What To Expect From Akamai’s First Quarter Earnings?

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Akamai (NASDAQ:AKAM) is scheduled to announce its Q1 earnings on Monday, April 30. The company reported strong numbers in recent quarters, particularly due to growth from its Performance & Security Solutions segment. Service & Support Solutions have also contributed meaningfully to growth, while Media Content Delivery Solutions revenues have declined in recent years. The key reason for the decline in Media Content Delivery Solutions has been the fact that some of the company’s largest customers such as Amazon, Apple, Facebook, Google, Microsoft, and Netflix deployed content delivery networks (CDNs) of their own. While the company will likely continue to report growth in CDN services from small and medium-sized businesses, the overall segment revenues are expected to decline in the coming quarters. Despite the lackluster CDN growth, we expect solid growth in revenues from Performance & Security Solutions to continue to drive overall results.

For the March quarter, we expect Performance & Security Solutions revenues to increase 14% y-o-y to $420 million for the quarter, while Media Deliver Solutions revenues are expected to fall 3% to under $180 million. We forecast the resulting net revenues to increase 7% y-o-y to $653 million for the quarter. Margins are expected to be roughly flat over the comparable prior year period, due to which we expect the earnings per share to be around 3 cents a share higher over Q1’17 at $0.72. We have summarized our expectations for Akamai’s first quarter earnings on our interactive dashboard platform. If you think differently or disagree with our forecasts, you can modify expected segment revenues and margins for the quarter to see how the EPS will be affected in for the quarter.

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