GICS Sector : Technology
Fastly, Inc.operates an edge cloud platform for processing, serving, and securing its customer's applications in the United States, the Asia Pacific, Europe, and internationally.The edge cloud is a category of Infrastructure as a Service that enables developers to build, secure, and deliver digital experiences at the edge of the internet.
Fastly reported a robust Q3 2025, with revenue reaching $158.2 million, exceeding the high end of their guidance range. The company's gross margin stood at 62.8%, surpassing expectations. The strong financial performance was accompanied by an EPS of $0.07, beating estimates of $0.05518. Operating income was $11.6 million, significantly higher than the $1 million midpoint of their operating guidance range. Adjusted EBITDA was $25.7 million, up from $14.6 million in Q3 2024.
Publication Date: Nov -20
The company's revenue growth was driven by all three product lines, with Network Services revenue growing 11% year-over-year, Security revenue growing 30% year-over-year, and Other Products revenue growing 51% year-over-year. The strong performance was partly due to a large security deal, which contributed to the sequential jump in Q3. However, the company expects security revenue to continue in Q4 without any one-time revenue recognition.
Fastly's international expansion strategy is focused on sales coverage and targeting opportunities in regions such as Asia Pacific, which is growing quickly. The company has seen positive traction in APJ, with wins in several regions. Competitively, Fastly has benefited from the Edgio tailwind, but expects the opportunity with Quill to be smaller. As Kip Compton mentioned, "We believe our success in the third quarter illustrates why customers turn to Fastly: performance, flexibility, programmability, and industry-leading support."
Fastly's valuation metrics indicate a mixed picture, with a P/S Ratio of 2.75 and an EV/EBITDA of -52.43. The company's revenue growth is expected to continue, with analysts estimating 9.0% revenue growth next year. The raised full-year guidance for revenue, profitability, and free cash flow reflects the company's confidence in its ability to execute and drive growth. With a Free Cash Flow Yield of 2.96%, the stock may offer an attractive opportunity for investors.
Fastly, Inc. Prices Upsized $160.0 Million Convertible Senior Notes Offering
Dec -05
Fastly, Inc. Announces Proposed Convertible Senior Notes Offering
Dec -03
Fastly, Inc. (FSLY) Presents at UBS Global Technology and AI Conference 2025 Transcript
Dec -03
HALPER SADEH LLC ENCOURAGES IRHYTHM TECHNOLOGIES, INC. SHAREHOLDERS TO CONTACT THE FIRM TO DISCUSS THEIR RIGHTS
Nov -30
Fastly Announces Listing Transfer to Nasdaq
Nov -26
Fastly, Inc. (FSLY) Presents at Global Technology, Internet, Media & Telecommunications Conference 2025 Transcript
Nov -19
Fastly Empowers Partners to Strengthen Customer Security and Expand Services With New Certification Program
Nov -13
Fastly (FSLY) Upgraded to Buy: Here's What You Should Know
Nov -10
Fastly's Cloud Platform growth is driven by increasing adoption of edge computing, rising demand for real-time analytics, and growing need for security and scalability in digital experiences. Additionally, the shift to cloud-native architectures, expansion into new markets, and strategic partnerships are contributing to the 11% growth.
Fastly's CDN is a highly scalable and secure platform that accelerates the delivery of static and dynamic content, reducing latency and improving user experience.
Fastly's Edge Computing platform enables developers to run custom code at the edge, reducing latency and improving performance for applications that require real-time processing.
Fastly's Image Optimization solution uses AI-powered compression and caching to reduce image file sizes, improving page load times and user experience.
Fastly's Security solutions provide protection against DDoS attacks, SSL/TLS encryption, and web application firewalls to safeguard online applications.
Fastly's Load Balancing solution distributes traffic across multiple servers, ensuring high availability and scalability for online applications.
Fastly's Media Shield is a cloud-based media delivery platform that accelerates the delivery of video and audio content.
Fastly's content delivery network (CDN) and edge computing services are highly specialized, making it difficult for substitutes to emerge.
While Fastly's customers have some bargaining power due to the availability of alternative CDNs, the company's strong brand and high-quality services mitigate this power.
Fastly's suppliers, such as data center providers and network infrastructure vendors, have limited bargaining power due to the company's scale and negotiating power.
While new entrants can potentially disrupt the CDN market, Fastly's established brand, strong customer base, and high barriers to entry make it challenging for new competitors to gain traction.
The CDN market is highly competitive, with established players like Akamai, Cloudflare, and Verizon Digital Media Services competing fiercely for market share.
| Value | |
|---|---|
| Debt Weight | 28.12% |
| Debt Cost | 3.95% |
| Equity Weight | 71.88% |
| Equity Cost | 9.95% |
| WACC | 8.26% |
| Leverage | 39.13% |
Value: 3.7
Growth: 5.7
Quality: 7.4
Yield: 0.0
Momentum: 10.0
Volatility: 4.0
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Value: 6.5
Growth: 5.9
Quality: 3.7
Yield: 0.0
Momentum: 7.0
Volatility: 2.3
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Value: 10.0
Growth: 4.4
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Momentum: 5.0
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Value: 6.0
Growth: 4.3
Quality: 3.9
Yield: 0.0
Momentum: 9.5
Volatility: 0.3
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Value: 9.2
Growth: 5.6
Quality: 4.2
Yield: 0.0
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Volatility: 1.0
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Value: 10.0
Growth: 5.0
Quality: 5.4
Yield: 0.0
Momentum: 0.0
Volatility: 0.0
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