UPDATE 1-Akamai beats estimates on cloud computing demand, shares rise
Oct 24 (Reuters) - Akamai Technologies Inc beat Wall Street expectations as the internet content delivery company reported higher revenue in its cloud computing and media delivery segments.
Shares of the company, which helps firms deliver content faster by avoiding congestion on the Web, were up 5.5 percent in after-market trade.
Akamai has been benefiting from a strong demand for online videos and companies spending more on internet initiatives to cut costs.
"Even though IT spending globally is under a lot of pressure, it is not showing up in our results because one of the things the CIOs are doing is to move businesses to the cloud," Chief Executive Paul Sagan told Reuters.
Cloud services revenue was up 22 percent and media or content delivery was up 23 percent, Sagan said. Total revenue rose 22 percent to $345 million.
Net income rose to $42.3 million, or 27 cents per share, in the third quarter, from $48.2 million, or 23 cents per share, a year earlier.
Excluding items, the company earned 43 cents per share.
Analysts on average had expected earnings of 41 cents on revenue of $338.2 million, according to Thomson Reuters I/B/E/S.
"If you hold constant for currency, the business outside of North America was up 30 percent year-over-year which I think was a big surprise given the economic uncertainty particularly in EMEA," Sagan said.
Shares of the Cambridge, Massachusetts- based company were trading at $38.69 in after-market trade. They closed at $36.11 on Wednesday on the Nasdaq.
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