Akamai Technologies — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total 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.
• 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.
• GAAP income from operations was $109 million (10% margin), a 35% decrease from Q3 2025.
• Non-GAAP income from operations was $286 million (25% margin), an 11% decrease from Q3 2025.
• GAAP net income was $117 million, a 16% decrease from Q3 2025.
• Non-GAAP net income was $262 million, down 3% from Q3 2025.
• GAAP net income per diluted share was $0.77, down 21% year-over-year (down 15% adjusted for foreign exchange).
• Non-GAAP net income per diluted share was $1.77, down 5% year-over-year (down 2% adjusted for foreign exchange).
• Adjusted EBITDA was $435 million, a 5% decrease from Q3 2025.
• Cash from operations was $433 million, representing 39% of revenue.
• Cash, cash equivalents, and marketable securities totaled $4.239 billion as of September 30, 2026.
• Capital expenditures were $464 million (accrual basis), representing 41% of revenue for the quarter.

Guidance and Future Outlook:

• Full year 2026 revenue guidance is $4.440 billion to $4.465 billion.
• Full year 2026 non-GAAP operating margin guidance is 25%.
• Full year 2026 non-GAAP net income per diluted share guidance is $6.47 to $6.68.
• Full year 2026 non-GAAP tax rate guidance is 18.5%.
• Q4 2026 revenue guidance is $1.145 billion to $1.170 billion.
• Q4 2026 non-GAAP operating margin guidance is 24%.
• Q4 2026 non-GAAP net income per diluted share guidance is $1.50 to $1.70.
• Q4 2026 non-GAAP tax rate guidance is 18%.
• 2027 total company revenue growth is projected to be 17% to 22% year-over-year (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:

• Cloud Infrastructure Services (CIS) is highlighted as a primary growth area with more than $14 billion in multi-year commitments signed in 2026.
• New product launches include Akamai Inference and Akamai Agent Sandbox, enabling enterprises to build and tune open-weight models and run agents on the AI-optimized cloud platform.
• Revenue by geography: 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).
• The company began reporting CIS revenue separately in Q1 2026, with prior periods recast to reflect this change.

Market and Competitive Landscape:

• Management cites continued momentum across security and CIS as drivers for solid results.
• The company positions itself as the cloud company powering and protecting an AI-driven world, extending high-performance computing from the core to the edge.
• Risks mentioned include competition from established and emerging providers of AI infrastructure and cloud computing services, pricing pressure, and changing business models.

Risks and Challenges:

• Financial results are impacted by fluctuations in foreign currency exchange rates.
• 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 note risks including inability to generate cash at prior levels, failure of innovation to gain market acceptance, inability to increase revenue faster than expenses, macroeconomic trends, geopolitical instability, supply chain disruptions, and risks associated with large customer commitments.

Management Commentary and Tone:

• Dr. Tom Leighton, CEO, described the results as "solid," driven by momentum in security and CIS.
• Management expressed excitement regarding the "exceptional progress" in CIS and the strong pipeline.
• The tone indicates confidence in accelerating overall revenue growth in 2027 and 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 in 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 proceeds of $3.452 billion net of issuance costs and warrants during the nine months ended September 30, 2026.
• The number of employees was 11,832 as of September 30, 2026.
• Deferred revenue increased to $220 million ($198.9 million current + $21.1 million non-current) as of September 30, 2026, from $168 million ($151.2 million current + $17.1 million non-current) as of December 31, 2025.
• Convertible senior notes increased to $7.57 billion ($1.15 billion current + $6.42 billion non-current) as of September 30, 2026, compared to $4.11 billion non-current as of December 31, 2025.