Analyst Note| Matthew Dolgin, CFA |
Akamai had a good second quarter, as it was no surprise that the its core content delivery network, or CDN, business would look sluggish relative to the great quarter a year ago that was boosted by lockdowns and the resulting spike in streaming traffic. The firm’s security business continues to outperform even our lofty expectations and is showing no signs of materially slowing. It continues to drive the company’s performance and now makes up almost 40% of total revenue. We are not making any changes to our long-term forecast, and we are increasing our fair value estimate to $78 from $76 after incorporating the quarter’s results.