Akamai Technologies — Third Quarter 2026 Earnings Summary

Financial Performance

• Third quarter revenue was $1.122 billion, a 6% increase year-over-year (up 7% adjusted for foreign exchange) compared to $1.055 billion in Q3 2025.
• GAAP net income was $117 million, a 16% decrease from Q3 2025; GAAP net income per diluted share was $0.77, down 21% year-over-year.
• Non-GAAP net income was $262 million, down 3% from Q3 2025; non-GAAP net income per diluted share was $1.77, down 5% year-over-year.
• GAAP income from operations was $109 million, a 35% decrease from Q3 2025, with a GAAP operating margin of 10% (down 6 percentage points).
• Non-GAAP income from operations was $286 million, an 11% decrease from Q3 2025, with a non-GAAP operating margin of 25% (down 6 percentage points).
• Adjusted EBITDA was $435 million, a 5% decrease from Q3 2025.
• Cash from operations for the quarter was $433 million, representing 39% of revenue.
• Cash, cash equivalents, and marketable securities totaled $4.239 billion as of September 30, 2026.
• Total capital expenditures for the quarter were $464 million, representing 41% of revenue.

Guidance and Future Outlook

• Full year 2026 revenue guidance is $4.440 billion to $4.465 billion.
• Full year 2026 non-GAAP net income per diluted share guidance is $6.47 to $6.68.
• Full year 2026 non-GAAP operating margin guidance is 25%.
• 2027 total company revenue growth is projected to be 17% to 22% year-over-year when adjusted for foreign exchange.
• 2027 Cloud Infrastructure Services revenue is projected to be $1.1 billion to $1.3 billion.
• 2028 total company revenue is projected to exceed $7.0 billion.

Business Segments and Product Lines

• Security revenue was $622 million, up 9% year-over-year (up 10% adjusted for foreign exchange).
• Cloud Infrastructure Services (CIS) revenue was $109 million, up 34% year-over-year (up 35% adjusted for foreign exchange).
• Delivery and other cloud applications revenue was $391 million, down 3% year-over-year.
• U.S. revenue was $559 million, up 5% year-over-year.
• International revenue was $563 million, up 7% year-over-year (up 9% adjusted for foreign exchange).
• Management reported more than $14 billion worth of multi-year commitments signed in CIS during the year.
• New product launches include Akamai Inference and Akamai Agent Sandbox, enabling enterprises to build open-weight models and run agents on the AI-optimized cloud platform.

Market and Competitive Landscape

• The company cites continued momentum across security and Cloud Infrastructure Services as key drivers.
• Management notes a track record of execution and a continued strong pipeline supporting future growth expectations.

Risks and Challenges

• GAAP and non-GAAP operating margins decreased year-over-year due to increased costs and expenses.
• Non-GAAP guidance cannot be reconciled to GAAP measures without unreasonable effort due to the unpredictability of stock-based compensation, amortization of intangible assets, acquisition-related costs, restructuring costs, and tax effects.
• Forward-looking statements cite risks including inability to generate cash at prior levels, failure of innovation investments to gain market acceptance, competition from established and emerging AI infrastructure providers, macroeconomic trends, geopolitical instability, supply chain disruptions, and risks associated with large customer commitments.

Management Commentary and Tone

• CEO Dr. Tom Leighton described the results as "solid," driven by momentum in security and CIS.
• Management expressed excitement regarding "exceptional progress" in Cloud Infrastructure Services and the expansion of the cloud portfolio.
• Management expects overall revenue growth to accelerate in 2027 and further in 2028.

Other Key Points

• The Company spent $616 million during the nine months ended September 30, 2026, to repurchase 5 million shares of common stock at a weighted average price of $123.19 per share.
• No shares were repurchased during the third quarter of 2026.
• The Company had 144 million shares of common stock outstanding as of September 30, 2026.
• The Company issued convertible senior notes, resulting in $3.45 billion in proceeds net of issuance costs for the nine months ended September 30, 2026.
• Number of employees was 11,832 as of September 30, 2026.
• Deferred revenue increased to $198.9 million (current) and $21.1 million (non-current) as of September 30, 2026, compared to $151.2 million and $17.1 million respectively in December 2025.
• Convertible senior notes increased to $7.57 billion in total liabilities (current and non-current) as of September 30, 2026, compared to $4.1 billion in December 2025.