Akamai Technologies shares declined following the company's fourth-quarter 2025 earnings announcement. While the company beat expectations with Q4 adjusted earnings per share of $1.84 versus the anticipated $1.76, and Q4 revenues of $1.09 billion, the stock fell due to disappointing forward guidance. The company issued weak fiscal-year 2026 adjusted earnings per share guidance below analyst estimates and provided Q1 guidance that fell short of expectations. Additionally, Akamai announced increased capital expenditures for 2026, estimating capex will represent 23 to 26 percent of revenue, up from 19 percent in 2025. This capital spending outlook weighed on earnings expectations. TD Cowen maintained a Hold rating and lowered its price target to $100. Despite the stock decline, analysts maintained a consensus Outperform rating on the company.
Read full analysisAkamai Technologies shares declined following the company's fourth-quarter 2025 earnings announcement. While the company beat expectations with Q4 adjusted earnings per share of $1.84 versus the anticipated $1.76, and Q4 revenues of $1.09 billion, the stock fell due to disappointing forward guidance. The company issued weak fiscal-year 2026 adjusted earnings per share guidance below analyst estimates and provided Q1 guidance that fell short of expectations. Additionally, Akamai announced increased capital expenditures for 2026, estimating capex will represent 23 to 26 percent of revenue, up from 19 percent in 2025. This capital spending outlook weighed on earnings expectations. TD Cowen maintained a Hold rating and lowered its price target to $100. Despite the stock decline, analysts maintained a consensus Outperform rating on the company.
Akamai Technologies operates one of the world's largest content delivery networks and has been expanding aggressively into cybersecurity and cloud computing, which now generate roughly two-thirds of revenue. The company is investing heavily in its Akamai Inference Cloud for edge AI inference, but this pivot is straining near-term profitability — FY2026 capital expenditures are projected at 23%–26% of revenue, nearly double historical averages, compounded by a memory chip shortage inflating hardware costs. The resulting gap between strong Q4 execution and a below-consensus FY2026 profit outlook is driving the current selloff.