Today’s Change
Current Price
Fastly (FSLY 38.23%), a real-time content delivery network provider, closed Thursday at $19.50, down 38.23%. The stock sank after record Q1 results and raised 2026 guidance failed to ease concerns about slowing core networking services growth. Trading volume reached 47.1 million shares, about 208% above its three-month average of 15.3 million shares. Fastly IPO’d in 2019 and has fallen 19% since going public.
How the markets moved today
The S&P 500 slipped 0.38% to 7,337, while the Nasdaq Composite eased 0.13% to finish at 25,806. Industry peers Akamai Technologies closed at $116.69 (-4.34%) and Cloudflare ended at $257.05 (+3.40%), underscoring mixed reactions to recent earnings.
What this means for investors
Fastly grew sales by 20% in Q1 and delivered profitability on an adjusted EPS basis, beating Wall Street’s estimates. However, while it raised 2026 guidance to include 15% sales growth, the market sold the stock off on the prospect that sales growth would decelerate, and Fastly’s core Network Services segment grew revenue by only 11%.
While this deceleration was disappointing, management noted this 11% growth was still double the market’s rate. Meanwhile, its nascent Security and Compute units — which account for roughly one-fourth of Fastly’s sales now — delivered revenue growth of 67% and 47%, respectively.
However, trading at 71 times forward earnings after its stock tripled over the last year, I’m just going to watch Fastly for now, especially as management believes its infrastructure capex (as a percentage of revenue) will more than double in 2026.
Josh Kohn-Lindquist has positions in Cloudflare. The Motley Fool has positions in and recommends Cloudflare and Fastly. The Motley Fool recommends Akamai Technologies. The Motley Fool has a disclosure policy.
