Akamai Q4 Earnings Beat Estimates, Revenues Increase Y/Y

Akamai Technologies, Inc. AKAM reported strong fourth-quarter 2025 results, with adjusted earnings and revenues beating the Zacks Consensus Estimate.

The company reported year-over-year revenue growth, supported by solid demand across several end markets. Growth was mainly driven by strong adoption of the Guardicore Segmentation platform, increasing demand for API security offerings, and continued traction for zero-trust solutions with solid momentum in cloud infrastructure services.

Net Income

GAAP net income declined to $85.1 million or 58 cents per share from $139.9 million or 91 cents per share in the year-ago quarter. Despite top-line growth, higher cost and operating expenses impacted the bottom line.

Non-GAAP net income was $270.1 million or $1.84 per share compared with $253.9 million or $1.66 per share a year ago. The bottom line beat the Zacks Consensus Estimate by 9 cents.

For 2025, Akamai reported net income of $452 million or $3.07 per share compared with $504.9 million or $3.27 per share in 2024. Non-GAAP net income for 2025 was $1.05 billion or $7.12 per share compared with $995.6 million or $6.48 per share in 2024.

Akamai Technologies, Inc. Price, Consensus and EPS Surprise

Akamai Technologies, Inc. price-consensus-eps-surprise-chart | Akamai Technologies, Inc. Quote

Revenues

Quarterly net sales were $1.09 billion compared with $1.02 billion reported in the year-ago quarter. The 7% year-over-year growth was driven by solid momentum in the Security and Compute segments. Revenues surpassed the Zacks Consensus Estimate of $1.08 billion. For 2025, revenues increased to $4.2 billion from $4 billion in 2024.

By product groups, revenues from the Security Technology Group were $592.4 million compared with $534.6 million in the year-ago quarter. The 11% year-over-year growth was primarily driven by strong demand for Guardicore Segmentation and solid traction in API security solutions. Segment revenues beat our estimate of $589.6 million.

The Delivery segment contributed $311.1 million, down from $317.8 million in the year-ago quarter. However, the segment’s revenues surpassed our estimate of $292.4 million.

The Cloud Computing segment registered $191.4 million in revenues, up from $167.5 million in the prior-year quarter. The growth was driven by increased adoption of cloud infrastructure offerings. The segment’s revenues missed our estimate of $195.3 million.

Region-wise, net sales from the United States came in at $552.9 million, up 4% year over year. International revenues totaled $542.1 million, up from $490.1 million in the year-earlier quarter.

Other Details

In the December quarter, total operating expenses increased to $1 billion from $871.9 million reported in the prior-year period. Non-GAAP income from operations improved to $316 million compared with $298.1 million in the year-ago period. Adjusted EBITDA was $457.5 million, up from $429.4 million in the year-ago quarter.

Cash Flow & Liquidity

In the fourth quarter, Akamai generated $366.6 million in cash from operations compared with $343.8 million in the year-earlier quarter. For 2025, the company generated $1.5 billion of cash from operating activities, almost matching the prior year's figure.

As of Dec. 31, 2025, it had $930.2 million in cash and cash equivalents with $336.6 million of operating lease liabilities, with respective tallies of $517.7 million and $259.1 million a year ago.

Outlook

For the first quarter of 2026, Akamai expects revenues in the range of $1.06 billion to $1.085 billion. Non-GAAP operating margin is projected to be in the band of 26-27%. Non-GAAP earnings are forecasted to be in the range of $1.50-$1.67 per share. Non-GAAP tax rate is anticipated to be 19%.

For 2026, Akamai expects revenues to be between of $4.4 billion and $4.55 billion. It expects a non-GAAP operating margin of 26-28%. Non-GAAP earnings are now projected to be in the range of $6.20-$7.20 per share.

AKAM’s Zacks Rank

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

Stocks to Consider

Celestica Inc. CLS sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

In the last reported quarter, it delivered an earnings surprise of 8.62%. With rising demand for AI and cloud infrastructure, Celestica is well-positioned to benefit. Its focus on higher-margin markets, diversified portfolio, and strong engineering capabilities support scalable production of complex electronic and data-center solutions. Its strong research and development capabilities enable it to produce high-volume electronics manufacturing across multiple industries.

Ericsson ERIC carries a Zacks Rank #2 (Buy) at present. It delivered an earnings surprise of 17.39% in the last reported quarter.

Ericsson is likely to gain from steady global 5G investments. Its competitive 5G portfolio and disciplined cost focus support network leadership, while expanding enterprise and private-network offerings create new growth opportunities. The company continues to execute its plan to become a leading mobile infrastructure provider. Ongoing innovation and partnerships should further strengthen its position in the wireless infrastructure market.

Ubiquiti Inc. UI currently holds a Zacks Rank #2. It delivered an earnings surprise of 38.08% in the last reported quarter.

It offers a broad portfolio of networking solutions for enterprises and service providers. Its efficient and flexible business model supports healthy margins and scalable expansion. The company continues to invest in research and development to launch innovative networking products and advanced technologies. Strong channel management and a wide global distributor network improve demand visibility and inventory control.

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

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