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Akamai Tech 3Q Pft Falls 1.8%; Results Beat Forecasts – WSJ.com

 

Akamai Technologies Inc.’s (AKAM) third-quarter profit slipped 1.8% on falling margins as the Internet content-delivery company beat its own forecasts.

Long considered the go-to content-delivery network for speeding up delivery of Web pages and Internet videos, Akamai has acquired a number of challengers in the past decade and is fending off a new wave of competition. Akamai also recently jumped into the online advertising-delivery business.

President and Chief Executive Paul Sagan said the company saw promising signs in high-quality video online and strong demand for its value-added solutions.

The company posted income of $32.7 million, or 18 cents a share, down from $33.4 million, or 18 cents a share, a year earlier. The company had 2.7% fewer shares outstanding a year ago. Excluding stock-based compensation, acquisition-related costs and other items, earnings fell to 38 cents from 40 cents.

Revenue increased 4.6%, to $206.5 million.

In July, the company had forecast earnings of 33 cents to 36 cents and revenue of $195 million to $203 million. Both figures were below analysts’ estimates at the time.

Gross margin fell to 70% from 71.3%.

The number of customers under long-term service contracts at the end of the quarter rose 7.9%.

Shares fell 5 cents, to $20.11, in after-hours trading.

-By Kerry Grace Benn, Dow Jones Newswires; 212-416-2353; kerry.benn@dowjones.com

Akamai Tech 3Q Pft Falls 1.8%; Results Beat Forecasts – WSJ.com

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