FSLY Stock is Slipping: Can a Steady Enterprise Base Hold the Stock?

Fastly FSLY delivers edge cloud infrastructure designed to serve, secure and accelerate digital experiences. With enterprise customers accounting for more than 90% of total revenues, future performance depends on Fastly’s ability to expand adoption across its platform and maintain steady customer engagement. As more companies prioritize secure, high-performance delivery, sustained traction among large clients remains central to growth.

Fastly’s enterprise metrics remained stable in the first quarter. The Zacks Consensus estimate for enterprise customer count is pegged at 600 for the second quarter, up from 595 in the previous quarter. The consensus mark for enterprise revenues is pegged at $135 million, indicating 11.6% year-over-year growth.,The consensus mark for net retention is pegged at 100.46% much lower than 109.6% reported in the year-ago quarter.. 

A growing product suite and ecosystem integration is expected to drive platform growth. Fastly is extending its edge capabilities with AI powered bot detection, PCI compliant client-side protection and real-time cache APIs. These tools are designed to support secure, high-speed delivery for performance-sensitive workloads. Partnerships and deeper adoption across accounts like Alphabet, VMware, Shopify, Azure and AWS may help support longer-term engagement.

Fastly guided second-quarter revenues between $143 million and $147 million. The Zacks Consensus Estimate for revenues is pegged at $145.07 million suggesting 9.59% year-over-year growth.

Fastly Faces Stiff Competition

Fastly faces stiff competition from Cloudflare NET and Akamai AKAM, both of which offer overlapping solutions in edge delivery and web security. 

Cloudflare continues to expand its programmable edge platform with integrated developer tools and bot protection, directly challenging Fastly’s core offerings. Meanwhile, Akamai is strengthening its position in cloud security and compute through acquisitions and a deeper enterprise focus. Both Cloudflare and Akamai are investing in edge innovation at scale. Fastly’s ability to differentiate on performance and ease of use will be key as it competes for enterprise workloads in a crowded, rapidly evolving market.

FSLY’s Share Price Performance, Valuation and Estimates

FSLY shares have declined 28.9% year to date, while the broader Zacks Computer & Technology sector has increased 7.5% and the Zacks  Internet Software industry has appreciated 14.1%.

FSLY Performance

Fastly shares are currently trading with a forward 12-month price-to-sales (P/S) of 1.58X compared with the industry’s 5.72X. FSLY has a Value Score of F.

FSLY Valuation

The Zacks Consensus Estimate for FSLY’s 2025 loss is pegged at 9 cents per share, unchanged over the past 30 days.Fastly reported loss of 12 cents per share in the year-ago quarter.

Fastly, Inc. Price and Consensus

Fastly, Inc. price-consensus-chart | Fastly, Inc. Quote

FSLY currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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