Akamai's third-quarter sales rose 6% on modest security and cloud-compute revenue. Management announced targets of $1.2 billion in cloud-computing revenue in 2027, and over $7 billion in total revenue for 2028, implying a faster path to its previously stated $2.2 billion annualized run rate.
Wireless network enhancements and Internet of Things deployments will increase data traffic, adding demand to house content and services as close to customers as possible.
Bears
Media customers of CDNs will continue to insource the transmission of their content, making a content segment turnaround more difficult.
Akamai operates a content delivery network, in which customers store content on distributed servers to deliver it to their own customers more quickly. Akamai has over 350,000 servers distributed over 4,350 points of presence in more than 700 cities globally. This network supports upward of 20% of global internet traffic, generating massive amounts of data. Using data generated by the delivery network, the firm offers cybersecurity products and cloud computing services, ranging from API security to zero-trust enterprise access, which has surpassed the delivery network in revenue and importance. As of 2026, the primary focus has shifted to offering computing hardware as a service, with an emphasis on serving large language model providers such as Anthropic.