Akamai Technologies, Inc.: Updating Our Model for 1Q26 Results and Guide

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Akamai Technologies, Inc.: Updating Our Model for 1Q26 Results and Guide

7, followed by EPS growth in FY28. While NET 2026e 2026e 2027e 2027e Quarter 2025 Prior Current Prior Current

remains the closest comp, followed by DOCN and CRWV, all three are still relatively Q1 1.70 - 1.61a 1.76 1.67

early in their maturity and not well-suited to value off earnings; as a result, we now Q2 1.73 1.68 1.55 1.90 1.68

Q3 1.86 1.88 1.73 2.00 1.63

use ORCL as a more appropriate EPS benchmark. Q4 1.84 1.83 1.89 2.05 1.77

e = Morgan Stanley Research estimates, a = Actual Company reported data

Our higher PT is supported by stronger forward guidance in the key CIS segment

with growth expectations raised from 45-50% to 50%+, and management

commentary calling for a return to double-digit growth in FY27, which was well

ahead of expectations. As a result, our revenue estimates move materially higher,

largely driven by CIS, which houses the company’s inferencing offering. For FY27, we

model a step down in both FCF and EPS driven by higher capex and lower margins,

as the company invests ahead of revenue recognition, followed by moderation in

FY28 as the buildout matures, requiring less capex and benefiting from better

facility efficiency and a more material revenue contribution.

Our revised base case is $165 based on 24x FY27e EPS of $6.75, (from $120 based

on 16x FY27e EPS of $7.76), as we see topline revenue acceleration paired with

modest durability in margins/FCF through FY28. While we expect earnings growth

to lag the momentum in revenue, with FY26-FY28 EPS CAGR of ~6%, we believe

topline reacceleration to double-digit growth, alongside a relatively sustainable

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