Akamai Technologies, Inc. (NASDAQ:AKAM) Faces Market Pressure Despite Strong Performance

Core Viewpoint - Akamai Technologies, Inc. is facing challenges despite strong Q4 performance, with future guidance not meeting market expectations, leading to a decline in stock price [2][6]. Financial Performance - Q4 revenues reached $1.09 billion, reflecting a 7.4% year-over-year increase [2][6]. - GAAP net income decreased to $85.1 million or 58 cents per share, down from $139.9 million or 91 cents per share in the previous year [4]. Future Guidance - The company's Q1 EPS guidance is projected between $1.50 and $1.67, while FY26 EPS guidance is between $6.20 and $7.20, both falling short of market expectations [2][6]. - Akamai projects 2026 revenue to be between $4.4 billion and $4.55 billion, exceeding Wall Street predictions [5]. Segment Performance - The Cloud Infrastructure Services (CIS) segment saw a significant revenue increase of 45% year-over-year, reaching $94 million, driven by demand for ISV solutions, IaaS, storage customers, and AI-related services [3][6]. - Security revenue increased by 11%, supported by demand for the Guardicore Segmentation platform and API security offerings [4]. Market Reaction - Following the guidance announcement, Akamai's stock experienced a 14.07% decline, equating to a $15.42 drop, with a trading volume of 15,779,607 shares [5][6]. - Goldman Sachs maintained a "Sell" rating on Akamai, adjusting the stock's price target to $76 [1].