Akamai Technologies, Inc. Q1 FY2026 earnings call

CEO F. Thomson Leighton noted Akamai's strong start to the year, major milestones in cloud computing strategy like unveiling NVIDIA AI grid and signing a $1.8 billion seven-year commitment for cloud infrastructure services. Security portfolio had 11% y/y revenue growth led by web application firewall, API security, etc. CFO Edward J. McGowan discussed Q1 results, updated guidance for Q2 and full-year 2026, and investment plans related to CIS growth.

Total revenue was $1.074 billion, up 6% year over year as reported and 4% in constant currency. Cloud infrastructure services (CIS) revenue was $95 million, up 40% year over year as reported and 39% in constant currency. Security revenue was $590 million, up 11% year over year as reported and 9% in constant currency. Delivery and other cloud applications revenue was $389 million, down 7% year over year as reported and 8% in constant currency. CIS contributed ~8.8% to total revenue, security ~55%, and delivery & other ~36.2%.

Q2 revenue expected to be $1.075 billion - $1.1 billion, up 3%-5% y/y. Full-year 2026 revenue $4.445 billion - $4.55 billion, up 6%-8% y/y. CIS cloud infrastructure services to have at least 50% constant currency y/y growth. Security revenue to grow in high single digits constant currency. Delivery and other cloud apps to decline mid-single digits constant currency. Q2 non-GAAP EPS $1.45 - $1.65. Full-year 2026 non-GAAP EPS $6.40 - $7.15.

Impact from macroeconomic trends, integration of any acquisition, geopolitical developments, AI-related attack risks with increased volumes and scale challenges, and potential zero-day attacks becoming more frequent.

Q: Congrats on the landmark deal there. Maybe if you can, Tom, just broad strokes about the competitive set to win that deal. Are you going toe to toe with hyperscalers or neo-clouds? And anything you can provide on the use cases—inference, is it agentic workloads? And as you think about your compute-enabled PoPs, how is this customer leveraging the Akamai Technologies, Inc. network as a whole?

A: I cannot give any more details about this specific deal. But in general, yes, we do compete with the hyperscalers and the neo-clouds with our cloud infrastructure services...

Q: Thanks for taking my question. My first question is for Ed, and I have a quick follow-up for Tom. Ed, thanks for all the detail on CapEx. But when I think about the CapEx for this mega deal—this is over a long time, seven years—are you accountable for, for example, higher memory costs if those rise in the future? When you locked in this deal, do you also have the supply locked in, or are you exposed if that were to happen two years from now?

A: Great question. I was fortunate enough to work very closely with the team on both sides of this transaction. We have been able to get the supply chain ready...