Akamai Accelerates, Streamlines

February 7th, 2018 by · Leave a Comment

Akamai reported its Q4 numbers yesterday after the market closed, and the markets are liking what they see. But in addition to beating estimates, they revealed some layoff plans aimed at their Media division.

Revenues of $663M were up 8% over the same quarter last year and above analysts estimates. Earnings per share checked in at $0.69 excluding one time items, which was $0.06 better than expected. For next quarter they expect revenues of $647-659M and earnings per share of $0.67-0.70.

Their Enterprise and Carrier Division saw 24$ growth, their Web Division saw 17% growth over last year, while their Media Division fell 3% when compared to Q4/2016. They saw 1% growth in the US, while international growth was 21% overall. Some of those numbers came from currency fluctuations, but not all.

They also recorded a $52M restructuring charge that covered workforce reductions, facility closures, and capitalized software investments. Some 400 people have been or are being laid off across the company, focused on the Media division. That’s where they’ve seen large web-scale customers moving traffic to in-house CDNs, and efforts to stem that tide haven’t panned out. So they are shutting down some of those efforts and reinvesting the areas they are seeing growth in.

There have been reports that Akamai might be considering strategic alternatives, but they (understandably) refused to comment on the subject on their call.

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Categories: Content Distribution · Financials

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