Key Stats for Akamai Stock
- Price change for Akamai stock: 26%
- $AKAM Share Price as of May. 8: $148
- 52-Week High: $150
- $AKAM Stock Price Target: $146
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What Happened?
Akamai (AKAM) stock surged 26% on Friday after the company announced a landmark $1.8 billion, seven-year cloud infrastructure deal with a “leading frontier model company.”
CEO Tom Leighton didn’t name the customer, but multiple reports pointed to Anthropic as the partner behind the deal.
The announcement came alongside Q1 earnings that held up well.
- Revenue rose 6% year-over-year to just over $1 billion.
- Cloud infrastructure services — Akamai’s fastest-growing segment — jumped 40% to $95 million.
- Security revenue climbed 11% to $590 million.
- The one soft spot was its legacy delivery business, which slipped 7% to $389 million, though management expects that decline to slow through the rest of the year.
For Q2, Akamai guided for revenue between $1.08 billion and $1.1 billion, with adjusted EPS of $1.45 to $1.65.
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What the Market Is Telling Us About Akamai Stock
Akamai stock has been overlooked by investors focused on hyperscalers like AWS and Microsoft Azure for years.
The company’s pitch has always been different: instead of centralizing compute in a handful of massive data centers, Akamai spreads its infrastructure across 4,300 locations in 700 cities across 130 countries.
That kind of reach matters a lot in AI inference, where bringing compute closer to the user reduces latency and improves performance.
CEO Leighton put it plainly on CNBC Friday morning: “I think we’ve been undervalued for a while, and investors have been looking for some real validation that our different approach is going to pay off.”
With this deal, they got it.
The $1.8 billion commitment is structured as dedicated capacity over seven years, meaning Akamai will recognize revenue steadily as it deploys hardware.
Management expects around $20-$25 million in revenue from the contract in Q4 alone, with a much larger contribution expected in 2027. The company plans to spend $700-$800 million on CapEx over the next 12 months solely to support this one customer.
Beyond the headline deal, Akamai’s security business is also picking up steam. The company noted that AI is making cyberattacks larger and harder to stop, which is driving more enterprises to its web application firewall and API security products.
As Leighton described it, the threat environment has never been more urgent — and Akamai’s distributed platform is one of the few that can intercept attacks at the scale being seen today.
Akamai stock is now up 65% over the past 12 months, and management expects double-digit total revenue growth to arrive by 2027.
Akamai stock got a major vote of confidence last week. With a record-breaking AI infrastructure deal, accelerating cloud growth, and a stronger security outlook, the company is making a credible case for being a core player in the AI economy.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
