Fastly Posts Narrower Loss in Q2 Earnings, Revenues Rise Y/Y

Fastly FSLY reported second-quarter 2025 non-GAAP loss of 3 cents per share, beating the Zacks Consensus Estimate by 40%. The figure was narrower than the company’s year-ago quarter loss of 6 cents per share.

Revenues increased 12.3% year over year to $148.7 million, surpassing the Zacks Consensus Estimate by 2.51%. 

FSLY shares rose 10.6% in pre-market trading. Year to date, Fastly shares plunged 30.9% underperforming the broader Zacks Computer and Technology sector’s return of 11%.

FSLY’s Quarter Details

In second-quarter 2025, Network services revenues increased 10% year over year to $114.9 million. Security revenues climbed 15% year over year to $29.3 million. 
 

Fastly, Inc. Price, Consensus and EPS Surprise

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

Enterprise customer count was 622 in the second quarter, up 21 from the year-ago quarter. The top 10 customers accounted for 31% of revenues in the second quarter compared to 34% in the year-ago quarter. Revenues from the top 10 increased 2% year over year, while revenues from customers other than the top 10 increased 17% year over year.

The non-GAAP gross margin was 59%, contracting 40 basis points (bps) year over year.

Research and development expenses increased 12.3% year over year to $30.5 million. General and administrative expenses increased 9.6% year over year to $21.2 million. Sales and marketing expenses decreased 6.8% year over year to $40.6 million. 

Adjusted EBITDA margin expanded 450 bps year over year to 6% in the reported quarter.

Fastly reported non-GAAP operating loss of $4.6 million, narrower than the $11.5 million loss reported in the year-ago quarter.

FSLY’s Balance Sheet Details

As of June 30, 2025, cash and cash equivalents were $1.07 billion compared with $924.7 million as of March 31.

Fastly Issues Q3 and 2025 Guidance

Fastly expects third-quarter 2025 revenues between $149 million and $153 million. The Zacks Consensus Estimate for revenues is currently pegged at $148.1 million, indicating 7.9% growth from the year-ago reported quarter.

Non-GAAP operating income is expected between a loss of $1 million and earnings of $3 million. The bottom line is expected between a loss of 2 cents and earnings of 2 cents per share for the third quarter. The consensus mark for third-quarter 2025 loss is pegged at 1 cent per share.

For 2025, Fastly expects revenues between $594 million and $602 million. The Zacks Consensus Estimate for revenues is currently pegged at $590.5 million, indicating 8.6% growth from 2024.

Non-GAAP operating income is expected between a loss of $9 million and $3 million. The bottom line is expected between a loss of 10 cents and 4 cents per share for 2025. The consensus mark for 2025 loss is pegged at 9 cents per share.

Zacks Rank & Stocks to Consider

Fastly currently carries a Zacks Rank #3 (Hold).

OptimizeRx OPRX, StoneCo STNE and Vipshop VIPS are some stocks worth considering in the broader Zacks Computer and Technology sector. Each of the three stocks currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

OptimizeRx shares have jumped 156.8% year to date. OptimizeRx is set to report its second-quarter 2025 results on Aug. 7.

StoneCo shares have appreciated 68.2% year to date. StoneCo is set to report its second-quarter 2025 results on Aug. 7.

Vipshop shares are up 13.1% year to date. Vipshop is set to report its second-quarter 2025 results on Aug. 14.

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

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