1.6B in cash these days. When the great cloud consolidation wave gets started, I have to wonder if Akamai might play a big part. They haven't been interested in the fiber side of infrastructure, but could be more acquisitive in more general cloud services should the opportunity arise.
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