Akamai Earnings: Security and Computing Shine, While Delivery Continues to Struggle

Akamai’s growth businesses continue to more than offset the continually declining legacy content delivery network business. For the first time, security revenue alone made up more than half of Akamai’s total revenue in the quarter, while the computing segment continued to see customer uptake and exhibit the most rapid growth. Delivery revenue made up less than one third of total revenue during the quarter, which we see as a huge credit to management, which has been able to completely transform the company from one that had been dependent on what we see as a commoditized CDN business that has been the basis for our no-moat rating. We are maintaining our $100 fair value estimate.