Akamai Shares Surge 27% on Q1 Earnings, $1.8B AI Deal

Akamai Technologies shares surged more than 27 percent in premarket trading Friday after the company reported first-quarter earnings that met Wall Street expectations and disclosed a $1.8 billion, seven-year cloud infrastructure deal with an unnamed leading U.S. frontier AI model provider.

The cybersecurity and cloud computing firm posted revenue of $1.07 billion for the quarter ended March 31, up 6 percent from a year earlier and in line with analyst estimates. Adjusted earnings per share came in at $1.61, matching forecasts, though down from $1.70 in the year-ago period. Net income fell 14 percent to $106 million, or 71 cents per diluted share.

The standout development was the AI deal, described by Chief Executive Tom Leighton as the largest customer agreement in company history. It commits the client to Akamai's cloud infrastructure services over seven years, with revenue expected to ramp up starting in the fourth quarter, contributing $20 million to $25 million initially. Cloud Infrastructure Services revenue, now reported separately, jumped 40 percent year over year to $95 million. Security revenue rose 11 percent to $590 million, while delivery and other applications...