Posted by : Randy Cooper in (CDN)

Akamai Q2 Sales Light, Profits In Line, Guidance Very Weak (AKAM)

Akamai (AKAM) posted a mixed Q2: Revenues came in light, profit was in-line, and subscriber growth was better than expected. But the content delivery network also cut full-year guidance and issued a disappointing Q3 outlook; shares are down 16% in after-hours trading to $26.10.

Why the grim outlook? On the company’s earnings call, CEO Paul Sagan outlined two trends:

  • The soft economy means customers in some verticals aren’t spending as much on Akamai projects as they might otherwise.
  • Growth is slowing for media companies’ Web sites, including streaming video. Eventually, Akamai will get to push higher-quality video to consumers, which they’ll get to bill more for. But right now, Sagan says, most Americans don’t have the bandwidth to watch HD video over their home Internet connections.


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