NASDAQInformation TechnologySoftware - InfrastructureSnapshot 2026-08-31
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Create your account →Broken: Primary pillar broken — Non-GAAP operating margin near 29%: FY26 non-GAAP operating margin guided at 25.5% vs 29% target.
Akamai grows revenue about 7% yearly, driven by cloud services. Profit margins stay steady near 29%. The company wins big cloud deals and partnerships, boosting growth. Its valuation is cheap versus peers, with free cash flow positive.
Revenue growth could slow below 7%. Margins may compress from rising costs. Debt issuance and capital obligations could pressure financials. Market expects 11% growth, which Akamai may not meet.
The price is about 20% below our fair value near $143. Analysts expect 11% revenue growth, slightly above Akamai's recent 6-7%. Our fair value is 16% below the Street median, reflecting cautious optimism.
Breaks if: Debt servicing or capital costs materially impair cash flow or margins
Breaks if: Cloud Infrastructure Services revenue growth falls below 30% YoY in FY26
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a durable compounder with a focus on expanding cloud infrastructure services. The current thesis state is intact, supported by steady revenue growth despite recent earnings misses.
The market currently prices AKAM as justified, reflecting a low expectations gap compared to peers. Valuation suggests it is relatively cheap versus its industry counterparts.
Fundamentals are likely to show continued revenue growth, particularly in the cloud infrastructure and security segments. However, there is some risk of margin compression as operating margins have declined recently.
The thesis hinges on the performance of sector bellwethers like MSFT, ORCL, and PLTR. Positive earnings and guidance from these companies could provide a favorable environment for AKAM, while negative trends could pose risks.
The most important moves since the prior daily snapshot.
Yes, our read has strengthened. The latest earnings beat supports a positive outlook for growth. Revenue growth is backed by strong commitments in cloud infrastructure services. The company also launched new AI security features, reinforcing its growth strategy.
as of 2026-08-31
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Continue investing in and growing the Cloud Infrastructure Services segment, including multi-year contracts and AI infrastructure positioning.
Stated as a priority in 5 of last 5 quarters. Cloud Infrastructure Services revenue grew from $71 million in 2025-Q2 to $99 million in 2026-Q2, a 39% increase year-over-year. Management highlighted multi-year CIS contracts worth over $2.8 billion, including a $600 million contract, validating their AI infrastructure positioning. The trajectory is delivering with sustained strong growth and contract wins.
“Rapid growth of our CIS portfolio with multi-year contracts worth over $2.8 billion”
“Leading frontier model provider committed $1.8 billion over seven years for CIS”
“Cloud Infrastructure Services revenue up 45% year-over-year, benefiting from AI applications growth”
“Cloud Infrastructure Services revenue up 39% year-over-year; launched Akamai Inference Cloud”
“Cloud Infrastructure Services revenue up 30% year-over-year; increasing guidance for remainder of year”
Breaks if: Operating margin falls below 25% in FY26
Breaks if: YoY revenue growth falls below 5% in FY26
Over the next 1 to 3 years, AKAM's prospects will depend on its ability to maintain growth in cloud services and navigate sector challenges. Not investment advice.
