Akamai Technologies

At the Goldman Sachs conference Akamai announced it is transforming from a pure CDN provider into a distributed cloud-compute platform for AI workloads, citing strong demand and more than $2.8 billion in multi-year contracts. The company expects cloud infrastructure growth to accelerate from the current 6–7% into double digits by 2025, and sees near-term bottlenecks mainly in colocation space and power, not capital. GPUs are already deployed at more than 20 sites; revenue targets imply megawatt yields of $15–30 million depending on workload and operating margins in the mid-20s to 30s percent range for large deals. The security business is benefiting simultaneously from AI-driven threats and cross-selling, while Akamai highlights its balance sheet and investment-grade rating as financing advantages. » More on de.investing.com

At the Citi TMT Conference Akamai announced plans to expand its CIS business (Compute, Intelligence, Security) and accelerate growth from the mid-single digits to the low double-digit percentage range. The backlog for edge computing totals $2.8 billion, including a $1.8 billion contract, with gross margins in the mid-60s to 70% and attractive operating margins. The company is investing in capacity for edge AI inference, expects a near-term decline in operating margins of about 5 percentage points, but anticipates that revenue and earnings growth will more than offset this midterm. Akamai emphasizes its network advantages for latency‑sensitive AI applications and is prioritizing capital allocation to compute infrastructure over buybacks. » More on de.investing.com

Akamai posted Q2 revenue of $1.1 billion, non-GAAP EPS $1.59, with security revenue up 10% and cloud infrastructure services surging 39% while legacy delivery fell 6%. Management reported a multi-year cloud commitment worth over $600 million for robotics workloads, said GPU capacity is sold out, and noted total multi-year cloud commitments signed year-to-date exceed $2.8 billion. Full-year revenue guidance was set at $4.445–4.530 billion and capex is expected near 40% of revenue to support scaling, prompting analyst concern over margin compression and an HSBC downgrade to Hold. » More on finance.yahoo.com