Akamai sees upbeat third quarter; shares rise
(Reuters) - Internet content delivery company Akamai Technologies Inc posted better-than-expected quarterly results on higher adoption of its cloud infrastructure services, and forecast an upbeat third quarter.
Shares of Akamai, which counts Autodesk Inc, EMC Corp and SAP AG as customers for its cloud infrastructure services, were up 16 percent at $32.90 in after-market trade.
In a conference call with analysts, Akamai forecast third-quarter adjusted earnings of 40 cents to 42 cents per share, on revenue of $332 million to $342 million.
Analysts were expecting adjusted earnings of 38 cents per share, on revenue of $330.8 million, according to Thomson Reuters I/B/E/S.
"Even amid the macroeconomic challenges, we are benefiting from a sub-theme of movement of business to online," Chief Executive Paul Sagan told Reuters.
The company's second-quarter net income fell to $44 million, or 24 cents per share, from $47.9 million, or 25 cents per share, a year earlier.
Excluding items, it earned 43 cents per share.
Revenue for the company, which competes with Level 3 Communications and Limelight Networks, rose 20 percent to $331 million.
Analysts on average had expected earnings of 37 cents per share on revenue of $325.7 million.
Peer Level 3 posted a bigger-than-expected quarterly loss earlier in the day on a fall in orders from the U.K. government.
Akamai is benefiting from a rising spend on Internet initiatives by companies across the world as they try to cut costs. It has also taken the acquisition route to fuel growth.
The company in December acquired rival Cotendo for $268 million to strengthen its web acceleration business. The acquisition added clients such as Facebook Inc, Zynga Inc, Google Inc and AT&T Inc.
Cambridge, Massachusetts-based Akamai's stock has lost about a quarter of its value since the company forecast a weak second quarter on April 25. They closed at $28.25 on Wednesday on the Nasdaq.
(Reporting by Sruthi Ramakrishnan and Supantha Mukherjee in Bangalore; Editing by Maju Samuel, Sriraj Kalluvila)