Akamai Q2 Earnings Surpass Estimates, Revenues Increase Y/Y

Core Insights - Akamai Technologies, Inc. (AKAM) reported strong second-quarter 2025 results, with both revenue and net income exceeding the Zacks Consensus Estimate [1][2] Financial Performance - GAAP net income decreased to $103.6 million or 71 cents per share from $131.7 million or 86 cents per share year-over-year, impacted by high operating expenses [2] - Non-GAAP net income increased to $251.4 million or $1.73 per share compared to $242.6 million or $1.58 per share a year ago, beating the Zacks Consensus Estimate by 18 cents [2] - Quarterly net sales reached $1.04 billion, a 7% increase from $979.6 million in the prior year, driven by strong momentum in the Security and Compute verticals, surpassing the Zacks Consensus Estimate of $1.02 billion [3] Revenue Breakdown - Security Technology Group revenues were $551.9 million, up 11% from $498.7 million year-over-year, primarily due to demand for Guardicore Segmentation Solution and API security solutions [4] - Delivery segment revenues fell to $320 million from $329.4 million year-over-year, but exceeded the estimate of $301.6 million [5] - Compute segment revenues increased to $171.4 million from $151.5 million in the prior year, driven by demand for cloud infrastructure services, beating the estimate of $165.7 million [5] Regional Performance - Net sales from the United States were $527.6 million, a 4% year-over-year increase, while international revenues totaled $515.9 million, up from $470.8 million in the previous year [6] Operating Expenses and Margins - Total operating expenses rose to $892 million from $831.6 million year-over-year, while non-GAAP income from operations improved to $308.6 million from $281.5 million, with margins of 30% and 29% respectively [7] - Adjusted EBITDA increased to $444.4 million from $408.9 million in the prior year [7] Cash Flow and Share Repurchase - Akamai generated $459.1 million in cash from operating activities compared to $430.9 million in the prior year [8] - As of June 30, 2025, the company had $850.3 million in cash and cash equivalents and repurchased approximately 3.9 million shares for around $300 million [9] Future Outlook - For Q3 2025, Akamai expects revenues between $1.03 billion and $1.05 billion, with a non-GAAP operating margin projected at 28% [10] - For the full year 2025, revenues are expected to be in the range of $4.135 billion to $4.2 billion, with non-GAAP earnings projected between $6.60 and $6.80 per share [11]