AKAM · Q2 2026 Earnings

Cautious

Akamai Technologies

Reported August 6, 2026

30-second summary

Akamai printed Q2 revenue of $1.10B (+5% YoY, +2.4% QoQ) at the top of the guide and non-GAAP EPS of $1.59 that beat consensus by 0.6%, with CIS accelerating to +39% YoY ($99M) and management disclosing cumulative multi-year CIS contract signings of over $2.8B year-to-date — including a newly named $600M/4-year contract from a new U.S.-based technology customer for robotics development. But the FY26 guide moved the wrong way on the metrics that matter: EPS high end cut $0.10 to $6.40–$7.05, revenue high end trimmed $20M to $4.445–$4.530B, and operating margin softened from a fixed 26% to a range of 25–26% — meaning the FY26 margin floor just moved down 100bps. The CIS narrative is intact and the contract book is bigger than most modeled; the near-term P&L is worse than the Q1 setup implied.

Headline numbers

EPS

Q2 FY2026

$1.59

+0.6% vs est.

Revenue

Q2 FY2026

$1.10B

+5.0% YoY

+0.9% vs est.

Gross margin

Q2 FY2026

55.8%

Free cash flow

Q2 FY2026

$0.10B

Operating margin

Q2 FY2026

7.3%

Key financials

Q2 FY2026

Metric	Q2 FY2026	Q2 FY2025	YoY	Q1 FY2026	QoQ
Revenue	$1.10B	$1.04B	+5.5%	$1.07B	+2.4%
EPS	$1.59	$1.73	-8.1%	$1.61	-1.2%
Gross margin	55.8%	59.1%	-330bps	56.1%	-30bps
Operating margin	7.3%	14.5%	-720bps	10.7%	-340bps
Free cash flow	$0.10B	$0.23B	-57.4%	$0.12B	-17.4%

Guidance

Guidance is issued for both next quarter and the full year. Both may appear below.

Actuals vs prior guidance

Metric	Period	Prior guide	Actual	Δ	Result
Revenue	Q2 FY2026	$1,075 – $1,100 million	$1,100 million	at high end of guide	Beat
Non-GAAP EPS	Q2 FY2026	$1.45 – $1.65	$1.59	in-line with midpoint	Beat
Non-GAAP Operating Margin	Q2 FY2026	25% to 26%	25%	at low end of guide	Met

New guidance

Metric	Period	Guide	YoY
Revenue	Q3 FY2026	$1,105 – $1,130 million	+5.2% to +7.6% YoY
Non-GAAP EPS	Q3 FY2026	$1.60 – $1.80	—
Non-GAAP Operating Margin	Q3 FY2026	24% to 26%	—
Non-GAAP Tax Rate	Q3 FY2026	19%	—

Changes to prior guidance

Metric	Period	Prior guide	New guide	Δ	Result
Revenue	FY2026	$4,445 – $4,550 million	$4,445 – $4,530 million	-$20M at high end	Lowered
Non-GAAP EPS	FY2026	$6.40 – $7.15	$6.40 – $7.05	-$0.10 at high end	Lowered
Non-GAAP Operating Margin	FY2026	26%	25% to 26%	widened range, -100bps low end	Lowered
Non-GAAP Tax Rate	FY2026	18.5%	19%	+50bps	Raised
Cloud Infrastructure Services YoY Growth	FY2026	at least 50% in constant currency	Withdrawn — no replacement	—	Withdrawn

Segment performance

Q2 FY2026

Segment	Q2 FY2026	Q2 FY2025	YoY
Security	$0.604B	$0.552B	+9.4%
Cloud Infrastructure Services	$0.099B	$0.071B	+39.4%
Delivery and other cloud applications	$0.396B	—	-6.0%
Security Revenue YoY Growth	10%	—	—

Platform metrics

Q2 FY2026

Segment	Q2 FY2026
Cloud Infrastructure Services YoY Growth	39%
Capital Expenditures	$346.5 million (31.5% of revenue)
Cash and Marketable Securities	$4.616 billion

Profitability

Q2 FY2026

Segment	Q2 FY2026	Q2 FY2025	YoY
Non-GAAP Operating Margin	25%	30%	—
Adjusted EBITDA Margin	38%	43%	—
Operating Cash Flow	$326 million (30% of revenue)	$459 million	—

Other KPIs

Q2 FY2026

Segment	Q2 FY2026	Q2 FY2025	YoY
U.S.	$0.55B	$0.528B	+4.2%
International	$0.549B	$0.516B	+6.4%
Share Repurchases	$410 million (3M shares at $134.54)	$300 million	—

Management tone

Narrative arc: Customer optimization hangover → AI experiments → AI-driven CIS inflection with $1.8B anchor → $2.8B in signed contracts (including a named $600M/4-year robotics deal) but FY26 margin and EPS guide cut.

Three quarters ago the AI opportunity was framed as inference cloud demand outstripping GPU supply. Two quarters ago the $1.8B / 7-year contract landed and FY26 was rebuilt around it — CapEx nearly doubled, FY26 operating margin fixed at 26%, 2027 upgraded to "double digits." This quarter the CIS narrative extended (contracts now $2.8B+ cumulatively, with a named $600M/4-year robotics anchor added) but the FY26 P&L moved the other way: EPS high end cut $0.10, margin floor moved down 100bps, tax rate raised 50bps. Management framing from the release: "These major contract wins validate Akamai's growing position as a key AI infrastructure provider." The contract book is growing faster than the P&L can absorb; management is choosing to accept a worse 2026 in exchange for the pipeline it is landing.

The FY26 CIS growth guide was withdrawn. Two quarters ago management raised it to "at least 50% constant currency" and made H2 acceleration the operative bull thesis. This quarter — with CIS running at +39–40% for two consecutive prints — the guide simply disappeared from disclosure. There is no restated growth target. That silence is the tone shift: management would rather withdraw a specific commitment than reset it publicly, and the $2.8B cumulative contract disclosure (with a named $600M robotics deal) is doing the narrative work the withdrawn growth rate used to do.

Margin candor has become a pattern. Three quarters ago FY26 operating margin was guided 26–28%. Two quarters ago the high end was cut to a fixed 26%. This quarter the low end moved to 25%. Each quarter management has moved the FY26 margin floor down while keeping the ceiling steady — a slow-motion cut delivered in 100–200bps increments. The tax rate raise (18.5% → 19%) compounds the EPS pressure. This is the third consecutive quarter in which the FY26 profit envelope has degraded relative to the initial FY26 framing.

Note: No earnings call transcript was available for this quarter; tone analysis is drawn from press-release disclosures and multi-quarter guidance patterns rather than management commentary or Q&A.

Answers to last quarter's watch list

Whether CIS Q2 growth re-accelerates toward 50%+ — CIS printed +39% YoY in Q2 ($99M), a second consecutive quarter running below the withdrawn "at least 50%" FY guide. Management has now withdrawn the FY26 CIS growth guide entirely rather than reset it, replaced by a $2.8B cumulative multi-year contract disclosure. The dollar trajectory is intact; the growth-rate acceleration thesis is not.

Resolved negatively

A third large inference customer commitment, or pipeline detail beyond the $1.8B contract — Management disclosed cumulative signed multi-year CIS contracts of "over $2.8 billion" year-to-date, including a newly named $600M+/4-year contract with a new U.S.-based technology customer for robotics development. This is a second explicitly named mega-deal on top of the Q1 $1.8B anchor.

Resolved positively

Q2 CapEx landing within the $433–$453M range — Q2 CapEx of $346.5M (31.5% of revenue, accrual basis) landed $86–107M below the guided range and 850–950bps below the 40–41% guide. This is either delivery-timing slippage of GPU/co-location capacity or a more restrained deployment pace than Q1's framing implied. Management did not upsize FY26 CapEx as Ed's "couple hundred million" incremental commentary suggested.

Not resolved

Delivery YoY trajectory — Delivery printed -6% in Q2 versus -7% in Q1, a one-point narrowing but still well below Q4 FY25's -2% stabilization print. Two consecutive quarters at -6 to -7% confirm the Q1 break from stabilization was structural, not a one-quarter reversal.

Resolved negatively

Q2 non-GAAP operating margin within 25–26%, and whether 26% FY is floor or ceiling — Q2 margin landed at 25%, the low end of the guide. The FY26 margin guide was then widened downward to 25–26% (from a fixed 26%), formally establishing 26% as the ceiling and 25% as the new floor. The FY26 margin ceiling held; the floor moved down.

Resolved negatively

Initial revenue recognition timing on the $1.8B contract — No specific disclosure of 2026 revenue contribution from the $1.8B contract on the press-release print. The $2.8B cumulative disclosure is a signings metric, not a revenue-recognition schedule. With no transcript, the ramp cadence remains unresolved.

Continue monitoring

What to watch into next quarter

Whether CIS Q3 growth re-accelerates from +39% or a third consecutive print at ~40% forces the withdrawn FY guide to be replaced with something explicitly lower. The Q3 revenue guide of $1.105–$1.130B implies modest overall acceleration; CIS needs to carry disproportionate weight given Delivery is running at -6%.

Initial revenue-recognition timing on the newly named $600M/4-year robotics contract — whether any dollars begin in 2026 or the ramp is fully back-end-loaded, and how it interacts with the $1.8B contract cadence. A 4-year duration vs. the $1.8B/7-year anchor implies a materially steeper annual run rate on the robotics deal if evenly ramped.

Q3 non-GAAP operating margin landing within the 24–26% range. The Q3 guide low end at 24% is 100bps below Q2's actual and 200bps below the FY26 low end — meaning management is signaling further sequential margin compression before any recovery. A print at 24% would put the FY26 25% floor at material risk.

Whether Q3 CapEx catches up the Q2 undershoot toward the FY26 40–42% guide, or whether the FY26 CapEx envelope is quietly walked down. Q2's 31.5% run rate annualizes well below the FY guide; management has not restated the FY CapEx target.

Delivery YoY trajectory. A third consecutive quarter at -6% or worse would push cumulative annual Delivery decline toward -6 to -7%, which materially degrades the non-AI base that funds the AI investment cycle.

Security revenue growth — held at +10% for three consecutive quarters and now running slightly below the +11% trend from FY25. Any further deceleration would compound the P&L pressure that produced this quarter's FY26 guide cut.

Sources

Akamai Q2 2026 Press Release / Form 8-K Exhibit 99.1 — https://www.sec.gov/Archives/edgar/data/1086222/000108622226000083/exhibit991-q22026.htm
Akamai Q1 2026 Tapebrief coverage (prior-quarter guidance baseline)
Akamai Q4 2025 Tapebrief coverage (FY26 initial guide baseline)

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