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Fastly, Inc. (FSLY) Citi's 2026 Global TMT Conference September 9, 2026 8:10 AM EDT

Company Participants

Richard Wong - Chief Financial Officer
Vernon Essi - Head of IR

Conference Call Participants

Fatima Boolani - Citigroup Inc., Research Division

Presentation

Fatima Boolani
Citigroup Inc., Research Division

Boolani. I jointly head up our software equity research franchise here at Citi. And I'm very excited to kick off day 2 of Citi's TMT Conference with Fastly. So on stage with me is CFO, Rich Wong; and also Head of Investor Relations, Vernon Essi. Thank you so much for being here.

Richard Wong
Chief Financial Officer

Thank you for having us.

Question-and-Answer Session

Fatima Boolani
Citigroup Inc., Research Division

Excellent. Well, I'm looking forward to a very productive discussion. So maybe just to kind of get the conversation flowing and started, Rich, happy 13 months...

Richard Wong
Chief Financial Officer

Yes.

Fatima Boolani
Citigroup Inc., Research Division

in the job...

Richard Wong
Chief Financial Officer

Thank you for remembering.

Fatima Boolani
Citigroup Inc., Research Division

So a whirlwind year for you at the company. So I think a good place to start would be 13 months in review, right? The most important structural changes to the business that you've witnessed in the last 12 months and also the changes you've effected in the last 12, 13 months.

Richard Wong
Chief Financial Officer

Well, thank you for remembering my 13 months. It has been a whirlwind. It's been a lot of fun. For those of you who don't know Fastly, I can just start with a real quick introduction on what Fastly is and what we do. We are an edge cloud provider. We break our revenues down into 3 main revenue lines where we do delivery services, which is really accelerating the Internet. Really, we have 166 points of presence around the world that helps

It has been about a month since the last earnings report for Fastly (FSLY - Free Report) . Shares have lost about 6.9% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Fastly due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its latest earnings report in order to get a better handle on the important catalysts.

Fastly Q2 Earnings Beat as Security Growth Spurs 2026 Outlook HikeFastly reported second-quarter 2026 adjusted earnings of 15 cents per share versus a loss of 3 cents a year ago. The figure topped the Zacks Consensus Estimate by 114.29%.

Revenues rose 23.3% year over year to $183.32 million and surpassed the consensus mark by 5.34%. Strength across Network Services, Security and Compute supported the upside, while the last-12-month net retention rate climbed to 117%.

FSLY's Platform Strategy Drives Broad GrowthNetwork Services revenues increased 17% year over year to $133.9 million, accounting for 73% of total revenues. Management attributed the performance to higher traffic among its largest customers, along with a smaller contribution from live sporting events.

Fastly also said it is gaining share where performance is critical. The company highlighted major global sporting events that generated record traffic and cited customer wins tied to resilience, flexibility and consolidated edge services.

Fastly's Security Momentum Lifts Revenue MixSecurity revenues advanced 43% year over year to $41.7 million and represented 23% of revenues, up from 20% a year earlier. Management said DDoS protection and bot management grew at triple-digit rates, while its next-generation web application firewall continued to gain traction.

Other revenues, which include Compute and Observability, climbed 69% to $7.7 million. Compute demand benefited from customers building low-latency applications and managing artificial intelligence (AI)-related traffic, supporting a combined Security and Other annual revenue run rate of nearly $200 million.

Fastly's Platform Strategy Gains TractionManagement said customers are adopting more products on Fastly’s unified platform, strengthening cross-sell and upsell activity. The company highlighted triple-digit growth in DDoS protection and bot management, while its web application firewall continued to gain traction.

AI-generated and agentic traffic also remained a demand catalyst. Fastly noted that machine traffic requires real-time decisions around authorization, caching, throttling and blocking, supporting adoption across Security, Compute and Network Services.

The company expanded its product reach through a partnership with Skyfire, designed to verify AI-agent identities and enable transactions at the edge. It also released a C++ software development kit for Fastly Compute to support low-latency AI, gaming and other workloads.

Fastly also highlighted its collaboration with LALIGA on an AI-driven system that detects and stops pirated streams in real time. The project illustrates how the company is pairing content delivery with security and edge-compute capabilities.

FSLY's Customer Metrics Show Deeper AdoptionThe last-12-month net retention rate improved from 113% in the first quarter and 104% in the year-ago quarter. The increase reflected broader product adoption and higher usage across a range of customers as Fastly expanded cross-selling and upselling efforts.

Large customer count was 624 at the end of the quarter. Average annualized spend per large customer was $1.11 million, reflecting broader use of the platform across delivery, security and emerging edge-compute workloads.

The top 10 customers represented 37% of revenues. Revenues from this group grew 48% year over year, while revenues from customers outside the top 10 increased 12%. Remaining performance obligations climbed 38% to $341 million, with the current portion rising 44%.

Fastly Expands Margins & Operating LeverageNon-GAAP gross margin expanded 680 basis points year over year to a record 65.8%. Management attributed the improvement to higher revenues relative to infrastructure costs and continued cost discipline.

Non-GAAP operating expenses were $93.7 million. Non-GAAP operating income totaled $27 million compared with an operating loss of $4.6 million a year ago. Adjusted EBITDA increased to $38.1 million from $8.9 million, while adjusted EBITDA margin reached 21%.

FSLY’s Balance Sheet DetailsAs of June 30, 2026, cash, cash equivalents, marketable securities and investments totaled approximately $337 million, up $7 million from March 31, 2026. Fastly ended the quarter with a positive net cash balance of $14 million.

Net cash provided by operating activities was $39.3 million, compared with $25.8 million a year earlier. Free cash flow totaled $3.6 million versus $10.9 million in the prior-year quarter, as infrastructure capital expenditures represented approximately 17% of revenues.

FSLY Raises 2026 Outlook, Sees AI as TailwindFor the third quarter of fiscal 2026, FSLY expects revenues to be in the range of $184-$190 million and non-GAAP earnings of 11-13 cents per share. The company projects non-GAAP operating income of $20-$24 million.

Fastly raised its 2026 revenue guidance to $732-$746 million and non-GAAP earnings outlook to 50-54 cents per share. Non-GAAP operating income is expected between $88 million and $96 million, reflecting an operating margin of approximately 12% at the midpoint.

Management views AI-driven demand as a tailwind across the business. AI tool usage is contributing to traffic growth among some of Fastly’s fastest-growing customers, with the impact most pronounced in Security and Compute and also evident in Network Services.

How Have Estimates Been Moving Since Then?It turns out, fresh estimates have trended upward during the past month.

The consensus estimate has shifted 45.33% due to these changes.

VGM ScoresAt this time, Fastly has a strong Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for value investors.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

OutlookEstimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Fastly has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.

Performance of an Industry PlayerFastly belongs to the Zacks Internet - Software industry. Another stock from the same industry, CCC Intelligent Solutions Holdings Inc. (CCC - Free Report) , has gained 11.1% over the past month. More than a month has passed since the company reported results for the quarter ended June 2026.

CCC Intelligent Solutions reported revenues of $285.93 million in the last reported quarter, representing a year-over-year change of +9.8%. EPS of $0.10 for the same period compares with $0.09 a year ago.

CCC Intelligent Solutions is expected to post earnings of $0.11 per share for the current quarter, representing a year-over-year change of +22.2%. Over the last 30 days, the Zacks Consensus Estimate remained unchanged.

CCC Intelligent Solutions has a Zacks Rank #2 (Buy) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of B.

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Analyst’s Disclosure: I/we have a beneficial long position in the shares of FSLY either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

On August 24, 2026, Fastly Inc
FSLY -8.09% 53

shares fell 8.1%, bringing the stock price down to $22.94. Over the past year, the shares have traded between a low of $7.06 and a high of $34.82, reflecting significant volatility.

GF Value™ verdict: Current price of $22.94 vs GF Value of $10.90, indicating a 110.5% overvaluation.GF Score™: 53/100, suggesting an average overall performance.Most notable signal: Insiders sold $67.1 million worth of shares in the past 12 months, with no buying activity.Is FSLY Overvalued or Undervalued?Fastly Inc's current valuation presents a stark contrast when compared to its GF Value™ estimate. The GF Value™ is GuruFocus' proprietary intrinsic value estimate derived from a combination of historical trading multiples, past business growth, and future performance projections. For Fastly, the GF Value™ is set at $10.90, which signifies that the stock is currently trading at a substantial premium, with a 110.5% overvaluation based on its current price of $22.94.

This overvaluation raises a significant risk for potential investors, as the current market price does not appear to provide a margin of safety for investment. The GF Valuation label indicates that Fastly is significantly overvalued, warning investors of the potential for a price correction. Given that Fastly is currently unprofitable and cash-flow negative, relying on earnings-based valuation metrics like P/E is not applicable or meaningful in this context. Instead, a Price-to-Sales (P/S) analysis would be more relevant, especially considering Fastly's historical P/S median of approximately 4.6x.

How Does FSLY's Valuation Compare to Its History?MetricCurrentHistoricalP/E (TTM)N/A5-year median P/EForward P/E201.1xN/ASince Fastly currently does not have a positive earnings figure, a P/E analysis is not applicable. However, the forward P/E of 201.1x indicates that the stock is trading at an extraordinarily high valuation compared to traditional metrics. This aligns with the GF Value™ verdict that suggests overvaluation, reinforcing the idea that Fastly's current price is not justified based on its historical valuation metrics.

What Does FSLY's GF Score™ Tell Us?The GF Score™ evaluates a stock across multiple dimensions, including financial strength, profitability, growth potential, valuation, and momentum. Fastly's GF Score™ of 53/100 indicates an average performance across these metrics. The company shows a stronger growth rank of 8/10, suggesting potential for future expansion, while it struggles with a weak valuation rank of 1/10, highlighting significant overvaluation concerns.

MetricRatingGF Score™53Financial Strength6/10Profitability3/10Growth8/10Valuation1/10Momentum1/10The analysis of the GF Score™ indicates that while Fastly has some growth potential, indicated by its growth rank, its weak valuation and profitability ranks suggest significant challenges ahead. The low scores in valuation and momentum also hint at investor sentiment that is not favorable, particularly in light of the significant insider selling activity.

What Are Gurus and Insiders Doing with FSLY?Currently, five gurus hold positions in Fastly, with two increasing their stakes while six have trimmed their positions in recent quarters. This mixed activity among institutional investors signals a cautious approach toward the stock. Notably, insiders have sold $67.1 million in shares over the past year without any buying activity, which could be interpreted as lack of confidence in the company's near-term prospects.

This pattern of insider selling, combined with the mixed signals from guru activity, suggests a potential lack of conviction in Fastly's future performance from both insiders and professional investors. Such trends can be critical indicators for potential investors to consider.

What This Means for InvestorsBased on the analysis, Fastly Inc
FSLY -8.09% 53

is currently overvalued according to GF Value™, which indicates a fair value of $10.90 compared to the current trading price of $22.94. The significant overvaluation, along with weak profitability and momentum metrics, suggests caution for potential investors. For a deeper exploration of Fastly's financial health and performance, visit the Fastly Inc (FSLY) stock page for more insights.

Frequently Asked QuestionsWhat is FSLY's GF Score™?

FSLY's GF Score™ is 53/100, indicating average performance across various metrics that assess the company's financial and operational health.

Is FSLY overvalued or undervalued?

FSLY is significantly overvalued based on GF Value™, with a current price of $22.94 compared to a fair value estimate of $10.90.

What is FSLY's P/E ratio?

FSLY currently has a forward P/E of 201.1x, which is extremely high and indicates that the stock is trading at a significant premium compared to its historical valuation metrics.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

Richard Wong, Chief Financial Officer of Fastly, Inc. (FSLY +9.86%), sold ~148,000 shares of Class A Common Stock at $28.61 per share on August 18, 2026. SEC Form 4 filing

Transaction summaryMetricValueTransaction value~$4.2 millionShares sold148,015Post-transaction shares (directly held)1,091,286Post-transaction value~$29.02 millionTransaction value based on SEC Form 4 weighted average sale price ($28.61); post-transaction value based on August 18, 2026 market close ($26.59).

Key questionsWhat was the primary driver for this transaction?
The sale was non-discretionary and conducted automatically to cover tax liabilities associated with the vesting of equity awards, which indicates it was not a discretionary assessment of the company's current valuation.How does this sale compare to the executive's remaining position?
Despite the sale of ~148,000 shares, the CFO maintains a direct ownership interest of 1,091,286 shares, which represents approximately 88% of his holdings prior to the transaction.What has been the stock's recent performance trajectory?
As of the transaction date, the stock had delivered a one-year return of 276%, and shares were priced at $23.66 as of the August 19, 2026 market close.Company OverviewMetricValueShare Price (as of market close 2026-08-19)$23.66Market Capitalization$3.7 billionRevenue (TTM)$687.2 millionNet Income (TTM)-$81.1 millionCompany SnapshotFastly provides an advanced edge cloud computing platform that enables developers to build, secure, and deliver digital experiences at the internet's edge, generating revenue through subscription-based access to its Infrastructure as a Service (IaaS) platform.The company operates on a SaaS model, delivering customizable edge computing solutions that allow enterprises to manage, distribute, and safeguard applications across a global network spanning North America, Asia Pacific, Europe, and other international markets.Fastly serves enterprise customers and developers seeking to optimize content delivery, application performance, and security through edge computing capabilities, with particular strength among media, technology, and e-commerce organizations.Fastly operates as a specialized edge cloud infrastructure provider with a market cap of $3.7 billion, positioning it as a significant player in the high-growth edge computing segment. The company's platform enables real-time application delivery and security at the network edge, providing customers with reduced latency and enhanced performance compared to traditional centralized cloud architectures.

Despite current net losses of $81.1 million on a trailing 12-month basis, Fastly's strategic focus on the expanding edge computing market and its differentiated technology platform underscore its competitive positioning within the broader infrastructure software sector.

What this transaction means for investorsDespite involving shares worth over $4 million, CFO Richard Wong's Aug. 18 sale of Fastly stock is not a red flag for investors. It was a non-discretionary transaction executed to fulfill tax withholding obligations in connection with the vesting of restricted stock units (RSUs).

An RSU is a form of compensation where a company promises to give an employee shares of stock at a future date. When that vesting date arrives, as was the case here, a "sell to cover" transaction occurs to pay for the related taxes.

Post-transaction, Wong maintains nearly 1.1 million shares, a significant equity stake in the company. This ensures his continued alignment with shareholder interests.

Fastly's business is doing well. The company reported record second quarter revenue of $183.3 million, representing 23% year-over-year growth. It posted a Q2 net loss of $15.6 million, but that's a big reduction from a $37.5 million net loss in 2025, indicating Fastly is moving closer to achieving eventual profitability.

Robert Izquierdo has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Fastly. The Motley Fool has a disclosure policy.

Paula Loop, Director at Fastly, Inc. (FSLY -0.34%), sold 7,332 shares of Class A Common Stock on Aug. 12, 2026, as disclosed in a recent SEC Form 4 filing.

Transaction summaryMetricValueTransaction value$219,960Shares sold (directly held)7,332Post-transaction shares (directly held)90,443Post-transaction value$2.58 millionTransaction value based on SEC Form 4 weighted average sale price ($30.00); post-transaction value based on Aug. 12, 2026, market close ($28.53).

Key questionsWhat was the regulatory context of this transaction?
The sale of 7,332 shares was executed pursuant to a Rule 10b5-1 trading plan adopted by Paula Loop on May 11, 2026, which allows corporate insiders to establish predetermined trading instructions to meet liquidity needs without access to material non-public information.How does this sale impact the insider's total equity position?
The reporting person now holds a direct stake of 90,443 shares of Class A Common Stock, valued at $2.58 million based on the market close of $28.53 on the transaction date of Aug. 12, 2026.What is the current level of internal ownership at the company?
As of the most recent filing data, insiders at the San Francisco-based software firm maintain a collective ownership interest of 0.0578%.Company OverviewMetricValueShare Price (as of market close 2026-08-13)$30.02Market Capitalization$4.7 billionRevenue (TTM)$687.2 millionNet Income (TTM)-$81.1 millionCompany SnapshotFastly provides an advanced edge cloud computing platform that enables developers to build, secure, and deliver digital experiences at the internet's edge, with primary revenue derived from Infrastructure as a Service (IaaS) offerings across global markets, including North America, Asia Pacific, and Europe.The company operates a subscription-based business model where customers pay for access to its customizable edge cloud platform, which manages, distributes, and safeguards client applications across a distributed global network infrastructure.Fastly serves technology-driven enterprises and digital-native businesses that require high-performance content delivery, application acceleration, and security capabilities at the network edge.

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Fastly is a specialized edge cloud infrastructure provider with a market capitalization of $4.7 billion and TTM revenue of $687 million, positioning it as a significant player in the application delivery and edge computing segment.

The company's platform is optimized for web and application delivery, offering developers a highly customizable solution to optimize performance and security at the internet's edge.

Despite current net losses, Fastly's strong revenue growth trajectory and strategic focus on the expanding edge computing market underscore its competitive positioning in the infrastructure software sector.

What this transaction means for investorsInvestors shouldn't be concerned about this sale. It represented a very small percentage of the insider's stake in the company's stock. Moreover, it was executed under a commonly used Rule 10b5-1 plan, which allows insiders to execute pre-planned transactions without appearing to act on material non-public information.

Fastly's business continues to expand. TTM revenue grew 20% year over year. The company is having success cross-selling and upselling its products to existing customers.

On a GAAP basis, it's still unprofitable, but the company has reported narrowing operating losses since 2022. On an adjusted (non-GAAP) basis, the company posted a $27 million operating profit last quarter. This marks four consecutive quarters of profitability on an adjusted basis.

The stock has climbed about 300% over the last year. Analysts expect Fastly's adjusted earnings to grow at a compound annual rate of 30% in the coming years.

John Ballard has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Fastly. The Motley Fool has a disclosure policy.

Momentum investing is all about the idea of following a stock's recent trend, which can be in either direction. In the "long context," investors will essentially be "buying high, but hoping to sell even higher." And for investors following this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving in that direction. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.

While many investors like to look for momentum in stocks, this can be very tough to define. There is a lot of debate surrounding which metrics are the best to focus on and which are poor quality indicators of future performance. The Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.

Below, we take a look at Fastly (FSLY - Free Report) , which currently has a Momentum Style Score of A. We also discuss some of the main drivers of the Momentum Style Score, like price change and earnings estimate revisions.

It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Fastly currently has a Zacks Rank of #2 (Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of "A or B" outperform the market over the following one-month period.

You can see the current list of Zacks #1 Rank Stocks here >>>

Set to Beat the Market? In order to see if FSLY is a promising momentum pick, let's examine some Momentum Style elements to see if this cloud software developer holds up.

A good momentum benchmark for a stock is to look at its short-term price activity, as this can reflect both current interest and if buyers or sellers currently have the upper hand. It is also useful to compare a security to its industry, as this can help investors pinpoint the top companies in a particular area.

For FSLY, shares are up 1.32% over the past week while the Zacks Internet - Software industry is up 4.29% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 42.65% compares favorably with the industry's 0.37% performance as well.

While any stock can see its price increase, it takes a real winner to consistently beat the market. That is why looking at longer term price metrics -- such as performance over the past three months or year -- can be useful as well. Over the past quarter, shares of Fastly have risen 66.65%, and are up 294.06% in the last year. On the other hand, the S&P 500 has only moved 4.93% and 21.47%, respectively.

Investors should also pay attention to FSLY's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. FSLY is currently averaging 6,834,381 shares for the last 20 days.

Earnings OutlookThe Zacks Momentum Style Score also takes into account trends in estimate revisions, in addition to price changes. Please note that estimate revision trends remain at the core of Zacks Rank as well. A nice path here can help show promise, and we have recently been seeing that with FSLY.

Over the past two months, 6 earnings estimates moved higher compared to none lower for the full year. These revisions helped boost FSLY's consensus estimate, increasing from $0.32 to $0.53 in the past 60 days. Looking at the next fiscal year, 6 estimates have moved upwards while there have been no downward revisions in the same time period.

Bottom LineGiven these factors, it shouldn't be surprising that FSLY is a #2 (Buy) stock and boasts a Momentum Score of A. If you're looking for a fresh pick that's set to soar in the near-term, make sure to keep Fastly on your short list.

On CNBC’s “Mad Money Lightning Round,” Jim Cramer said he likes Vistra Corp. (NYSE:VST) and also likes Constellation Energy Corporation (NASDAQ:CEG). “I think these things are oversold and they make a ton of sense,” he added.

Vistra, on Aug. 7, reported second-quarter revenue and earnings that missed Wall Street estimates, even as it posted stronger adjusted EBITDA growth and reaffirmed its full-year outlook.

When asked about Recursion Pharmaceuticals, Inc. (NASDAQ:RXRX), he said, “I think that company better come up with something soon because right now all it is coming up with is losses, and that is not the way it should be.”

On the earnings front, Recursion Pharmaceuticals, on Aug. 5, reported worse-than-expected second-quarter financial results.

Cramer senses “trouble” with NextEra Energy, Inc. (NYSE:NEE), which, on July 24, reported mixed second-quarter results. The Juno Beach, Florida-based company reaffirmed full-year adjusted EPS guidance.

“This President [Trump] seems to be inclined to be able to give the Navy a lot of money, and I think that’s the only game in town,” Cramer said when asked about shipbuilder Huntington Ingalls Industries, Inc. (NYSE:HII).

On the earnings front, Huntington Ingalls, on July 30, reported better-than-expected second-quarter financial results and raised its FY26 sales guidance above estimates.

When asked about Fastly, Inc. (NASDAQ:FSLY), he said, “That thing came back from the abyss. I have to tell you, I still like Cloudflare (NYSE:NET) more, but I hand it to those guys. I also like Akamai (NASDAQ:AKAM), but Fastly’s in the game, and it’s not easy to be in that game.”

Fastly, on Aug. 5, reported quarterly earnings of 15 cents per share, which beat the analyst consensus estimate of seven cents, according to Benzinga Pro data.

Price Action Recursion Pharmaceuticals shares fell 1.8% to settle at $3.29 on Wednesday. Fastly shares fell 0.9% to close at $28.53 during the session. Nextera rose 0.1% to settle at $85.78 on Wednesday. Huntington Ingalls shares fell 0.3% to close at $326.80. Vistra shares gained 1.2% to settle at $146.68. Read Next

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3 Beaten-Down Small Caps Building Momentum for a 2025 RallyFastly NASDAQ: FSLY executives outlined the company’s efforts to broaden its security portfolio, improve go-to-market execution and capitalize on demand related to artificial intelligence at KeyBanc Capital Markets’ Technology Leadership Forum.

Rich Wong, Fastly’s chief financial officer, said the company operates as an Edge Cloud provider, offering content delivery, security, compute and observability services designed to make internet applications faster, more reliable and safer. He said Fastly’s strategy is centered on pairing its edge capabilities with customers’ central-cloud environments.

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MarketBeat Week in Review – 11/6 - 11/10Wong, who marked his one-year anniversary with Fastly, said he joined because he believed the company had strong technology but needed to improve execution and expand its product offerings. He pointed to leadership changes under Chief Executive Officer Kip Compton and go-to-market initiatives led by Scott Lovett as important elements of the company’s recent progress.

Security portfolio and sales execution Wong said Fastly previously had a single security offering, its web application firewall, or WAF, which originated with the company’s 2020 acquisition of Signal Sciences. After integrating that technology into Fastly’s network, the company expanded its security lineup to include distributed denial-of-service protection, bot management, API security and client-side protection.

Fastly shifts into the fast lane toward profits “Having that full suite enabled us to really be a true security player versus just a single security product,” Wong said.

He said the broader portfolio has changed customer discussions from conversations centered solely on content delivery networks to conversations involving the full set of delivery and security products. According to Wong, security products such as DDoS protection, WAF and bot management can also be necessary for Fastly to participate in certain content-delivery requests for proposals.

Lovett, who joined in mid-2024, elevated Fastly’s go-to-market organization by bringing in sales personnel with security experience and changing compensation plans, Wong said. He added that sales and marketing expense at the end of 2025 was lower than it had been during 2024, while the company generated an additional $80 million to $90 million of year-over-year revenue.

Fastly reported 23.3% year-over-year revenue growth in its latest quarter, Wong said, marking its third consecutive quarter with growth above 20%. He also cited 65.8% gross margin, $27 million in operating profit, four consecutive quarters of operating profit and six consecutive quarters of free-cash-flow generation.

Customer concentration and retention Vern Essi, Fastly’s vice president of investor relations, said investors have responded positively to the company’s increased revenue diversification, security momentum and top-line growth. He said some investors have also raised concerns about customer concentration, with Fastly’s top 10 customers accounting for approximately 26% of revenue.

Essi said the company remains comfortable with its ability to grow its largest-customer cohort while continuing to expand other parts of the business. He also highlighted a trailing-12-month net retention rate of 117%, which he described as a four-year high for the company.

Fastly’s “other” revenue category, which includes compute, grew 70% year over year, Essi said. That category generated roughly $8 million in revenue during the latest quarter, according to Wong.

AI opportunities centered on security and edge compute Executives said AI is creating opportunities across Fastly’s business, although they characterized some areas as early-stage. Essi said the most immediate AI-related growth vector has been bot management, including the company’s ContentGuard product.

Fastly has publicly discussed a win with French media organization Le Monde, which uses ContentGuard to identify and manage automated agents accessing its network, Essi said. The product can help customers determine whether to reject agents or permit access, including in cases where a customer has an existing relationship with the organization behind the agent.

Wong said AI traffic can generate high numbers of requests, though it often involves lower amounts of delivered data. Customers have not pushed back significantly on the associated delivery traffic, he said, because they view AI visibility as potentially beneficial to brand exposure and customer discovery.

“AI is now the new SEO,” Wong said, referring to search-engine optimization.

Fastly is also discussing agentic compute workloads with customers, but Essi said it remains too early to determine the scale of that opportunity. The company does not plan to build a GPU-focused “neocloud,” he said, arguing that Fastly’s edge positioning and open cloud platform provide a more attractive approach without requiring large capital investments in graphics-processing-unit infrastructure.

Capital efficiency and greater revenue visibility Wong said Fastly’s single network supports both delivery and security products, including the acquired Signal Sciences WAF. He said that architecture contributes to capital efficiency compared with competitors that may operate separate networks for different product categories.

The company changed its server depreciation cycle from five years to six years earlier this year, citing longer equipment life. Wong said Fastly’s infrastructure capital-expenditure guidance is 10% to 12% of revenue, with spending in 2026 weighted toward the first half after the company ordered components early amid supply-shortage concerns. He said much of the infrastructure spending is directed toward new points of presence in regions including Latin America and Southeast Asia.

While Fastly remains a consumption-based business, Wong said the company has increased revenue visibility through larger customer commitments. He cited year-over-year growth of 38% in remaining performance obligations and 44% in current remaining performance obligations.

About Fastly (NASDAQ:FSLY)Fastly, Inc operates an edge cloud platform designed to accelerate, secure and enable modern digital experiences. The company offers a suite of services including a content delivery network (CDN), edge compute, load balancing, web application firewall (WAF) and DDoS protection. Fastly’s real-time architecture allows customers to seamlessly deploy software logic at the network edge, reducing latency by bringing applications and content closer to end users.

Founded in 2011 by Artur Bergman, Fastly has evolved from a pure-play CDN provider into a comprehensive edge cloud platform.

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Fastly (NYSE:FSLY) stock is surging Monday afternoon, changing hands up 21% to $27.69 in midday trading. The move is one of the largest single-day rallies of the year for the edge-cloud provider, pushing Fastly shares to their highest levels since early 2024.

The rally is a delayed reaction to Q2 2026 results reported after the close on August 5, when Fastly stock initially traded roughly flat. Today’s surge appears to be the market catching up, helped by fresh analyst target hikes and a broad bounce across AI-cloud names.

Coming into today, Fastly stock was already up 41% over the past month and up 171% year to date (YTD), so momentum was already building before the breakout confirmed itself.

Q2 Beat and Raised Guidance Finally Get Their Due Fastly’s Q2 report ticked every box investors wanted. Revenue landed at $183.3 million, up 23.3% year over year (YoY), comfortably ahead of the roughly $174 million expected. The company’s adjusted EPS came in at $0.15 versus the $0.0663 estimate, representing a fifth straight beat.

The profitability metrics stood out. Fastly delivered a record non-GAAP gross margin of 65.8%, adjusted EBITDA of $38.1 million, and net retention of 117%. The company’s Security segment grew 43% to $41.7 million, now a meaningful share of the mix.

Fastly’s management raised the company’s full-year outlook to $732 million to $746 million in revenue (up from about $717.5 million prior) and $0.50 to $0.54 in adjusted EPS. CEO Kip Compton declared, “Our platform strategy is driving business momentum, giving us the confidence to raise our full-year outlook.”

Analyst reactions helped power today’s move. Evercore ISI reiterated an Outperform for FSLY stock with a $32 price target, and KeyBanc stayed bullish with a $30 target. Coverage notes flag Fastly trading around 6x price-to-sales versus Cloudflare (NYSE:NET | NET Price Prediction) above roughly 49x, a valuation gap that the bulls see closing.

AI-Cloud Peers Join the Rally, With One Exception The broader AI-cloud complex is bid up today. Datadog (NASDAQ:DDOG) stock is up 9% to $255.93, rebounding after selling off 19% following its August 6 report. Datadog’s Q3 guide implied a sharp deceleration tied to its largest customer (widely believed to be OpenAI) trimming usage after a nine-figure renewal. Bank of America reiterated Buy with a $305 target, arguing growth outside that account is accelerating to the high-20s in percentage points.

Cloudflare shares are up 2% to $306.77 on sector tailwinds rather than a company-specific catalyst. Oracle (NYSE:ORCL) stock is up 3% to $150.88 on the same AI-cloud theme. The First Trust Cloud Computing ETF (NASDAQ:SKYY) is up 3% to $160.95, a clean sector proxy that holds all four names, and reflects the breadth of today’s cloud bid. It is a concentrated, unleveraged thematic fund, so sector-specific risk applies.

CoreWeave (NASDAQ:CRWV) stock is the laggard, down 2% to $89.09. The AI infrastructure firm reports earnings after tomorrow’s close on August 11, and pre-earnings de-risking plus a run of insider Rule 10b5-1 sales are keeping shares in check.

What to Watch Next The immediate question is whether Fastly stock can hold above the $27 level into the close, or whether some of today’s gains fade as traders take profits on a move this large. A close near the highs would extend the technical breakout.

The next scheduled catalyst for the AI-cloud cohort is CoreWeave’s report tomorrow afternoon. Investors can watch for how CoreWeave’s backlog conversion and margin commentary shape sentiment across the group, including whether Fastly’s momentum carries through the week.

Contact [email protected] for any questions or corrections.

Key Takeaways Fastly beat Q2 estimates as revenues rose 23%, led by Security, Network Services and Compute.Fastly's Security revenues jumped 43%, driven by DDoS protection and bot management growth.FSLY raised 2026 revenue guidance to $732-$746 million and EPS outlook to 50-54 cents. Fastly (FSLY - Free Report) reported second-quarter 2026 adjusted earnings of 15 cents per share versus a loss of 3 cents a year ago. The figure topped the Zacks Consensus Estimate by 114.29%.

Revenues rose 23.3% year over year to $183.32 million and surpassed the consensus mark by 5.34%. Strength across Network Services, Security and Compute supported the upside, while the last-12-month net retention rate climbed to 117%.

FSLY's Platform Strategy Drives Broad GrowthNetwork Services revenues increased 17% year over year to $133.9 million, accounting for 73% of total revenues. Management attributed the performance to higher traffic among its largest customers, along with a smaller contribution from live sporting events.

Fastly also said it is gaining share where performance is critical. The company highlighted major global sporting events that generated record traffic and cited customer wins tied to resilience, flexibility and consolidated edge services.

Fastly's Security Momentum Lifts Revenue MixSecurity revenues advanced 43% year over year to $41.7 million and represented 23% of revenues, up from 20% a year earlier. Management said DDoS protection and bot management grew at triple-digit rates, while its next-generation web application firewall continued to gain traction.

Other revenues, which include Compute and Observability, climbed 69% to $7.7 million. Compute demand benefited from customers building low-latency applications and managing artificial intelligence (AI)-related traffic, supporting a combined Security and Other annual revenue run rate of nearly $200 million.

Fastly's Platform Strategy Gains TractionManagement said customers are adopting more products on Fastly’s unified platform, strengthening cross-sell and upsell activity. The company highlighted triple-digit growth in DDoS protection and bot management, while its web application firewall continued to gain traction.

AI-generated and agentic traffic also remained a demand catalyst. Fastly noted that machine traffic requires real-time decisions around authorization, caching, throttling and blocking, supporting adoption across Security, Compute and Network Services.

The company expanded its product reach through a partnership with Skyfire, designed to verify AI-agent identities and enable transactions at the edge. It also released a C++ software development kit for Fastly Compute to support low-latency AI, gaming and other workloads.

Fastly also highlighted its collaboration with LALIGA on an AI-driven system that detects and stops pirated streams in real time. The project illustrates how the company is pairing content delivery with security and edge-compute capabilities.

FSLY's Customer Metrics Show Deeper AdoptionThe last-12-month net retention rate improved from 113% in the first quarter and 104% in the year-ago quarter. The increase reflected broader product adoption and higher usage across a range of customers as Fastly expanded cross-selling and upselling efforts.

Large customer count was 624 at the end of the quarter. Average annualized spend per large customer was $1.11 million, reflecting broader use of the platform across delivery, security and emerging edge-compute workloads.

The top 10 customers represented 37% of revenues. Revenues from this group grew 48% year over year, while revenues from customers outside the top 10 increased 12%. Remaining performance obligations climbed 38% to $341 million, with the current portion rising 44%.

Fastly Expands Margins & Operating LeverageNon-GAAP gross margin expanded 680 basis points year over year to a record 65.8%. Management attributed the improvement to higher revenues relative to infrastructure costs and continued cost discipline.

Non-GAAP operating expenses were $93.7 million. Non-GAAP operating income totaled $27 million compared with an operating loss of $4.6 million a year ago. Adjusted EBITDA increased to $38.1 million from $8.9 million, while adjusted EBITDA margin reached 21%.

FSLY’s Balance Sheet DetailsAs of June 30, 2026, cash, cash equivalents, marketable securities and investments totaled approximately $337 million, up $7 million from March 31, 2026. Fastly ended the quarter with a positive net cash balance of $14 million.

Net cash provided by operating activities was $39.3 million, compared with $25.8 million a year earlier. Free cash flow totaled $3.6 million versus $10.9 million in the prior-year quarter, as infrastructure capital expenditures represented approximately 17% of revenues.

FSLY Raises 2026 Outlook, Sees AI as TailwindFor the third quarter of fiscal 2026, FSLY expects revenues to be in the range of $184-$190 million and non-GAAP earnings of 11-13 cents per share. The company projects non-GAAP operating income of $20-$24 million.

Fastly raised its 2026 revenue guidance to $732-$746 million and non-GAAP earnings outlook to 50-54 cents per share. Non-GAAP operating income is expected between $88 million and $96 million, reflecting an operating margin of approximately 12% at the midpoint.

Management views AI-driven demand as a tailwind across the business. AI tool usage is contributing to traffic growth among some of Fastly’s fastest-growing customers, with the impact most pronounced in Security and Compute and also evident in Network Services.

The company expects growing machine and agent-driven traffic to increase demand for products such as bot management and DDoS protection. These offerings help customers distinguish authorized traffic from unwanted activity and govern automated requests in real time.

Zacks Rank & Stocks to ConsiderCurrently, Fastly carries a Zacks Rank #3 (Hold).

Some top-ranked stocks in the broader Zacks Computer and Technology sector include Kimball Electronics (KE - Free Report) , NVIDIA (NVDA - Free Report) and Inuvo (INUV - Free Report) . Each stock currently sports a Zacks Rank of 1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Shares of Kimball Electronics have declined 3.9% in the year-to-date period. KE is set to report the fourth quarter of fiscal 2026 results on Aug. 12.

Shares of NVIDIA have increased 18% in the year-to-date period. NVDA is slated to report second-quarter 2026 results on Aug. 26.

Inuvo shares have declined 56% in the year-to-date period. INUV is set to report first-quarter fiscal 2027 results on Aug. 11.

On August 05, 2026, Fastly Inc (FSLY) shares rose 4.3% today, closing at $26.00. The stock has experienced significant volatility over the past year, with a 52-

Fastly (FSLY - Free Report) reported $183.32 million in revenue for the quarter ended June 2026, representing a year-over-year increase of 23.3%. EPS of $0.15 for the same period compares to -$0.03 a year ago.

The reported revenue compares to the Zacks Consensus Estimate of $174.03 million, representing a surprise of +5.34%. The company delivered an EPS surprise of +114.29%, with the consensus EPS estimate being $0.07.

While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health.

As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately.

Here is how Fastly performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

Enterprise customer count/ Large customer count: 624 versus 642 estimated by two analysts on average.Revenue by Product- Network Services: $133.9 million compared to the $126.63 million average estimate based on three analysts. The reported number represents a change of +16.5% year over year.Revenue by Product- Other: $7.7 million versus the three-analyst average estimate of $8.41 million. The reported number represents a year-over-year change of +71.1%.Revenue by Product- Security: $41.7 million compared to the $39.22 million average estimate based on three analysts. The reported number represents a change of +42.3% year over year.View all Key Company Metrics for Fastly here>>>

Shares of Fastly have returned +34.2% over the past month versus the Zacks S&P 500 composite's +3.5% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.

SAN FRANCISCO--(BUSINESS WIRE)--Fastly, Inc. (NASDAQ: FSLY), a leader in global edge cloud platforms, today announced financial results for its second quarter ended June 30, 2026.

"Record second quarter results reflect strong execution and the deep trust customers place in our technology and our teams," said Kip Compton, CEO of Fastly. "Our platform strategy is driving business momentum, giving us the confidence to raise our full-year outlook."

($ in thousands, except per share data) (unaudited)

Three months ended
June 30,

Six months ended
June 30,

2026

2025

2026

2025

Revenue

$

183,317

$

148,709

$

356,338

$

293,183

Gross margin

GAAP gross margin

63.3

%

54.5

%

62.9

%

53.9

%

Non-GAAP gross margin(1)

65.8

%

59.0

%

65.5

%

58.2

%

Operating loss

GAAP operating loss

$

(14,433

)

$

(36,943

)

$

(38,328

)

$

(75,122

)

Non-GAAP operating income (loss)(1)

$

26,993

$

(4,594

)

$

46,136

$

(10,439

)

Net income (loss) per share

GAAP net loss per common share — basic and diluted

$

(0.10

)

$

(0.26

)

$

(0.23

)

$

(0.53

)

Non-GAAP net income (loss) per common share — basic(1)

$

0.17

$

(0.03

)

$

0.32

$

(0.08

)

Non-GAAP net income (loss) per common share — diluted(1)

$

0.15

$

(0.03

)

$

0.28

$

(0.08

)

For a reconciliation of non-GAAP financial measures to their corresponding GAAP measures, please refer to the reconciliation table at the end of this press release.

Second Quarter 2026 Financial Summary

Total revenue of $183.3 million, representing 23% year-over-year growth. Network Services revenue of $133.9 million, representing 17% year-over-year growth. Security revenue of $41.7 million, representing 43% year-over-year growth. Other revenue of $7.7 million, representing 69% year-over-year growth. Network Services revenue includes solutions designed to improve performance of websites, apps, APIs, and digital media. Security revenue includes products designed to protect websites, apps, APIs, and users. Other revenue includes Compute and Observability solutions. Generated $39.3 million of operating cash flow compared to $25.8 million of operating cash flow in the second quarter of 2025. Generated $3.6 million of positive free cash flow compared to $10.9 million in the second quarter of 2025. GAAP gross margin of 63.3%, compared to 54.5% in the second quarter of 2025. Non-GAAP gross margin1 of 65.8%, compared to 59.0% in the second quarter of 2025. GAAP net loss of $15.6 million, compared to $37.5 million in the second quarter of 2025. Non-GAAP net income1 of $26.2 million, compared to non-GAAP net loss1 of $5.0 million in the second quarter of 2025. GAAP net loss per basic and diluted share of $0.10, compared to $0.26 in the second quarter of 2025. Non-GAAP net income per basic share1 of $0.17, compared to non-GAAP net loss per basic share1 of $0.03 in the second quarter of 2025. Non-GAAP net income per diluted share1 of $0.15, compared to non-GAAP net loss per diluted share1 of $0.03 in the second quarter of 2025. Key Metrics

Remaining Performance Obligations (RPO)2 were $341 million, up 38% from $247 million in the second quarter of 2025. Fastly's top ten customers accounted for 37% of revenue in the second quarter of 2026 compared to 31% in the second quarter of 2025. Last 12-month net retention rate (LTM NRR)3 increased to 117% in the second quarter from 113% in the first quarter of 2026. Second Quarter Business and Product Highlights

Announced new research showing how rapidly growing AI traffic is reshaping the internet, growing 6.5x faster than human traffic this year, and why organizations need new strategies to manage machine traffic. Released a joint announcement with LALIGA on the collaboration of anti-piracy solutions that are designed to address illegal streaming of live sports and help rights holders prevent lost revenue. Announced a new partnership with Skyfire, enabling trusted commerce at the edge so enterprises can now securely identify, verify, and transact with AI agents in real time and at global scale, without re-architecting existing infrastructure. Released C++ SDK for Fastly Compute, enabling enterprises to secure, scale, and accelerate their C++ AI workloads, gaming features, and other low-latency applications. Third Quarter and Full Year 2026 Guidance

Q3 2026

Full Year 2026

Total Revenue (millions)

$184.0 - $190.0

$732.0 - $746.0

Non-GAAP Operating Income (millions)

$20.0 - $24.0

$88.0 - $96.0

Non-GAAP Net Income per share(4)(5)

$0.11 - $0.13

$0.50 - $0.54

A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty of expenses that may be incurred in the future and cannot be reasonably determined or predicted at this time, although it is important to note that these factors could be material to Fastly’s future GAAP financial results.

Conference Call Information

Fastly will host an investor conference call to discuss its results at 1:30 p.m. PT / 4:30 p.m. ET on Wednesday, August 5, 2026.

To access the conference call, please pre-register and dial-in using this link at least 15 minutes prior to the 1:30 p.m. PT start time. Registrants will receive an email confirmation with dial-in details.

A live webcast of the event can be accessed using this link. A replay of the webcast will be available on https://investors.fastly.com starting approximately two hours after the event and archived on the site for one quarter.

About Fastly, Inc.

Fastly’s powerful and programmable edge cloud platform helps the world’s top brands deliver online experiences that are fast, safe, and engaging through edge compute, delivery, security, and observability offerings that improve site performance, enhance security, and empower innovation at global scale. Compared to other providers, Fastly’s powerful, high-performance, and modern platform architecture empowers developers to deliver secure websites and apps with rapid time-to-market and demonstrated, industry-leading cost savings. Organizations around the world trust Fastly to help them upgrade the internet experience, including Reddit, Universal Music Group, and SeatGeek. Learn more about Fastly at https://www.fastly.com, and follow us @fastly.

Forward-Looking Statements

This press release contains “forward-looking” statements that are based on our beliefs and assumptions and on information currently available to us. Forward-looking statements may involve known and unknown risks, uncertainties, and other factors that may cause our actual results, performance, or achievements to be materially different from those expressed or implied by the forward-looking statements. These statements include, but are not limited to, statements regarding our future financial and operating performance and shareholder returns, including our outlook and guidance and ability to maintain and strengthen our liquidity position; our ability to acquire new customers, expand cross-sell opportunities, and grow market share; our ability to enrich our revenue mix with platform enhancements; the performance of our existing and new platform enhancements; our ability to accelerate global growth; our partnerships and collaborations; the performance, capabilities, and expectations regarding customer experiences with Fastly Compute, including its C++ SDK, Bot Management and DDoS Protection, and Next-Gen WAF; and Fastly's strategies, platform, and business plans. Except as required by law, we assume no obligation to update these forward-looking statements publicly or to update the reasons actual results could differ materially from those anticipated in the forward-looking statements, even if new information becomes available in the future. Important factors that could cause our actual results to differ materially are detailed from time to time in the reports Fastly files with the Securities and Exchange Commission (“SEC”), including those more fully described in Fastly’s Annual Report on Form 10-K for the year ended December 31, 2025. Additional information will also be set forth in Fastly’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2026, and other filings and reports that Fastly may file from time to time with the SEC. Copies of reports filed with the SEC are posted on Fastly’s website and are available from Fastly without charge.

Use of Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with accounting principles generally accepted in the United States (“GAAP”), the Company uses the following non-GAAP measures of financial performance: non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income (loss), non-GAAP net income (loss), non-GAAP basic and diluted net income (loss) per common share, non-GAAP research and development, non-GAAP sales and marketing, non-GAAP general and administrative, free cash flow and adjusted EBITDA. The presentation of this additional financial information is not intended to be considered in isolation from, as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. These non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our results of operations as determined in accordance with GAAP. In addition, these non-GAAP financial measures may be different from the non-GAAP financial measures used by other companies. These non-GAAP measures should only be used to evaluate our results of operations in conjunction with the corresponding GAAP measures. Management compensates for these limitations by reconciling these non-GAAP financial measures to the most comparable GAAP financial measures within our earnings releases.

Non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating income (loss), non-GAAP net income (loss) and non-GAAP basic and diluted net income (loss) per common share, non-GAAP research and development, non-GAAP sales and marketing, and non-GAAP general and administrative differ from GAAP in that they exclude stock-based compensation expense and related employer payroll taxes, amortization of capitalized stock-based compensation - cost of revenue, amortization of acquired intangible assets, executive transition costs, and amortization of debt discount and issuance costs.

Adjusted EBITDA: excludes stock-based compensation expense and related employer payroll taxes, amortization of capitalized stock-based compensation - cost of revenue, gain on modification of lease, depreciation and other amortization expenses, amortization of acquired intangible assets, impairment expense, executive transition costs, interest income, interest expense, including amortization of debt discount and issuance costs, other expense (income), net, and income taxes.

Amortization of Acquired Intangible Assets: consists of non-cash charges that can be affected by the timing and magnitude of asset purchases and acquisitions. Management considers its operating results without this activity when evaluating its ongoing non-GAAP performance and its adjusted EBITDA performance because these charges are non-cash expenses that can be affected by the timing and magnitude of asset purchases and acquisitions and may not be reflective of our core business, ongoing operating results, or future outlook.

Amortization of Debt Discount and Issuance Costs: consists primarily of amortization expense related to our debt obligations. Management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook. These are included in our total interest expense.

Capital Expenditures: consists of cash used for purchases of property and equipment, net of proceeds from sale of property and equipment, capitalized internal-use software and payments on finance lease obligations, as reflected in our statement of cash flows.

Depreciation and Other Amortization Expense: consists of non-cash charges that can be affected by the timing and magnitude of asset purchases. Management considers its operating results without this activity when evaluating its ongoing adjusted EBITDA performance because these charges are non-cash expenses that can be affected by the timing and magnitude of asset purchases and may not be reflective of our core business, ongoing operating results, or future outlook.

Executive Transition Costs: consists of one-time cash charges recognized with respect to changes in our executive’s employment status. Management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results, or future outlook.

Free Cash Flow: calculated as net cash used in operating activities less purchases of property and equipment, net of proceeds from sale of property and equipment, and capitalized internal-use software costs. Management specifically identifies adjusting items in the reconciliation of GAAP to non-GAAP financial measures. Management considers non-GAAP free cash flow to be a profitability and liquidity measure that provides useful information to management and investors about the amount of cash generated by the business that can possibly be used for investing in Fastly's business and strengthening its balance sheet, but it is not intended to represent the residual cash flow available for discretionary expenditures. The presentation of non-GAAP free cash flow is also not meant to be considered in isolation or as an alternative to cash flows from operating activities as a measure of liquidity.

Gain on Modification of Lease: consists of a one-time non-cash charge recognized with respect to the modification of our leases. Management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results, or future outlook.

Impairment Expense: consists of charges related to our long-lived assets. Management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook.

Income Taxes: consists primarily of expenses recognized related to state and foreign income taxes. Management considers its operating results without this activity when evaluating its ongoing adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook.

Interest Expense: consists primarily of interest expense related to our debt instruments, including amortization of debt discount and issuance costs. Management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook.

Interest Income: consists primarily of interest income related to our marketable securities. Management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook.

Other (Expense) Income, Net: consists primarily of foreign currency transaction gains and losses. Management considers its operating results without this activity when evaluating its ongoing adjusted EBITDA performance because it is not believed by management to be reflective of our core business, ongoing operating results or future outlook.

Stock-Based Compensation Expense and Related Employer Payroll Taxes: consists of expenses for stock options, restricted stock units, performance awards and other shares issued under our equity incentive plans or our Employee Stock Purchase Plan ("ESPP"), as applicable, and the related employer payroll taxes. Although stock-based compensation and its related employer payroll taxes are expenses for the Company, management considers its operating results without this activity when evaluating its ongoing non-GAAP net income (loss) performance and its adjusted EBITDA performance, primarily because they are expenses not believed by management to be reflective of our core business, ongoing operating results, or future outlook. In addition, the value of some stock-based instruments is determined using formulas that incorporate variables, such as market volatility, that are beyond our control.

Amortization of Capitalized Stock-Based Compensation - Cost of Revenue: in order to reflect the performance of our core business, ongoing operating results, or future outlook, and to be consistent with the way many investors evaluate our performance and compare our operating results to peer companies, similar to stock-based compensation, management considers it appropriate to exclude amortization of capitalized stock-based compensation from our non-GAAP financial measures.

Management believes these non-GAAP financial measures and adjusted EBITDA serve as useful metrics for our management and investors because they enable a better understanding of the long-term performance of our core business and facilitate comparisons of our operating results over multiple periods and to those of peer companies, and when taken together with the corresponding GAAP financial measures and our reconciliations, enhance investors' overall understanding of our current financial performance.

In the financial tables below, the Company provides a reconciliation of the most comparable GAAP financial measure to the historical non-GAAP financial measures used in this press release.

Key Metrics

1 Beginning with the quarter ended March 31, 2026, we are excluding stock-based compensation related employer payroll taxes from our non-GAAP gross margin, non-GAAP operating income (loss), non-GAAP net income (loss) per common share — basic and non-GAAP net income (loss) per common share — diluted, because we consider our operating results without this activity when evaluating our ongoing non-GAAP net income (loss) performance and our adjusted EBITDA performance. We did not recast the presentation for all prior periods presented due to the immaterial amount of such payroll taxes.

2 Remaining Performance Obligations include future committed revenue for periods within current contracts with customers, as well as deferred revenue arising from consideration invoiced for which the related performance obligations have not been satisfied. During the third quarter of 2025, we identified an error in RPO calculations from certain contracts with a termination-for-convenience clause. We recast the presentation of RPO for all prior periods presented to reflect the correction of this error.

3 We calculate LTM Net Retention Rate by dividing the total customer revenue for the prior twelve-month period (“prior 12-month period”) ending at the beginning of the last twelve-month period (“LTM period”) minus revenue contraction due to billing decreases or customer churn, plus revenue expansion due to billing increases during the LTM period from the same customers by the total prior 12-month period revenue. We believe the LTM Net Retention Rate is supplemental as it removes some of the volatility that is inherent in a usage-based business model.

4 Non-GAAP net income per share is calculated as Non-GAAP net income divided by weighted average diluted shares for 2026.

5 Assumes weighted average diluted shares outstanding of 181.4 million in Q3 2026 and 180.3 million for the full year 2026.

  Condensed Consolidated Statements of Operations

(unaudited, in thousands, except per share amounts)

  Three months ended
June 30,

Six months ended
June 30,

2026

2025

2026

2025

Revenue

$

183,317

$

148,709

$

356,338

$

293,183

Cost of revenue(1)

67,366

67,593

132,206

135,269

Gross profit

115,951

81,116

224,132

157,914

Operating expenses:

Research and development(1)

42,071

42,221

84,043

79,650

Sales and marketing(1)

56,735

51,100

111,849

100,413

General and administrative(1)

31,578

24,323

66,568

52,558

Impairment expense

—

415

—

415

Total operating expenses

130,384

118,059

262,460

233,036

Loss from operations

(14,433

)

(36,943

)

(38,328

)

(75,122

)

Interest income

2,842

3,084

5,769

6,059

Interest expense

(3,348

)

(3,164

)

(6,654

)

(6,337

)

Other (expense) income, net

(400

)

39

(780

)

(41

)

Loss before income taxes

(15,339

)

(36,984

)

(39,993

)

(75,441

)

Income tax expense (benefit)

252

557

(3,878

)

1,248

Net loss

$

(15,591

)

$

(37,541

)

$

(36,115

)

$

(76,689

)

Net loss per share attributable to common stockholders, basic and diluted

$

(0.10

)

$

(0.26

)

$

(0.23

)

$

(0.53

)

Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted

157,596

145,780

155,598

144,539

________________ (1) Includes stock-based compensation expense as follows:

Three months ended
June 30,

Six months ended
June 30,

2026

2025

2026

2025

Cost of revenue

$

2,757

$

2,573

$

5,293

$

4,512

Research and development

11,902

11,755

21,932

20,648

Sales and marketing

10,344

8,176

19,697

14,869

General and administrative

10,169

3,831

23,231

11,888

Total

$

35,172

$

26,335

$

70,153

$

51,917

  Reconciliation of GAAP to Non-GAAP Financial Measures

(unaudited, in thousands, except per share data)

  Three months ended
June 30,

Six months ended
June 30,

2026

2025

2026

2025

Gross profit

GAAP gross profit

$

115,951

$

81,116

$

224,132

$

157,914

Stock-based compensation expense and related employer payroll taxes(1)

3,026

2,573

5,773

4,512

Amortization of capitalized stock-based compensation - Cost of revenue

1,694

1,581

3,383

3,222

Amortization of acquired intangible assets

—

2,475

—

4,950

Non-GAAP gross profit

$

120,671

$

87,745

$

233,288

$

170,598

GAAP gross margin

63.3

%

54.5

%

62.9

%

53.9

%

Non-GAAP gross margin

65.8

%

59.0

%

65.5

%

58.2

%

Research and development

GAAP research and development

$

42,071

$

42,221

$

84,043

$

79,650

Stock-based compensation expense and related employer payroll taxes(1)

(12,967

)

(11,755

)

(24,355

)

(20,648

)

Non-GAAP research and development

$

29,104

$

30,466

$

59,688

$

59,002

Sales and marketing

GAAP sales and marketing

$

56,735

$

51,100

$

111,849

$

100,413

Stock-based compensation expense and related employer payroll taxes(1)

(10,869

)

(8,176

)

(21,009

)

(14,869

)

Amortization of acquired intangible assets

(2,160

)

(2,279

)

(4,319

)

(4,580

)

Executive transition costs

—

—

(262

)

—

Non-GAAP sales and marketing

$

43,706

$

40,645

$

86,259

$

80,964

General and administrative

GAAP general and administrative

$

31,578

$

24,323

$

66,568

$

52,558

Stock-based compensation expense and related employer payroll taxes(1)

(10,710

)

(3,831

)

(24,302

)

(11,888

)

Executive transition costs

—

—

(1,061

)

(335

)

Gain on modification of lease

—

736

—

736

Non-GAAP general and administrative

$

20,868

$

21,228

$

41,205

$

41,071

Operating income (loss)

GAAP operating loss

$

(14,433

)

$

(36,943

)

$

(38,328

)

$

(75,122

)

Stock-based compensation expense and related employer payroll taxes(1)

37,572

26,335

75,439

51,917

Amortization of capitalized stock-based compensation - Cost of revenue

1,694

1,581

3,383

3,222

Executive transition costs

—

—

1,323

335

Gain on modification of lease

—

(736

)

—

(736

)

Amortization of acquired intangible assets

2,160

4,754

4,319

9,530

Impairment expense

—

415

—

415

Non-GAAP operating income (loss)

$

26,993

$

(4,594

)

$

46,136

$

(10,439

)

Net income (loss)

GAAP net loss

$

(15,591

)

$

(37,541

)

$

(36,115

)

$

(76,689

)

Stock-based compensation expense and related employer payroll taxes(1)

37,572

26,335

75,439

51,917

Amortization of capitalized stock-based compensation - Cost of revenue

1,694

1,581

3,383

3,222

Executive transition costs

—

—

1,323

335

Gain on modification of lease

—

(736

)

—

(736

)

Amortization of acquired intangible assets

2,160

4,754

4,319

9,530

Impairment expense

—

415

—

415

Amortization of debt discount and issuance costs

366

217

767

434

Non-GAAP net income (loss)

$

26,201

$

(4,975

)

$

49,116

$

(11,572

)

Non-GAAP net income (loss) per common share — basic

$

0.17

$

(0.03

)

$

0.32

$

(0.08

)

Non-GAAP net income (loss) per common share — diluted

$

0.15

$

(0.03

)

$

0.28

$

(0.08

)

Weighted average basic common shares

157,596

145,780

155,598

144,539

Weighted average diluted common shares

180,304

145,780

178,410

144,539

Reconciliation of GAAP to Non-GAAP Financial Measures (continued)

(unaudited, in thousands, except per share data)

  Three months ended
June 30,

Six months ended
June 30,

2026

2025

2026

2025

Reconciliation of GAAP to Non-GAAP diluted shares

GAAP diluted shares

157,596

145,780

155,598

144,539

Other dilutive equity awards

22,708

—

22,812

—

Non-GAAP diluted shares

180,304

145,780

178,410

144,539

Non-GAAP diluted net income (loss) per share

$

0.15

$

(0.03

)

$

0.28

$

(0.08

)

Three months ended
June 30,

Six months ended
June 30,

2026

2025

2026

2025

Adjusted EBITDA

GAAP net loss

$

(15,591

)

$

(37,541

)

$

(36,115

)

$

(76,689

)

Stock-based compensation expense and related employer payroll taxes(1)

37,572

26,335

75,439

51,917

Amortization of capitalized stock-based compensation - Cost of revenue

1,694

1,581

3,383

3,222

Gain on modification of lease

—

(736

)

—

(736

)

Depreciation and other amortization

11,129

13,505

21,449

27,155

Amortization of acquired intangible assets

2,160

4,754

4,319

9,530

Amortization of debt discount and issuance costs

366

217

767

434

Impairment expense

—

415

—

415

Executive transition costs

—

—

1,323

335

Interest income

(2,842

)

(3,084

)

(5,769

)

(6,059

)

Interest expense

2,982

2,947

5,887

5,903

Other expense (income), net

400

(39

)

780

41

Income tax expense (benefit)

252

557

(3,878

)

1,248

Adjusted EBITDA

$

38,122

$

8,911

$

67,585

$

16,716

Condensed Consolidated Balance Sheets

(unaudited, in thousands)

  As of
June 30, 2026

As of
December 31, 2025

ASSETS

Current assets:

Cash and cash equivalents

$

89,798

$

180,563

Marketable securities

247,700

181,196

Accounts receivable, net of allowance for credit losses

114,216

118,029

Prepaid expenses and other current assets

27,333

26,921

Total current assets

479,047

506,709

Property and equipment, net

220,354

186,785

Operating lease right-of-use assets, net

58,213

52,067

Goodwill

670,356

670,356

Intangible assets, net

21,232

25,771

Other assets

54,441

57,789

Total assets

$

1,503,643

$

1,499,477

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable

$

20,124

$

17,612

Accrued expenses

52,937

70,669

Long-term debt, current

—

38,557

Operating lease liabilities, current

30,100

24,427

Deferred revenue

34,266

35,234

Other current liabilities

5,096

7,499

Total current liabilities

142,523

193,998

Long-term debt, net

323,958

323,282

Operating lease liabilities, non-current

44,234

43,921

Other long-term liabilities

2,111

8,698

Total liabilities

512,826

569,899

Stockholders’ equity:

Common stock

3

3

Additional paid-in capital

2,141,909

2,044,103

Accumulated other comprehensive loss

(493

)

(41

)

Accumulated deficit

(1,150,602

)

(1,114,487

)

Total stockholders’ equity

990,817

929,578

Total liabilities and stockholders’ equity

$

1,503,643

$

1,499,477

  Condensed Consolidated Statements of Cash Flows

(unaudited, in thousands)

  Three months ended
June 30,

Six months ended
June 30,

2026

2025

2026

2025

Cash flows from operating activities:

Net loss

$

(15,591

)

$

(37,541

)

$

(36,115

)

$

(76,689

)

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation expense

12,720

14,962

24,612

30,129

Amortization of intangible assets

2,262

4,878

4,539

9,778

Non-cash lease expense

6,887

5,694

13,085

11,349

Amortization of debt discount and issuance costs

366

217

767

434

Amortization of deferred contract costs

4,733

4,847

9,491

9,697

Stock-based compensation

35,172

26,335

70,153

51,917

Deferred income taxes

(23

)

327

(4,353

)

749

Provision for credit losses

1,014

1,048

2,532

1,994

(Gain) loss on disposals of property and equipment

(9

)

(43

)

267

(43

)

Accretion of discounts and amortization of premiums, net

(1,019

)

(1,356

)

(1,817

)

(1,982

)

Impairment expense

—

415

—

415

Non-cash interest expense

969

969

969

969

Other adjustments

(57

)

(84

)

(275

)

292

Changes in operating assets and liabilities:

Accounts receivable, net

14,807

669

1,281

(3,324

)

Prepaid expenses and other current assets

2,227

121

(412

)

2,337

Other assets

(3,195

)

(6,076

)

(1,845

)

(8,171

)

Accounts payable

1,497

3,446

8,309

6,021

Accrued expenses

(2,651

)

1,577

872

(1,806

)

Operating lease liabilities

(7,114

)

(2,332

)

(12,923

)

(7,888

)

Other liabilities

(13,661

)

7,725

(10,937

)

16,908

Net cash provided by operating activities

39,334

25,798

68,200

43,086

Cash flows from investing activities:

Purchases of marketable securities

(87,262

)

(93,440

)

(266,602

)

(272,926

)

Maturities of marketable securities

24,329

37,836

201,472

45,805

Purchases of property and equipment

(31,623

)

(9,852

)

(52,644

)

(12,457

)

Proceeds from sale of property and equipment

10

44

10

44

Capitalized internal-use software

(4,148

)

(4,542

)

(7,884

)

(9,305

)

Net cash used in investing activities

(98,694

)

(69,954

)

(125,648

)

(248,839

)

Cash flows from financing activities:

Repayment of convertible senior notes

—

—

(38,593

)

—

Payments of other debt issuance costs

—

—

(502

)

—

Repayments of finance lease liabilities

—

(537

)

—

(2,248

)

Proceeds from exercise of vested stock options

92

279

1,135

687

Proceeds from employee stock purchase plan

2,397

1,240

4,676

3,371

Net cash provided by (used in) financing activities

2,489

982

(33,284

)

1,810

Effects of exchange rate changes on cash and cash equivalents

(1

)

177

(33

)

255

Net decrease in cash and cash equivalents

(56,872

)

(42,997

)

(90,765

)

(203,688

)

Cash and cash equivalents at beginning of period

146,670

125,484

180,563

286,175

Cash and cash equivalents at end of period

$

89,798

$

82,487

$

89,798

$

82,487

Free Cash Flow

(unaudited, in thousands)

  Three months ended
June 30,

Six months ended
June 30,

2026

2025

2026

2025

Net cash provided by operating activities

$

39,334

$

25,798

$

68,200

$

43,086

Capital expenditures(1)

(35,761

)

(14,887

)

(60,518

)

(23,966

)

Free Cash Flow

$

3,573

$

10,911

$

7,682

$

19,120

More News From Fastly, Inc.

Shareholders are encouraged to contact the firm to discuss their rights and options at no cost or obligation. We would handle any matter on a contingent fee basis, whereby you would not be responsible for out-of-pocket payment of our legal fees or expenses.

Shareholders should contact the firm immediately as there may be limited time to enforce your rights.

, /PRNewswire/ -- Halper Sadeh LLC, an investor rights law firm, is investigating whether certain officers and directors of Fastly, Inc. (NYSE: FSLY) breached their fiduciary duties to shareholders.

If you currently own Fastly stock and are a long-term shareholder, you may be able to seek corporate governance reforms, the return of funds back to the company, a court-approved financial incentive award, or other relief and benefits. Please click here to learn more about your legal rights and options or contact Daniel Sadeh or Zachary Halper at (212) 763-0060 or [email protected] or [email protected].

Why Your Participation Matters:

Shareholder involvement can help improve a company's policies, practices, and oversight mechanisms to create a more transparent, accountable, and effectively managed organization, which can enhance shareholder value.

Halper Sadeh LLC represents investors all over the world who have fallen victim to securities fraud and corporate misconduct. Our attorneys have been instrumental in implementing corporate reforms and recovering millions of dollars on behalf of defrauded investors.

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SOURCE Halper Sadeh LLP

[url="]Fastly, Inc.[/url] (NASDAQ: FSLY), a leader in global edge cloud platforms, today announced that its management team will be participating at upcoming in

Charles Lacey “Kip” Compton III, CEO of Fastly, Inc. (FSLY +4.48%), sold 18,485 shares of Class A Common Stock on July 16 and July 17, 2026, at a weighted average price of $20.74 per share according to a recent SEC Form 4 filing.

Transaction summaryMetricValueTransaction value~$383,400Shares sold18,485Post-transaction shares (directly held)1,045,460Post-transaction value$21.66 millionTransaction value based on SEC Form 4 weighted average sale price ($20.74); post-transaction value based on July 17, 2026 market close.

Key questionsWhat was the context for this transaction?
The disposal was executed under a Rule 10b5-1 trading plan established on August 27, 2025, which allows insiders to set up a pre-arranged schedule for selling shares to avoid concerns about trading on non-public information.How do the current holdings reflect the insider's long-term commitment?
Despite the sale of 18,485 shares, the CEO continues to hold 1,045,460 shares directly, representing a 0.67% ownership stake in the company. The insider also holds derivative securities that further align his interests with shareholders.How has the company's financial profile evolved leading up to this filing?
Fastly reported trailing twelve-month revenue of $652.6 million and a net loss of $103.1 million, maintaining a market capitalization of $3.2 billion as of the July 17, 2026 close. The stock has delivered a 202% return over the one-year period ending on the transaction date.Company OverviewMetricValueShare Price (as of market close 2026-07-17)$20.72Market Capitalization$3.2 billionRevenue (TTM)$652.6 millionNet Income (TTM)-$103.1 millionCompany SnapshotFastly provides an advanced edge cloud computing platform that enables developers to build, secure, and deliver digital experiences at the internet's edge, with primary revenue derived from Infrastructure as a Service (IaaS) offerings across North America, Asia Pacific, Europe, and international markets.The company operates a subscription-based business model where customers pay for access to its customizable edge cloud platform, which optimizes web and application delivery while providing security and performance management capabilities.Fastly primarily serves enterprise customers, developers, and digital-first organizations that require high-performance content delivery, edge computing, and application security solutions across global markets.Fastly is a specialized edge cloud infrastructure provider, serving as a critical infrastructure partner for enterprises requiring optimized content delivery and edge computing capabilities. The company operates a highly customizable platform designed to address the growing demand for distributed computing resources at the internet's edge, enabling rapid digital experience delivery with integrated security features.

With 1,140 employees, Fastly competes in the infrastructure software market by offering differentiated edge computing capabilities that address latency, performance, and security requirements for modern digital applications.

What this transaction means for investorsThe sale of Fastly stock on July 16 and July 17 does not appear to be a cause for investor concern. The July 16 disposition involved 11,412 shares and these were sold to satisfy tax withholding obligations related to the vesting of restricted stock units.

The remaining 7,073 shares sold by CEO Kip Compton on July 17 was a non-discretionary transaction executed as part of a pre-established Rule 10b5-1 plan. Given he retained over one million shares after this sale, Compton maintains a substantial equity stake in the company.

Although Fastly’s first-quarter earnings report did not impress Wall Street, contributing to the stock falling from a 52-week high of $34.82 in April, the company posted record revenue of $173 million. That represents excellent 20% year-over-year growth.

Even so, Fastly remains unprofitable with a Q1 operating loss of $23.9 million. Yet its price-to-sales ratio of about four is higher than it was a year ago, suggesting the stock’s valuation is elevated, which is likely another contributor to its share price decline.

Robert Izquierdo has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Fastly. The Motley Fool has a disclosure policy.

COSTA MESA, Calif.--(BUSINESS WIRE)--Experian today announced that Fastly (NASDAQ: FSLY), a leading global edge cloud platform, has joined the growing Experian Agent Trust™ ecosystem. Together, the companies will help enterprises verify AI agents, authorize transactions, and make trust decisions in real time as autonomous commerce continues to grow. "Agentic commerce represents one of the most significant shifts in digital commerce since the rise of mobile," said Kathleen Peters, Chief Innovati.

SAN FRANCISCO--(BUSINESS WIRE)--Fastly, Inc. (NASDAQ: FSLY), a leading global edge cloud platform, today announced that it will host investors and analysts at its 2026 Investor Day at the Nasdaq MarketSite in New York City on September 22, 2026. This half-day event will feature presentations by Fastly's executives who will provide updates on the company's strategy, product roadmap, financials, and business outlook. Fastly will host a live virtual webcast of the event beginning at 1:00 PM ET. To.

Key Takeaways Fastly joined DIMPACT as its first edge cloud provider to improve digital emissions measurement. Fastly's platform data and sustainability dashboard help customers track electricity use and emissions. Fastly projects Q2 2026 revenues of $170-$176 million and non-GAAP EPS of 5 cents to 8 cents. Fastly (FSLY - Free Report) shares have surged 96.8% in the year-to-date period, significantly outperforming the Zacks Computer and Technology sector’s 17.0% gain. The rally reflects improving financial performance, accelerating security revenue growth and growing adoption of the company's edge cloud platform.

Fastly is strengthening its long-term growth prospects by expanding its digital sustainability initiatives. As global internet traffic and artificial intelligence (AI) workloads continue to rise, enterprises are increasingly seeking infrastructure providers that not only deliver high performance but also help measure and reduce the environmental impact of digital operations.

Fastly Expands Digital Sustainability Through DIMPACTFastly joined DIMPACT, a leading collaboration focused on measuring and reducing the carbon footprint of digital media. As the first edge cloud platform provider to participate in the initiative, Fastly will contribute edge network expertise, emissions data and technical insights to help develop more accurate methodologies for measuring emissions across digital content delivery.

The partnership is expected to benefit media companies, streaming providers, publishers and other digital businesses by improving visibility into emissions generated throughout the internet delivery chain. As organizations place greater emphasis on Scope 3 emissions reporting and sustainability goals, Fastly's participation could strengthen its relationships with enterprise customers seeking environmentally responsible infrastructure partners.

This integration of Fastly's global edge platform data with DIMPACT's sustainability framework is expected to help customers optimize digital delivery, reduce environmental impact and strengthen Fastly's position as a trusted infrastructure provider.

Sustainability Initiatives Strengthen Fastly's Growth StoryFastly's participation in DIMPACT leverages the scale of its global edge cloud platform, which processes more than 5 trillion requests daily across 578 terabits per second of edge capacity. The company can provide real-world operational data that helps enterprises better measure and manage the environmental impact of digital content delivery as customer traffic flows through its infrastructure before reaching end users.

FSLY offers a sustainability dashboard that tracks electricity consumption and greenhouse gas emissions associated with platform usage, complementing DIMPACT's goal of establishing industry standards for digital emissions. These capabilities could strengthen Fastly's relationships with multinational streaming, publishing and enterprise customers seeking both high-performance edge services and greater carbon transparency.

The initiative also supports Fastly's international expansion strategy, particularly as sustainability reporting requirements continue to evolve globally. The company continues to expand its presence in Asia-Pacific, including a new Singapore office, while positioning sustainability and carbon transparency as differentiators for enterprise customers. Its improving execution is reflected in first-quarter 2026 revenue growth of 20% to $173 million, 47% growth in security revenues and a 63% increase in remaining performance obligations to $369 million.

Fastly Offers Strong Q2 2026 OutlookFastly's expanding AI, security and edge cloud platform, together with improving enterprise demand, are expected to support revenue growth.

For the second quarter of 2026, FSLY guided revenues to $170-$176 million and non-GAAP earnings to 5-8 cents per share.

The Zacks Consensus Estimate for second-quarter 2026 revenues is pegged at $174.03 million, indicating year-over-year growth of approximately 17.02%.

The consensus mark for second-quarter 2026 earnings is pegged at 7 cents per share, which has remained unchanged over the past 30 days, indicating year-over-year growth of 333.33%.

FSLY's Zacks Rank & Stocks to ConsiderCurrently, Fastly carries a Zacks Rank #3 (Hold).

Digital Turbine (APPS - Free Report) , Dell Technologies (DELL - Free Report) and Analog Devices (ADI - Free Report) are some top-ranked stocks that investors can consider in the broader Zacks Computer and Technology sector. Digital Turbine, Dell Technologies and Analog Devices sport a Zacks Rank #1 (Strong Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

APPS shares have rallied 99% in the year-to-date period. The long-term earnings growth rate for Digital Turbine is pegged at 18.98%.

DELL shares have surged 239.3% in the year-to-date period. The long-term earnings growth rate for Dell Technologies is pegged at 26.35%.

Shares of ADI have gained 42.3% in the year-to-date period. The long-term earnings growth rate for Analog Devices is pegged at 28.76%.

SAN FRANCISCO--(BUSINESS WIRE)--Fastly, Inc. (NASDAQ: FSLY), a leading global edge cloud platform, today announced it has become a participant of DIMPACT, the coalition of leading organizations working to align industry changemakers and policymakers around meaningful, science-based solutions that reduce the environmental impacts of serving digital media products. As the first edge cloud platform provider to join the coalition, Fastly brings critical, real-world edge network data and infrastruct.

On June 17, 2026, Fastly (FSLY +5.71%) President of Go to Market, Scott R. Lovett, executed an open-market sale of 41,716 shares of Common Stock for a total value of approximately $741,000, according to an SEC Form 4 filing.

Transaction summaryMetricValueShares sold (direct)41,716Transaction value$741,293Post-transaction shares (direct)1,392,778Post-transaction value (direct ownership)$24.25 millionTransaction value based on SEC Form 4 reported price ($17.77); post-transaction value based on June 17, 2026 market close ($17.41).

Key questionsHow does this sale compare to Scott Lovett’s historical selling activity?
The 41,716-share sale is below the historical mean sale size of ~48,452 shares for Lovett’s prior open-market dispositions, reflecting both reduced capacity after a series of larger sales and a disciplined ongoing cadence.What proportion of total and direct holdings did this transaction represent?
The sale accounted for 2.91% of Lovett’s direct holdings at the time, leaving a substantial remaining position of 1,392,778 shares under direct ownership.Did this transaction involve indirect holdings or derivatives?
No indirect entities or derivative securities participated; all shares sold were directly held Common Stock, and Lovett’s remaining position is solely direct Class A Common Stock.What market context surrounded the sale and what does it imply for future capacity?
The transaction occurred as Fastly shares were priced at $17.41 at the June 17, 2026 close (with a one-year total return of 162.6% as of that date), and the declining trade sizes over time are a function of Lovett’s shrinking available holdings, rather than a discretionary reduction in sales pace.Company overviewMetricValuePrice (as of market close June 17, 2026)$17.41Market capitalization$2.68 billionRevenue (TTM)$652.57 million1-year price change162.6%* 1-year price change calculated using June 17, 2026 as the reference date.

Company snapshotFastly offers an advanced edge cloud platform, including Compute@Edge, edge security services, content delivery, streaming, and developer tools for application deployment and protection.It delivers edge computing and security solutions as Infrastructure as a Service (IaaS).The company serves digital publishers, media and entertainment firms, technology companies, e-commerce, travel, hospitality, and financial services clients globally.Fastly operates a global edge cloud platform that enables rapid, secure, and programmable delivery of digital experiences for enterprise customers. The company differentiates itself through a highly customizable infrastructure, robust developer resources, and integrated security solutions designed for performance and scalability.

With a focus on serving demanding digital businesses, Fastly leverages its technology to address complex content delivery, security, and application deployment needs at the network edge.

What this transaction means for investorsInsider Scott Lovett’s June 17 sale of Fastly stock came at a time when shares had fallen substantially from their 52-week high of $34.82 reached in April. However, his disposition is not a red flag for investors.

The sale was a non-discretionary transaction executed as part of a pre-arranged Rule 10b5-1 trading plan adopted back in February of 2025. Such plans are often implemented by insiders to avoid accusations of trading based on insider information.

In addition, Lovett still held over one million shares after his sale. This indicates he maintains a substantial equity position in the company.

Fastly shares fell after a spectacular run fueled by investor enthusiasm over rising internet traffic from artificial intelligence bots scouring for information online. It’s likely investors decided to cash in after Fastly’s stock valuation became sky-high.

Despite the share price drop, the company is doing well. It posted 20% year-over-year revenue growth to $173 million in the first quarter. Fastly management forecasted full-year sales of at least $710 million, up from the $624 million produced in 2025.

Key Takeaways Fastly's security revenues rose 47% YoY to $38.8M, hitting 22% of total revenues in Q1. Next-Gen WAF led, but DDoS Protection, Bot Management and API Discovery gained traction with new customers. Seven-figure security deals and smaller wins supported growth as AI bot traffic and shadow API risks rose. Fastly, Inc. (FSLY - Free Report) delivered a strong first-quarter 2026 performance in its security business, with security revenues increasing 47% year over year to $38.8 million. Security accounted for 22% of total revenues in the quarter, reaching record levels for the company. The segment also grew 9% sequentially, marking the fourth straight quarter of accelerating security revenue growth.

Fastly’s security momentum is becoming stronger. Its Next-Gen WAF remained a core driver, but newer products also gained traction. These include DDoS Protection, Bot Management, and API Discovery and Inventory. Among instances of security products sold to new customers in the quarter, almost half came from these newer offerings. This indicates that Fastly’s security portfolio is expanding beyond one flagship product and gaining relevance across a wider set of customer needs.

Customer activity also supported the security growth story. Fastly closed multiple seven-figure deals that included security, while smaller wins also contributed. This suggests the quarter’s growth was not associated with just one isolated transaction.

AI-related traffic and security risks are also adding to the relevance of Fastly’s tools. ContentGuard was added by a long-standing media customer facing daily malicious AI bot traffic, while API security tools were positioned to help address shadow API risks as AI speeds up code delivery.

Fastly’s security business is becoming a more meaningful part of the company’s revenue mix. With stronger adoption across both established and newer security products, the segment’s momentum reflects improving product depth, broader customer engagement and a clearer role for security within Fastly’s platform strategy.

NET and AKAM Benefit From Rising Security and AI DemandCloudflare, Inc. (NET - Free Report) reported fourth-quarter 2025 revenues of $614.5 million, up nearly 34% year over year, while full-year revenues increased about 30% to $2.17 billion. Management highlighted strong demand related to AI, enterprise security and connectivity workloads. Cloudflare also noted that large customer revenues grew 42% year over year and accounted for 73% of total revenues. NET continues to see traction across its Zero Trust, application security and Cloudflare Workers offerings.

Akamai Technologies, Inc. (AKAM - Free Report) also reported steady security momentum in its latest quarter. Akamai Technologies’ fourth-quarter 2025 revenues increased 7% year over year to $1,095 million. Akamai Technologies’ security revenues rose 11% year over year to $592 million, while Guardicore Segmentation and API Security revenues jumped 36% to $90 million. These figures show that AKAM continues to see demand for cybersecurity, API protection and segmentation offerings.

FSLY Stock Price Performance, Valuation & EstimatesShares of Fastly have surged a whopping 314.3% over the past year against the industry’s decline of 8%.

FSLY Price Performance Versus Industry
Image Source: Zacks Investment Research

From a valuation standpoint, FSLY trades at a forward price-to-sales ratio of 6.69, higher than the industry’s average of 3.8.

FSLY Valuation Compared to Industry
Image Source: Zacks Investment Research

© metamorworks / Shutterstock.com

Shares of Fastly (NYSE:FSLY) just earned a strong endorsement from Raymond James, which upgraded the edge cloud platform to Outperform from Market Perform with a $23 price target. The call lands in the wake of a 38% one-day decline that followed an in-line quarter, making this a clearly contrarian view. Raymond James argues the market overreacted and that an AI-driven traffic inflection is the dominant longer-term theme.

The split with peers is the story. Piper Sandler reiterated a Hold on Fastly stock the same week, framing the quarter as a thesis crack rather than a setup. For broader context on how analysts are positioning around AI infrastructure names, see our recent coverage of AI infrastructure analyst upgrades.

Ticker Company Firm Action Old Rating New Rating Old Target New Target FSLY Fastly Raymond James Upgrade Market Perform Outperform n/a $23 The Analyst’s Case Raymond James believes Fastly has reached an “inflection” in operational performance, with rising demand for its network capacity and security products. The firm sees AI-driven traffic increases continuing to benefit delivery networks with more advanced capabilities.

Crucially, the analyst points to structure. Fastly’s network runs through major interconnected data centers positioned to capture incremental AI and inference-related traffic as those workloads scale, an architectural moat the firm is willing to underwrite at $23.

Company Snapshot Fastly operates an edge cloud platform spanning Network Services, Security, and Compute & Observability. In Q1 2026, revenue grew 20% year over year to $173.02 million, with Security up 47% and Compute & Observability up 67%.

CEO Kip Compton stated that Fastly delivered “record revenue, gross margin, and RPO” in the quarter. Management raised full-year guidance to $710 million to $725 million in revenue, with non-GAAP EPS of $0.27 to $0.33.

Why the Move Matters Now Fastly stock closed at $19.50 on May 7 after the post-earnings selloff, well below its 52-week high of $34.82. The Raymond James $23 target sits just above the $22.75 consensus analyst target, reframing the post-earnings drawdown as opportunity rather than damage.

The bull case rests on CDN economics shifting in an AI-heavy traffic environment. Inference traffic is more compute-intensive than static content delivery, which favors Fastly’s edge compute and security stack. RPO of $369 million grew 63% year over year, and net retention ticked up to 113%.

What It Means for Your Portfolio For prudent investors, Fastly stock now sits at the center of a genuine analyst debate. The bear case from Piper Sandler centers on volume softness and pricing pressure in core delivery, alongside competition from hyperscaler-affiliated CDN alternatives. Customer concentration also remains elevated, with the top 10 customers representing 34% of revenue.

The bull case is the one Raymond James is buying: durable growth from AI traffic, edge compute monetization, and security cross-sell. With shares up 98% year to date despite the recent drop, position sizing matters.

When two reputable firms split this sharply on the same name in the same week, the narrative is in flux. Investors comfortable with usage-based volatility may find the risk/reward attractive at current levels, while more conservative readers might wait for the next quarter to settle the inflection question.

Fastly (FSLY) is rated a buy, with a fair value estimate of $30 versus a current price of $20.50, driven by accelerating growth and robust fundamentals. FSLY posted Q1 2026 revenue of $173M (+20% YoY), security revenue up 47% YoY, net retention rate at 113%, and RPO up 63% YoY to $369M. Management raised 2026 revenue guidance to $710–$725M and EPS guidance by 15%, signaling fundamental earnings model reset and durable growth trajectory.