By Zaheer Kachwala
May 7 (Reuters) – Shares of Akamai Technologies soared 24% in extended trading on Thursday after the company disclosed a $1.8 billion long-term cloud deal with a frontier model provider.
Still, the company forecast underwhelming quarterly results as a sharp rise in prices of memory infrastructure ripples across the industry, hitting profits and hiking costs and prompting firms to get cautious with spending.
“There’s some component prices that have gone up quite a bit in response to the increased demand. I think Akamai is in a good position to get access to all the components, CPUs, GPUs we need,” CEO Tom Leighton told Reuters.
• The company forecast second-quarter revenue of between $1.08 billion and $1.10 billion, compared with estimates of $1.10 billion, according to data compiled by LSEG.
• It expects second-quarter adjusted profit of $1.45 to $1.65 per share, while analysts expect $1.68 per share.
• Revenue for the first quarter came in at $1.07 billion, in line with Wall Street expectations.
• It reported profit per share of 71 cents, compared with 82 cents per share a year ago.
(Reporting by Zaheer Kachwala in Bengaluru; Editing by Tasim Zahid)
