Akamai earnings beat estimates as more people watch video online
(Reuters) - Akamai Technologies Inc (AKAM.O), whose products help to move content quickly over the Internet, posted quarterly results ahead of Wall Street estimates as more people turn to the Web to watch movies and TV programs.
Akamai shares, which have risen about 25 percent in the last three months, rose marginally in post-market trading.
The company benefits as more content is passed through social networking and gaming websites, particularly video.
"More people are watching more video online at higher quality levels, which means more traffic (for Akamai)," Chief Executive Tom Leighton told Reuters.
Strong traffic growth in the latest quarter helped the company to offset a shrinking customer base.
Akamai, which has 132,442 servers across the world, has been winding down some of its media contracts, saying they had no long-term financial value.
The company said in April it would scrap a large media customer contract at the end of the second quarter. Analysts said Netflix Inc (NFLX.O) could be that customer.
Akamai's other media clients include Apple Inc (AAPL.O), Sony BMG, News Corp (NWSA.O), Nintendo Co 7974.OS and NBC.
The company said on Wednesday that net income rose to $61.9 million, or 34 cents per share, in the second quarter, from $44.2 million, or 24 cents per share, a year earlier.
Revenue rose 14 percent to $378.1 million, beating analyst expectations for the second consecutive quarter.
Excluding items, the company earned 46 cents per share.
Analysts on average were looking for adjusted earnings of 45 cents per share on revenue of $374.2 million, according to Thomson Reuters I/B/E/S.
(Reporting by Chandni Doulatramani in Bangalore; Editing by Sriraj Kalluvila and Ted Kerr)