Akamai's Strong Performance in Q4 and Full-Year Financial Results for 2024

Akamai Reports Impressive Financial Results for Q4 and Year-End 2024

Overview

On February 20, 2025, Akamai Technologies, Inc. (NASDAQ: AKAM) announced its financial results for the fourth quarter and the entire year ending December 31, 2024. The results highlighted a solid increase in revenue and significant growth in security services, underscoring the company’s strength in the cybersecurity and cloud computing sector.

Fourth Quarter Highlights

Akamai reported revenue of $1.020 billion for the fourth quarter, marking a 3% increase compared to the previous year’s quarter, which recorded $995 million. This growth was further emphasized when adjusted for foreign exchange fluctuations. Notably, security and compute revenue constituted 69% of total revenue for the quarter and experienced a robust year-over-year growth of 16% when adjusted for foreign currencies.

The earnings per diluted share (EPS) for the quarter stood at $0.91. This reflects a 12% decrease from the same quarter last year, but non-GAAP EPS showed a marginal decline of 2% to $1.66.

Security Revenue Surge

Security revenue for the fourth quarter reached $535 million, increasing by 14% year-over-year, while compute revenue saw a remarkable rise of 24%, amounting to $167 million. This growth illustrates Akamai's commitment to enhancing its security and computing solutions, which are becoming increasingly crucial for businesses.

Income and Operations

Despite the revenue growth, Akamai’s income from operations showed a dip, with GAAP income from operations for the fourth quarter at $148 million—a 20% decrease from $185 million the year before. The GAAP operating margin for the quarter was 15%, down 4 percentage points from the prior period. Yet, non-GAAP income remained stable at $298 million.

Full-Year Achievements

For the full year, Akamai reported total revenue of $3.991 billion, reflecting a 5% year-over-year increase. The security and compute segments accounted for 67% of total revenue, with security revenue growing 18% annually. Full-year GAAP net income was reported at $505 million, representing an 8% decline from the previous year’s $548 million, while non-GAAP net income saw a slight increase of 4% to $996 million.

Share Buybacks and Cash Flow

In terms of shareholder returns, Akamai repurchased $138 million of its shares in the fourth quarter alone. For the full year, the total spent on share repurchases was $557 million, showcasing the company’s commitment to bolstering shareholder value. Cash from operations for the fourth quarter was notable at $344 million, illustrating strong operational efficiency.

Looking Ahead

CEO Dr. Tom Leighton expressed optimism about the financial results, noting a trend of sustained momentum and profitability in Akamai's business model. As the company prepares for 2025, its focus on sustainable profitability across all sectors positions it well for future growth.

Akamai’s commitment to innovation in cybersecurity, coupled with its impressive financial results, highlights its strength as a provider of cloud computing solutions. With significant investments in product development and strategic initiatives, the company aims to maintain its edge in a competitive marketplace.

Conclusion

Akamai Technologies continues to demonstrate resilience and growth in a dynamic environment. With a solid foundation in security and cloud computing, the company is poised for long-term success as it heads into 2025.