Update shared on04 Sep 2025
Analysts remain divided on Akamai Technologies due to concerns over consistent growth, particularly in Security and Delivery segments, and while recent strong results and guidance upgrades have fueled some optimism, the consensus Analyst Price Target is unchanged at $95.20.
Analyst Commentary
- Concerns about Akamai's ability to deliver consistent growth across all business segments, with particular emphasis on the need for stabilization in Security and Delivery segment revenues.
- Bearish analysts assert that a valuation re-rating will require demonstrated improvement in Security revenue growth, capital expenditure returns in Compute, and long-term growth stability in Delivery.
- Bullish analysts point to strong 2Q25 results and raised guidance for 3Q25, as well as increased 2025 revenue and Non-GAAP EPS targets, supporting positive sentiment.
- Continued Delivery segment rebound with normalizing traffic growth and a shift in revenue mix toward Compute and Security now accounting for more than two-thirds of total revenue.
- Mixed outlook due to differing views on the sustainability of recent performance improvements and the company's ability to drive meaningful long-term growth across newer business lines.
What's in the News
- TD Cowen raised Akamai’s price target to $98 (from $92) following upside Q2 2025 results, stronger Q3 2025 outlook, and increased 2025 revenue/Non-GAAP EPS guidance, while maintaining growth forecasts for Security and Compute segments (Periodicals).
- Akamai entered a strategic partnership with Aqua Security to deliver integrated, full-spectrum protection for AI applications, combining Aqua’s Secure AI runtime defense with Akamai’s Firewall for AI, targeting enterprise-level AI security and compliance challenges (Key Developments).
- The company partnered with Aptum to enhance day 0-2 cloud services, aiming to streamline cloud migration, drive cost savings, and expand cloud offerings for technology service distributors, with both organizations investing in the TSD channel (Key Developments).
- Akamai completed a significant share repurchase, buying back 3.87 million shares (2.65% of shares outstanding) for $300 million in Q2 2025, reaching a cumulative 6.89% repurchased for $819.5 million since May 2024 (Key Developments).
- Recent product updates include enhancements to Akamai API Security—such as a managed service for API security, code repository integration, and a compliance dashboard—to address evolving threats and regulatory requirements, plus a new video management partnership with Cloudinary to boost video experience delivery (Key Developments).
Valuation Changes
Summary of Valuation Changes for Akamai Technologies
- The Consensus Analyst Price Target remained effectively unchanged, at $95.20.
- The Consensus Revenue Growth forecasts for Akamai Technologies remained effectively unchanged, at 6.1% per annum.
- The Discount Rate for Akamai Technologies remained effectively unchanged, at 10.24%.
Disclaimer
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