Akamai Flops on Feeble Forecast
SAN FRANCISCO -- Akamai (AKAM) matched Wall Street estimates for second-quarter earnings, but the company's forecast hurt the stock in after-hours trading.
The company, which provides service for accelerating online content and applications, posted a profit of $34.3 million, or 19 cents a share. Excluding certain items, Akamai earned $76.5 million, or 41 cents a share, in line with estimates by analysts.
Revenue in the second quarter totaled $194 million, a 27% increase over last year in the same period, but still missing analysts' expectations for $197 million.
"We delivered solid results in a challenging environment," said Paul Sagan, chief executive of Akamai. "We continued to benefit from the diversity of our enterprise-class customer base and increasingly broad portfolio of value-added solutions that have gained significant acceptance in the marketplace."Akamai's customer base under long-term services contract at the end of the second quarter grew by 53 to a total of 2.725. Sales through resellers accounted for 16% of the company's revenue in the second quarter while international sales accounted for 26%. Any good news ended there, however, after the company said it expected to earn 39 cents to 40 cents a share in the third quarter, below the current analyst consensus of 42 cents a share. Akamai also cut its full-year EPS forecast to $1.63 to $1.69 from $1.68 to $1.71. Shares of Akamai tumbled more than 17% to $25.81 in extended trading.
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