Financial Performance - Total revenue for Q1 2025 was $144.5 million, representing an 8% year-over-year growth[9]. - Q2 2023 revenue was $122.831 million, increasing to $144.474 million by Q1 2025, representing a growth of approximately 17.6%[36]. - Gross profit for Q2 2023 was $70.366 million, with a projected increase to $82.853 million by Q1 2025, indicating a growth of about 17.8%[36]. - Gross profit for Q3 2023 was $66.086 million, with an expected increase to $76.798 million by Q1 2025, indicating a growth of about 16.2%[32]. - The company reported a net loss of $(3.779) million in Q2 2023, with a projected loss of $(6.597) million by Q1 2025, indicating a worsening financial position[36]. - Net loss for Q3 2023 was $54.311 million, with a projected decrease to $39.148 million by Q1 2025, indicating an improvement of about 28%[32]. - The company reported a net loss of $54,311 thousand in Q3 2023, an increase from a net loss of $10,704 thousand in Q2 2023[40]. - Non-GAAP operating loss for Q2 2025 is projected to be between $8.0 million and $4.0 million, with a non-GAAP net loss per share between $0.08 and $0.04[5]. Customer Metrics - The enterprise customer count increased to 595, up 18 from Q1 2024, while total customer count decreased to 3,035, down 255 from Q1 2024[9]. - Fastly's top ten customers accounted for 33% of revenue in Q1 2025, down from 38% in Q1 2024[9]. - Last 12-month net retention rate (LTM NRR) decreased to 100% in Q1 2025 from 102% in Q4 2024[9]. Cash Flow and Expenses - The company generated $8.2 million of positive free cash flow in Q1 2025, compared to $2.2 million of negative free cash flow in Q1 2024[9]. - Free cash flow for Q3 2023 was negative at $(19,694) thousand, a decline from $7,753 thousand in Q2 2023[41]. - Total operating expenses in Q2 2023 were $77.311 million, projected to rise to $88.698 million by Q1 2025, an increase of about 14.7%[36]. - Total operating expenses in Q3 2023 were $124.428 million, with a forecasted decrease to $114.977 million by Q1 2025, reflecting a reduction of approximately 7.5%[32]. Research and Development - Research and development expenses in Q3 2023 were $39.068 million, expected to decrease to $37.429 million by Q1 2025, a reduction of approximately 4.2%[32]. - Research and development expenses were $25.216 million in Q2 2023, expected to increase to $28.536 million by Q1 2025, a growth of approximately 13.0%[36]. - Research and development expenses for Q3 2023 were $39,068 thousand, with non-GAAP R&D expenses at $26,236 thousand, highlighting a focus on innovation[33]. Financial Health and Liabilities - Long-term debt decreased from $472,823 thousand in Q3 2023 to $149,874 thousand in Q1 2025, a reduction of about 68.3%[39]. - Total liabilities decreased from $672,091 thousand in Q3 2023 to $492,222 thousand in Q1 2025, reflecting a decrease of approximately 26.7%[39]. - Total current assets decreased from $551,458 thousand in Q3 2023 to $440,195 thousand in Q1 2025, representing a decline of approximately 20.2%[39]. - Total stockholders' equity decreased from $968,572 thousand in Q3 2023 to $957,023 thousand in Q1 2025, a slight decrease of approximately 1.6%[39]. - Accumulated deficit increased from $811,366 thousand in Q3 2023 to $1,031,958 thousand in Q1 2025, indicating a worsening of about 27.1%[39]. Product Development and Recognition - Fastly released several new products, including Fastly Client-Side Protection and Fastly HTTP Cache API, enhancing its service offerings[8]. - Fastly's Next-Gen WAF was recognized as a Strong Performer in The Forrester Wave™: Web Application Firewall Solutions, Q1 2025[9]. - Product package deals in Q1 2025 more than doubled year-over-year, with new logo packages growing over 80% year-over-year[8]. Future Outlook - Future outlook includes continued focus on market expansion and product development, with an emphasis on maintaining cost efficiency and improving margins[33]. - Management emphasizes that non-GAAP financial measures provide a clearer view of the company's core business performance and facilitate comparisons with peers[30]. - The company plans to exclude amortization of capitalized stock-based compensation from non-GAAP financial measures starting Q1 2025, enhancing the clarity of financial performance[34].

Group 1: Radware Overview - Radware (RDWR) shares increased by 5.5% to $22.24, following a strong market recovery amid easing US-China trade tensions [1] - The stock had previously experienced an 8.4% decline over the past four weeks [1] - The upcoming quarterly earnings are expected to be $0.23 per share, reflecting a year-over-year increase of 43.8%, with revenues projected at $70.5 million, up 8.3% from the previous year [2] Group 2: Earnings Estimates and Market Position - The consensus EPS estimate for Radware has remained unchanged over the last 30 days, indicating a lack of upward revisions which typically correlate with stock price movements [3] - Radware holds a Zacks Rank of 3 (Hold), suggesting a neutral outlook [3] - The company is part of the Zacks Internet - Software industry, which includes other players like Fastly (FSLY) [3] Group 3: Fastly Overview - Fastly's consensus EPS estimate for the upcoming report is -$0.06, representing a year-over-year decline of 20% [4] - Fastly currently has a Zacks Rank of 4 (Sell), indicating a negative outlook [4]

Core Viewpoint - Fastly is experiencing significant challenges with revenue growth and customer retention, which raises concerns about its long-term stability, despite potential opportunities in the AI market through new product innovations [12]. Group 1: Stock Performance - Fastly's shares have declined 27.4% year to date, underperforming the broader Zacks Computer & Technology sector's decline of 8% and the Zacks Internet - Software industry's fall of 2.8% [1]. - In comparison, Digital Turbine's shares have surged 98.3%, while Inseego and Atlassian have seen declines of 5.4% and 10.2%, respectively [1]. Group 2: Revenue and Earnings - Fastly reported fourth-quarter 2024 revenues of $140.6 million, reflecting a 2% year-over-year growth, primarily due to stagnant network services revenues [2]. - For the first quarter of 2025, Fastly expects revenues between $136 million and $140 million, indicating a 3% year-over-year growth at the mid-point [5]. - The company anticipates revenues of $575 million to $585 million for 2025, suggesting a 7% year-over-year growth at the mid-point [6]. Group 3: Customer Retention Challenges - Fastly is facing significant customer retention challenges, with a net retention rate falling to 102% in the fourth quarter from 105% the previous quarter and 113% a year ago [4]. - The company lost 182 customers year over year and 577 in the last quarter, indicating ongoing retention issues and potential weaknesses in customer growth [4]. Group 4: Product Innovations - Fastly's fourth-quarter 2024 results highlight significant product innovations, including the AI Accelerator and advanced security solutions, which may enhance its competitive edge in edge computing [8]. - The AI Accelerator addresses performance and cost challenges in LLM and generative AI applications, supporting OpenAI's ChatGPT and Google Gemini, thereby creating revenue opportunities in the growing AI market [9]. - Fastly's new DDoS Protection service enhances its security portfolio by providing automated threat defense, which may drive customer adoption and retention [10]. - The introduction of Object Storage, an S3-compatible solution with zero egress fees, aims to reduce origin costs and enhance performance for data-intensive users, positioning Fastly for accelerated revenue growth [11].

Core Insights - Fastly (FSLY) reported revenue of $140.58 million for the quarter ended December 2024, marking a year-over-year increase of 2% [1] - The company recorded an EPS of -$0.03 for the same period, compared to an EPS of $0.01 a year ago [1] Financial Performance - Revenue for the quarter was $140.58 million, reflecting a slight growth of 2% year-over-year [1] - The earnings per share (EPS) decreased to -$0.03 from $0.01 in the previous year [1]

Financial Performance - Fastly's Last-Twelve Months Net Retention Rate (LTM NRR) metrics measure revenue growth from existing customers due to increased platform usage and additional product purchases[31]. - As of December 31, 2024, the company had cash, cash equivalents, and marketable securities totaling $295.9 million[100]. - Research and development expenses for the year ended December 31, 2024, were $138.0 million[88]. - The company employed 1,100 employees worldwide, with 240 located outside the United States as of December 31, 2024[80]. - The research and development team consisted of 389 employees as of December 31, 2024[88]. - A hypothetical 10% change in interest rates would not have had a material impact on the company's consolidated financial statements[100]. - A hypothetical 10% change in foreign exchange rates would not have had a material impact on the consolidated financial statements[460]. Product and Service Offerings - Fastly's Points of Presence (POPs) are architected with robust customized servers, yielding colocation cost savings compared to traditional architectures[35]. - The company has built a fully programmable platform using Varnish Configuration Language (VCL) and flexible APIs, allowing customers to control content caching and end-user request responses[35]. - Fastly Compute enables app developers to build high-performance, personalized applications without managing underlying infrastructure, enhancing scalability and security[56]. - The Instant Purge feature allows customers to clear cached content globally in milliseconds, improving performance for dynamic content delivery[43]. - Fastly's DDoS Protection offers zero attack fee billing, ensuring customers are not charged for attack traffic while providing robust application layer protection[52]. - Fastly's Origin Shield reduces costs and improves performance by collapsing multiple content requests into a single request during high traffic events[43]. - The Advanced Rate Limiting feature helps customers manage high-volume web requests, ensuring legitimate traffic is prioritized while blocking malicious requests[50]. - Fastly's observability offerings provide real-time insights for continuous performance improvements and faster debugging during development[40]. - Fastly's Compute platform offers features like TLS termination, serverless execution, and data access at the edge, enhancing performance and reducing latency for users[57][58][59]. - Fastly's Managed CDN provides maximum control and flexibility, allowing deployment on dedicated POPs within a customer's private network[63]. - Fastly's professional services include real-time logging and actionable insights to optimize performance and user experience for customers[62]. Strategic Initiatives - The acquisition of Glitch, Inc. in May 2022 expanded Fastly's developer community to over 3.1 million registered developers, supporting learning initiatives and code samples[59]. - The company plans to simplify customer onboarding and service usage, with a focus on a unified platform for managing all Fastly services[65]. - Fastly's growth strategy includes expanding into additional vertical markets and increasing wallet-share from existing customers through new products and features[68]. - The company has established partnerships with major cloud providers like Google Cloud and AWS to enhance service offerings and minimize egress fees[71]. - The Fast Forward program supports eligible open source projects by providing free Fastly products, promoting a free and open internet[60]. Compliance and Security - The company supports compliance with regulations such as HIPAA and GDPR, enhancing data privacy and security for customers[55]. - Fastly's Next-Gen WAF launched in Q1 2022 aims to enhance application security across various environments, with ongoing investments in this area[66]. Workforce and Culture - The company focuses on building a global, healthy, and safe workforce with an inclusive culture[79]. - The company has a unique support model designed for developers, with first-line support employees typically having an engineering background[83]. Currency and Financial Exposure - The functional currency of the foreign subsidiaries is the U.S. dollar, exposing the company to foreign exchange rate fluctuations[460]. - Foreign subsidiaries remeasure monetary assets and liabilities at period-end exchange rates, while non-monetary items are remeasured at historical rates[460]. - Revenue and expense accounts are remeasured at the average exchange rate during the period[460]. - The company does not currently engage in hedging activities to reduce potential exposure to currency fluctuations[460].

Group 1 - The article discusses the strategy of "buying the dip" in a volatile stock market that is near all-time highs, suggesting that certain stocks may rebound for reasons not related to broader market risks [1] - It highlights the importance of caution when investing in stocks that are declining, referred to as "falling knives," indicating that careful analysis is required [1] - The author, Gary Alexander, has extensive experience in technology companies and has been a contributor to Seeking Alpha since 2017, providing insights into industry trends [1] Group 2 - The article does not provide any specific investment recommendations or advice, emphasizing that past performance does not guarantee future results [3] - It clarifies that the opinions expressed are those of the author and do not necessarily reflect the views of Seeking Alpha as a whole [3] - The article notes that the analysts contributing to Seeking Alpha may not be licensed or certified by any regulatory body, indicating a diverse range of perspectives [3]

Core Insights - Fastly's stock experienced a significant decline of 22.1% during trading, despite positive movements in major indices like the S&P 500 and Nasdaq [1] - The company reported fourth-quarter sales that exceeded market expectations but fell short on earnings, leading to bearish sentiment among investors [2] Financial Performance - Fastly recorded a non-GAAP loss per share of $0.03 on revenue of $140.57 million in Q4, compared to Wall Street's expectation of break-even results on sales of $138.63 million [3] - Revenue increased by 2% year-over-year in Q4, marking an all-time high for the period, with the top 10 customers accounting for 32% of revenue, down from 33% in Q3 and 40% in Q4 2023 [4] Customer Diversification and Margins - The company is making progress in customer diversification, closing the quarter with 596 enterprise customers, a 3% year-over-year increase [4] - Despite better-than-expected sales, margins missed expectations, raising concerns about competitive positioning and pricing power [5] Future Guidance - For Q1, Fastly is guiding for a loss per share of $0.09 to $0.05 on sales of $136 million to $140 million, while analysts expected a loss per share of $0.01 on sales of $137.14 million [6] - For the full year, Fastly projects sales between $575 million and $585 million, indicating an annual growth of approximately 6.7%, with an adjusted loss per share forecasted between $0.15 and $0.09 [7] Investor Sentiment - With projected sales growth in the mid-single-digit range and losses expected to be similar to last year, investor confidence in Fastly's growth narrative is waning [8]

Fastly (FSLY) Q4 2024 Earnings Call February 13, 2025 03:00 AM ET Company Participants Vernon Essi - Investor RelationsTodd Nightingale - CEO and DirectorRon Kisling - Chief Financial OfficerFrank Louthan - Managing DirectorSanjit Singh - Executive DirectorMadeline Brooks - Vice President - Equity ResearchJeff Van Rhee - Partner - Equity ResearchChris Fountain - Equity Research Senior AssociateQuinton Gabrielli - VP - Equity Research Conference Call Participants None - AnalystRudy Kessinger - Managing Direc ...

Fastly, Inc. (NYSE:FSLY) Q4 2024 Earnings Conference Call February 12, 2025 4:30 PM ET Company Participants Vernon Essi - Investor Relations Todd Nightingale - Chief Executive Officer Ronald Kisling - Chief Financial Officer Conference Call Participants Frank Louthan - Raymond James & Associates, Inc. Rudy Kessinger - D.A. Davidson & Co. Sanjit Singh - Morgan Stanley Madeline Brooks - Bank of America Merrill Lynch Jeff Van Rhee - Craig-Hallum Capital Group Christopher Fountain - RBC Capital Markets LLC Quin ...

Revenue Projections - Total revenue for Q1 2025 is projected to be between $136.0 million and $140.0 million, with full-year 2025 guidance set at $575.0 million to $585.0 million[5] - Revenue for Q1 2024 was $133,520 thousand, a decrease of 3.1% from Q4 2023's $137,777 thousand[34] - The company expects revenue for Q2 2024 to be in the range of $132,371 thousand to $137,206 thousand, indicating a cautious outlook[34] - Revenue for Q4 2023 was $137,777, showing a 7.5% increase from Q3 2023's $127,816[37] - The company expects revenue growth to continue, projecting Q1 2024 revenue to be around $133,520[37] Financial Performance - Non-GAAP operating loss for Q1 2025 is expected to be between ($11.0) million and ($7.0) million, while the full-year 2025 loss is projected to be between ($15.0) million and ($9.0) million[5] - The net loss for Q1 2024 was $43,427 thousand, compared to a net loss of $23,386 thousand in Q4 2023, indicating a worsening financial position[34] - The company reported a non-GAAP net loss of $6,477 thousand for Q1 2024, compared to a non-GAAP net income of $1,730 thousand in Q4 2023[35] - The net loss for Q4 2023 was $2,268, a significant improvement compared to the loss of $12,552 in Q3 2023[37] - Adjusted EBITDA for Q4 2023 was $11,459, compared to $650 in Q3 2023, indicating strong operational performance[36] Customer Metrics - The enterprise customer count increased to 596 in Q4 2024, up from 576 in Q3 2024, representing a growth of 3.5%[8] - Customer packages grew over 60% year-over-year, with new logo packages growing 70% year-over-year[8] - The last 12-month net retention rate (LTM NRR) decreased to 102% in Q4 2024 from 105% in Q3 2024[8] - Fastly's top ten customers accounted for 32% of revenue in Q4 2024, down from 40% in Q4 2023[8] - Annual revenue retention rate (ARR) was 99.0% in 2024, a slight decrease from 99.2% in 2023[8] Operational Insights - Remaining performance obligations (RPO) were $244 million in Q4 2024, up 4% from $235 million in Q3 2024[8] - Fastly launched several new products, including Fastly DDoS Protection and Fastly AI Accelerator, expanding its service offerings[7] - The company identified an immaterial error in the historical calculation of total customer count, affecting revenue by less than $0.1 million for Q4 2024[1] - The Last Twelve Months (LTM) Net Retention Rate is calculated by adjusting for revenue contraction and expansion, providing a clearer view of customer revenue stability[2] - The Annual Revenue Retention (ARR) rate is 99.0%, down 0.2% year-over-year, indicating slight revenue loss from churned customers[4] Share and Equity Information - The company assumes a weighted average of 143.4 million basic shares outstanding in Q1 2025 and 147.1 million for the full year 2025[6] - The weighted average shares used in computing net loss per share for Q1 2024 were 134,587 thousand, an increase from 131,843 thousand in Q4 2023[35] - The weighted-average diluted shares increased from 129,873 in Q3 2023 to 141,162 in Q4 2023, indicating potential dilution effects[36] - Total stockholders' equity increased from $958,555 in Q1 2023 to $965,250 in Q4 2024, a growth of approximately 0.7%[39] Cash Flow and Expenses - Free Cash Flow is calculated as net cash used in operating activities minus capital expenditures, providing insight into cash generation capabilities[23] - The company experienced a net cash provided by operating activities of $11,132 thousand in Q1 2024, showing a recovery from prior losses[41] - The company reported a net cash used in financing activities of $(2,682) thousand in Q3 2023, reflecting ongoing debt management efforts[40] - The company’s stock-based compensation expense was $35,713 thousand in Q3 2023, reflecting ongoing employee incentive programs[40] - Capital expenditures in Q3 2023 included purchases of property and equipment totaling $(325) thousand, with capitalized internal-use software costs of $(4,951) thousand[41] Asset and Liability Overview - Total current assets decreased from $661,640 in Q1 2023 to $440,195 in Q4 2024, representing a decline of approximately 33.4%[39] - Cash and cash equivalents dropped significantly from $348,463 in Q1 2023 to $286,175 in Q4 2024, a decrease of about 17.9%[39] - Total liabilities decreased from $903,855 in Q1 2023 to $486,109 in Q4 2024, reflecting a reduction of approximately 46.3%[39] - Long-term debt, less current portion, decreased from $705,378 in Q1 2023 to $337,614 in Q4 2024, a decline of about 52.1%[39] - Total assets decreased from $1,862,410 in Q1 2023 to $1,451,359 in Q4 2024, a decline of about 22.0%[39]