Akamai Technologies Inc AKAM
Q1 2012 Earnings Call Transcript

Transcript Call Date 04/25/2012

Operator: Good day ladies and gentlemen and welcome to the First Quarter 2012 Akamai Technologies Earnings Conference Call. My name is Derek and I'll be your operator for today. At this time, all participants are in a listen-only mode. We will facilitate a question-and-answer session at the end of the conference.

I would now like to turn the call over to Ms. Natalie Temple, Investor Relations. Please proceed.

Natalie Temple - Manager, IR: Good afternoon and thank you for joining Akamai's investor conference call to discuss our first quarter 2012 financial results. Speaking today will be Paul Sagan, Akamai's President and Chief Executive Officer and Jim Benson, Akamai's Chief Financial Officer.

Before we get started, please note that today's comments include forward-looking statements, including statements regarding revenue and earnings guidance. These forward-looking statements are subject to risks and uncertainties and involve a number of factors that could cause actual results to differ materially from those expressed or implied by such statements.

Additional information concerning these factors is contained in Akamai's filings with the SEC, including our Annual Report on Form 10-K and quarterly reports on Form 10-Q. The forward-looking statements included in this call represent the Company's view on April 25, 2012. Akamai disclaims any obligation to update these statements to reflect future events or circumstances.

As a reminder, we will be referring to some non-GAAP financial metrics during today's call. A detailed reconciliation of GAAP and non-GAAP metrics can be found under the news and events portion of the Investor Relations section of our website.

Now, let me turn the call over to Paul.

Paul Sagan - President and CEO: Thanks Natalie, and thank you all for joining us today. Quite simply Q1 was a great quarter where we exceeded our expectations in almost every area and I couldn't be more pleased with the results and that strong Q1 performance really built on our record revenue achievement in the fourth quarter. We posted total revenue of $319 million in Q1, up 16% from the same period last year and organic growth on the top line accelerated year-over-year for the second straight quarter. We generated normalized EPS of $0.41, up 8% from Q1 of last year. We had another strong quarter of cash flow generation with $93 million of cash from operations in the quarter and we're pleased to announce that our Board has authorized another extension of our share repurchase program this time for a $150 million. I'll be back in a few minutes with some additional thoughts on our business and I will have some comments about the planned transition we announced today to eventually name a successor to me as President and CEO.

Let me turn the call over to Jim for more about our very strong first quarter results. Jim?

Jim Benson - EVP and CFO: Thank you, Paul. As I walk you through our very strong Q1 financial results in detail, I'll provide you with the consolidated numbers that includes roughly one month of the Cotendo acquisition, which closed in early March, and where appropriate, I'll also provide you with Akamai's results from Q1 excluding Cotendo. Revenue came in above our guidance range at $319 million, up 16% year-over-year with solid growth across the business. Cotendo accounted for less than $2 million in revenue for the quarter. Excluding the impact the Cotendo, revenue was up 15% year-over-year and down just 2% sequentially.

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