Fastly, Inc. Earnings Recaps
Q2 2026
Aug 7, 2026
Fastly's shares dropped 9.1% after earnings as investors reacted negatively to cautious outlook comments that tempered the otherwise solid execution. Despite strong revenue growth and margin expansion, the market focused on concerns about sustainability and future headwinds.
Key takeaways
- Revenue rose 23% year-over-year to $183 million, hitting the high end of guidance.
- Gross margin improved to a record 65.8%, with operating income of $27 million and an operating margin of 14.7%, both above guidance.
- Net retention rate reached 117%, the highest in over three years, supporting ongoing platform expansion.
- Security segment showed robust 43% growth driven by cross-sell and upsell of threat defense and governance products.
- Despite operational discipline and cash flow positivity, cautious management commentary on future growth dynamics appeared to weigh on investor sentiment.
Q1 2026
May 8, 2026
Fastly's stock plunged 39.7% following earnings, reflecting investor disappointment with the cautious outlook and indications of deceleration despite headline revenue growth and margin gains.
Key takeaways
- Reported revenue of $173 million, up 20% year-over-year and near the high end of guidance.
- Security revenue grew 47% year-over-year, comprising 22% of total revenue, signaling strong product momentum in this segment.
- Compute category revenue increased 67% year-over-year, marking the largest quarter-on-quarter step-up in this segment's history.
- Network Services grew 11% year-over-year, roughly double the market growth rate, supported by ongoing customer wins and platform reliability.
- Management emphasized AI as a future growth driver with new product developments and pipeline momentum, but no explicit guidance upgrades were given.
Q3 2025
Nov 6, 2025
Fastly delivered a stellar Q3 2025, outperforming revenue and operating profit expectations while achieving record free cash flow, showcasing significant progress in its growth and profitability strategy.
Key takeaways
- Q3 revenue reached $158.2 million, exceeding guidance and representing a 15% year-over-year growth.
- Gross margin improved to 62.8%, a 380 basis point sequential increase, driven by operational leverage.
- Record operating income of $11.6 million, significantly above the guidance midpoint of $1 million.
- Security revenue surged by 30% year-over-year, buoyed by cross-sell initiatives and strategic multi-product wins.
- Free cash flow achieved a record of $18 million, reflecting disciplined financial management and operational efficiency.