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Akamai Forecasts Solid Earnings as Internet Video, Online Gaming Grow

Akamai Forecasts Solid Earnings as Internet Video, Online Gaming Grow

By Reuters | Updated: 2 May 2014 10:23 IST

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Akamai Technologies Inc, which hosts content for companies on its servers, forecast current-quarter results above analysts' estimates and it posted better-than-expected quarterly results as more people play games and watch videos online.

Shares of Akamai, whose customers include Facebook Inc, Apple Inc, Nintendo Co and Comcast's NBC, rose 4 percent in extended trading.

"We got a bunch of live events, generally of short duration, but had a lot bit more traffic than expected ...," Akamai Chief Executive Tom Leighton told Reuters on Thursday.

Videos of high-profile events such as Sochi Winter Olympics and NBA basketball championships earlier this year were watched online by many sports lovers.

Akamai saw strong growth in software downloads and online gaming in the first quarter ended March 31, the company said in a post-earnings conference call.

Akamai, which has more than 140,000 servers around the world, said revenue from its media customers rose 19 percent.

The company forecast adjusted earnings of 53-57 cents per share and revenue of $464 million to $478 million for the second quarter ending June.

Analysts on average were expecting a profit of 53 cents per share on revenue of $459.4 million, according to Thomson Reuters I/B/E/S.

Akamai's net income rose slightly to $72.8 million, or 40 cents per share in the first quarter from $71.5 million, or 39 cents per share, a year earlier.

Operating expenses rose about 25 percent as the company invested more in product development.

Excluding items, Akamai earned 58 cents per share.

Revenue rose 23 percent to $453.5 million.

Analysts on average had expected a profit of 53 cents per share on revenue of $441.3 million.

Akamai's shares closed at $54.53 on the Nasdaq on Thursday. The stock has risen about 25 percent this year.

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