Core Viewpoint - Fastly reported record GAAP revenue of $148.7 million in Q2 2025, exceeding analyst expectations, while also narrowing its non-GAAP net loss per share, indicating operational progress despite ongoing profitability pressures [1][5][11] Financial Performance - GAAP revenue reached $148.7 million, a 12% increase year-over-year from $132.4 million in Q2 2024 [2][5] - Non-GAAP net loss per share improved to ($0.03), better than the anticipated ($0.05) loss, marking a 50% improvement from ($0.06) in Q2 2024 [2] - Free cash flow turned positive at $10.9 million, a significant recovery from a negative $18.5 million in the previous year [2][6] - Non-GAAP gross margin slightly decreased to 59.0%, down 0.4 percentage points from the previous year [2][6] - Operating loss on a non-GAAP basis narrowed to $4.6 million, a 60% improvement year-over-year from $11.5 million [2][6] Revenue Breakdown - Network services revenue was $114.9 million, up 10% year-over-year, while security revenue increased by 15% to $29.3 million [5] - The "Other" segment, which includes Compute and Observability products, surged 60% to $4.5 million [5][9] Customer Trends - Revenue concentration from the top 10 customers decreased to 31%, down from 34% a year ago, indicating improved diversification [7] - Revenue from customers outside the top ten grew by 17%, compared to only 2% growth from the top ten [7] - Remaining performance obligations reached a record $315 million, representing a 41% year-over-year growth [7] Product Innovation and Strategy - Fastly is focusing on enhancing its security offerings and expanding programmable edge services, including AI Bot Management and DDoS protection [4][9] - The company has seen a 130% year-over-year increase in renewals involving multi-product packages, indicating successful account penetration [8] Future Guidance - Management raised its FY2025 revenue guidance to between $594 million and $602 million, implying around 9% growth at the midpoint [11] - For Q3 2025, projected total revenue is expected to range from $149.0 million to $153.0 million [11] - The company anticipates reaching operating profitability in the second half of FY2025, with a non-GAAP operating loss forecasted between $9 million and $3 million [11]