What is Akamai Net Worth and Key Revenue Streams 2024: Security, Compute, and More

Akamai net worth is a topic of interest for many in the financial world. At $15.39 billion, Akamai has established itself as a powerful player.

In this article, Ando Money analyzes Akamai’s financial performance, focusing on key revenue streams such as security, compute, and regional revenue contributions.

Quick Facts

What is the Net Worth/Market Cap of Akamai in 2024?

Akamai’s net worth or market cap stands at $15.39 billion as of 2024. This places Akamai in a competitive position among other major tech players.

Compared to others, Akamai maintains a significant role in the industry, supported by its growth in security and compute services.

The company ranks well among other tech firms, and while its valuation may not be as high as giants like Apple, it still contributes notably to the global tech ecosystem.

For more about other prosperous companies, check out this comprehensive list of wealthy firms richest companies.

Companies similar to Akamai in terms of market focus and financial performance include:

• Cloudflare
• Limelight Networks
• Fastly
• IBM
• Amazon Web Services (AWS)
• Microsoft Azure
• Google Cloud
• Oracle Cloud
• Cisco
• F5 Networks

Financial Performance Overview

Key Revenue Streams for the Firm

Akamai’s key revenue streams are mainly derived from security, compute, and content delivery services. The firm’s total revenue in Q2 2024 was $980 million, reflecting a 5% increase year-over-year.

The company’s strength is rooted in diversified services, with security and compute now representing a substantial share of total income.

Breakdown of Security Services Revenue

Security services are a crucial component of Akamai’s revenue structure, accounting for $499 million in Q2 2024, which is approximately 51% of the overall revenue.

This marks a 15% year-over-year growth, showing Akamai’s commitment to enhancing its security solutions, which is vital for the stability and attractiveness of its financial performance.

The consistent growth rate in the security segment reflects market demand and Akamai’s ability to innovate in protecting online infrastructure.

Financial Impact of Compute Services

Compute services brought in $151 million during Q2 2024, showing an impressive 23% year-over-year increase. This segment is a growth driver, with demand for cloud computing continuously on the rise.

Akamai’s investment in expanding its compute capacity aligns well with market trends, offering attractive solutions for enterprises looking to leverage distributed computing.

The performance in compute services signifies Akamai’s increasing role in the cloud and infrastructure space.

Contribution from Content Delivery Services

The content delivery segment generated $329 million in Q2 2024 but experienced a decline of 13% year-over-year. Despite this drop, the firm remains a leader in content delivery services.

The fluctuation can be attributed to shifts in client demand and increased competition, impacting the profitability of traditional content delivery. Nevertheless, Akamai continues to innovate in this space, aiming for long-term sustainability.

Regional Revenue Contributions

Breaking down the revenue geographically, U.S. revenue accounted for $509 million, marking a 6% year-over-year increase, whereas international revenue contributed $471 million, reflecting a 3% growth.

The balance between domestic and international operations highlights Akamai’s strategic approach to global market demands, adapting its services to a diverse set of requirements across different regions.

Investments Driving Financial Growth

Akamai’s investments in expanding its infrastructure, particularly in the compute and security segments, are essential drivers of financial growth.

The company has utilized $128 million in share repurchases during Q2 2024, demonstrating confidence in its financial health and future prospects.

Investments are also channeled into research and development, supporting innovation that enhances both customer solutions and the firm’s overall valuation.

Role of Convertible Senior Notes in Funding Growth

Convertible senior notes are an essential part of Akamai’s financial strategy, currently totaling approximately $3.54 billion.

These notes provide a source of liquidity that helps fund operational and growth initiatives, such as expanding compute and security services.

The convertible nature of these notes offers flexibility, which is advantageous in times of market volatility.

This financing approach strengthens Akamai’s ability to scale effectively while supporting a stable financial outlook.

Expenses and Operating Costs Impacting Profitability

Akamai’s operating costs for Q2 2024 totaled $831.59 million, covering aspects like research, development, marketing, and administrative expenses. These costs have a significant impact on profitability, with the operating margin reported at 15%.

The balance between investing in growth and managing expenses is critical for Akamai’s sustained profitability.

The research and development expenditure underscores the company’s focus on innovation, which is essential in maintaining competitiveness in the market.

Contribution of Stock Buybacks to Financial Strategy

The stock buybacks in Q2 2024 were valued at $128 million, with Akamai repurchasing 1.4 million shares at an average price of $94.29 per share.

These buybacks are part of a broader financial strategy to return value to shareholders, boost earnings per share, and instill confidence in the market regarding the firm’s long-term prospects.

Assets and Their Role in Supporting Revenue

Akamai’s total assets stand at $10.08 billion as of June 2024. These assets play a crucial role in supporting the firm’s revenue-generating activities, from financing new infrastructure to ensuring operational efficiency.

With a mix of current and non-current assets, including cash and cash equivalents at $1.9 billion, Akamai is well-positioned to seize growth opportunities while managing its financial obligations.

Employee Role in Financial Growth

Akamai employs 10,920 individuals as of mid-2024. Employees are a vital asset, directly impacting productivity, innovation, and customer satisfaction.

Akamai’s financial performance is significantly influenced by its workforce, with substantial investments made in employee retention and development.

This investment ensures high service standards and the company’s continued ability to capture and retain market share.

FAQs About Akamai

How Does Akamai Generate Revenue?

Akamai generates revenue from security, compute, and content delivery services. Each segment contributes significantly, with security services representing the largest share.

What is the Role of Convertible Senior Notes in Akamai’s Finances?

Convertible senior notes are used to fund strategic growth, offering liquidity for projects that drive revenue growth, particularly in compute and security segments.

How Many Employees Does Akamai Have?

Akamai has 10,920 employees as of June 2024. The workforce is crucial for driving financial performance, innovation, and maintaining service quality.

What are Akamai’s Total Assets?

As of June 2024, Akamai’s total assets amount to $10.08 billion, supporting both current operations and long-term investments.

How Has Security Revenue Impacted Akamai’s Growth?

Security services significantly impact Akamai’s financial growth, contributing $499 million in Q2 2024, with a 15% year-over-year increase.

Conclusion

Akamai’s financial performance reflects a well-balanced portfolio of security, compute, and delivery services.

I’d love to hear your thoughts, so feel free to leave comments or share this analysis. For more in-depth content, check out Ando Money.