Akamai Technologies is bracing for a weaker first-quarter profit, with shares declining nearly 9% after market close. The company cited the ongoing memory supply squeeze, exacerbated by the rapid build-out of artificial intelligence infrastructure by major tech firms, as a key driver of increased costs. CEO Tom Leighton indicated that Akamai may need to pass some of these higher memory expenses, which have reportedly doubled, onto customers.
For the first quarter, Akamai projects adjusted profit per share to range between $1.50 and $1.67, falling short of the $1.75 average estimate from Wall Street analysts. Despite this near-term outlook, the company offered a more optimistic forecast for 2026 revenue, projecting $4.40 billion to $4.55 billion, exceeding the estimated $4.42 billion. Akamai is leveraging demand in security and compute segments as businesses increasingly focus on securing cloud environments and web infrastructure.
In the fourth quarter ended December 31, Akamai reported revenue of $1.10 billion, surpassing an estimate of $1.08 billion. Adjusted quarterly earnings came in at $1.84 per share, also exceeding the $1.76 per share estimate.