Big fourth quarter for content delivery network Akamai: The company reported Q4 sales of $212.6 million, beating the Street’s $205.46 consensus. EPS came in at $0.44, beating the Street’s $0.40 consensus.
Akamai got a boost from its acquisition of ad targeting firm Acerno. The company added $6.9 million to Akamai’s Q4. Without that revenue, Akamai would have reported $205.7 million of revenue, just above consensus.
How about this year? Akamai didn’t offer full year guidance, but said Q1 should be in line with expectations. Akamai offered revenue guidance of $205-212 million; the $208.5 million midpoint is slightly above the Street’s $208 million consensus. Akamai expects adjusted EPS between $0.39-41, slightly below the Street’s $0.41 consensus.
During Q4, the company said it signed up 50 new customers under long-term contracts during the quarter. Investors will likely perceive that as a good number.
On the company’s earnings call, CEO Paul Sagan said the company recently re-signed a multi-year deal with Apple. This in response to a report that Apple had recently been using Akamai competitor Limelight Networks (LLNW) for some content delivery.
LIVE Conference Call Notes; refresh for the latest
4:33 Call beginning.
4:34 Standard disclaimers.
4:35 Sagan: Akamai performed very well in Q4. Record revenue of $212.6 million, 16% y/y increase.
4:35 Full year revs up 24%.
4:36 Even as external environment became more challenging, grew business. Back in a few, but first here’s JD Sherman.
4:36 CFO going over results from release.
4:37 Stronger than expected holiday season online w/ ecommerce. Media and entertainment up 9%, continuing slowing trend as expected.
4:37 Sales outside North America 25%.
4:38 Total customer count 2,858. Gross adds over 160, consistent with run rate. No 10% customer. Churn just under 4%, consistent.
4:40 Still going over numbers from release. More good metrics here. (PDF)
4:45 Macro has affected all of customers’ businesses, including our own. Still investing in innovative new solutions.
4:46 Pleased with strength of our own business. Still anybody’s guess as to when economy will recover. Prudent not to give full year guidance. In Q1, coming off strongest quarter where holiday bursting in ecommerce, and seasonally higher revs from ad. Expect revenue of $205-212 million. (Right around consensus.)
4:47 EPS Guidance 0.39 to 0.41, 1 cent below consensus.
4:52 Sagan talking up HD online video, ad market potential, app acceleration.
4:53 Apple deal has been raising questions. We continue to have a very close relationship with Apple, including all of iTunes. Recently extended long-term relationship for another multi-year term.
4:57 Higher than average bursting.
4:57 AKAM shares up 8% after hours.
4:58 Online video CE a catalyst? More examples of what we’ve been talking about… television over IP.
4:59 Substantial audiences to find and monetise on the Internet. Quality matters, scale difficult if not impossible to achieve. They come to Akamai.
5:01 Macro issue a bigger problem in the malls than it is online.
5:03 Unit volumes vs pricing. We don’t give out network traffic stats. Seeing similar trend — customers very interested in driving down unit pricing. Very focused on driving down unit costs. Volume discounts nothing new in our business, continue to drive toward being able to offer them.
5:04 Acerno even more seasonal. Not uncommon for ad spend to be approaching half in Q4.
5:15 Any observation on deals getting done? Certainly see more often a few anecdotes where a deal takes longer. But very strong signings of quality deal in Q4, didn’t have people running for the door.
5:24 M&A? We’ll look at anything that we think will drive long term growth and obviously shareholder value.
5:32 Call over. Nothing thrilling at the end. Thanks for joining.
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