Akamai's Growth Driven by Security and Enterprise Compute Solutions

Akamai's market-leading security products drive enterprise growth despite economic challenges, emphasizing the need for reliable defenses.

### Akamai's Strong Quarter: Security and Enterprise Compute Driving Growth
* 💼  Akamai's market-leading security products and enterprise compute business were key factors in the company's **strong performance in the quarter**.
* 💰  The enterprise compute business is expected to reach a **$100 million annual revenue run rate** by the end of the year, showing **significant growth potential**.
* 🔒  Akamai's security offerings are in high demand, especially in the current environment of **increased cyber attacks and data security concerns**.
* 🏢  The company's ability to provide **better performance at a lower price point** in the enterprise compute space is driving adoption among major enterprises.
* 🌐  CEO Tom Leighton highlighted the importance of **reliability** in the wake of recent cyber incidents, emphasizing the need for **phased updates** and **vendor selection**.
* 🛡️  While Akamai did not directly benefit from the CrowdStrike incident, the company's experience in **handling large-scale updates and DDoS attacks** provides **valuable insights for the industry**.
* 🔒  Leighton stressed the ongoing importance of DDoS protection, citing a recent attack as **one of the largest in history** and underscoring the need for **state-of-the-art defenses**.
* 💬  Leighton's comments suggest that recent cyber incidents are prompting enterprises to **reevaluate their security strategies** and consider vendors that prioritize **reliability and investment in protection**.

What were the specific factors in the quarter that put Akamai up from. Well, we have several market-leading powered products and security, obviously very important today given the large number of damaging attacks, ransomware, data exfiltration. And our enterprise compute business doing very well. You know, we talked about just really getting started in that aspect of the business this year. And now we think we'll exit the year at a $100 million a year annual run rate in revenue with a lot of exciting potential for the future. And I think those are great proof points that investors are now seeing. On the enterprise side, I find that very interesting. Is it demonstrative of broad strength in your client base, those industries sort of willingness to spend, or is there something specific that Akamai is doing that allows you to sort of outperform in a difficult environment? Well, security is important for every major enterprise, even in tough economic

times, which we're seeing some of now. And we have the market-leading products, and the major enterprises really need them to be safe. And in compute, I think we have a very compelling value proposition. We can provide better performance at a much lower price point. And when you can do that and help a major enterprise save money, well, this is a good time to be able to have that happen. Tom strength in the areas he outlined complete security and then a little weakness in KD. And I would like to talk about what's happening in your industry overall. I think we start with CrowdStrike Endpoint Specialist. You spent, what was that week a situation like for Akamai? Was there any tangible positive read-through for you or any way that you capitalized on what happened? Well, we don't use that software ourselves. So, there was no impact to Akamai, and we helped our customers where we could.

But that was in an area where we don't really do business. I think there were a lot of learnings for the industry as a whole. You know, first and really is clear, you just can't be doing updates all at once everywhere in the world. You know, most of the time that's okay. But eventually, you're going to have an unintended consequence. And if you update the entire world at one time, you've got a disaster. You know, that's a lesson we learned at Akamai pretty painfully about 20 years ago. And ever since then, you know, we phase our updates after you've been through Q A and you're confident. You still just go one stage at a time. So in case there's something that was unanticipated, you catch it before you cause a problem. I think also there's a much better understanding that reliability matters and it takes a lot of investment. But you see what happens when you

have something like this. I think enterprises will pay a lot more attention to reliability going forward. I hear you on that. I'm not a cyber expert by any means. And I know that a lot of CIOs, cyber managers, and CISOs watch this program. And for them, top of mind is this sort of academic debate agent versus agent, less delivery or security of that delivery of security. Do you see, though, away from the academic debate on the best security systems action, your enterprise customers saw the news cycle and picked up the phone and said, we are changing how we do cyber. No, they're you know, they were just trying to get out of the disaster. I think going forward, there'll be a time of reflection into how do you prevent this from happening? How do you keep a vendor from, you know, having this consequence? And it's not just a situation of having multiple vendors because it might even

increase the problem, because if any one of them has a big issue, you've got a problem. But really selecting vendors who put the extra effort and investment into making sure things stay reliable, as reliable as possible. Tom, I guess closer to home for you, a higher profile attack on Azure in June. What did you make of that and Microsoft's handling it and how did it impact you? You know, DDoS attacks are probably the oldest kinds of cyber attacks out there. They go back more than 20 years as well. You know, that's an area where we have leading services to help defend customers. In fact, you know, just last week, we saw one of the top ten detox attacks of all time coming out of the Middle East. You know, with the the war there, we're able to defend a very important financial enterprise from that kind of an attack. So even though it's been around a long

time. We are still seeing some very large DDoS attacks. And it's important for enterprises to have state-of-the-art defenses even today.

Akamai Gains After Results and Raising Forecast

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Bloomberg Technology

Akamai's growth is driven by market-leading products in security and a successful enterprise compute business, with a projected $100 million annual run rate in revenue.

The company's strong value proposition, offering better performance at a lower price, is appealing to major enterprises, especially during tough economic times.

Akamai's response to industry challenges, including the CrowdStrike situation, did not directly impact them, but they focused on helping their customers.

Lessons Learned from Global Updates and Cybersecurity

The speaker emphasizes the importance of not conducting global updates all at once to avoid unintended consequences.

They highlight the need for phased updates and investing in reliability to prevent disasters.

The recent events have prompted enterprise customers to reflect on their cybersecurity practices and consider ways to prevent similar incidents in the future.

The Impact of Cyber Attacks on Reliability

Cyber attacks, particularly DDoS attacks, have been a longstanding issue for over 20 years.

Selecting reliable vendors is crucial for maintaining stability and defense against such attacks.

Microsoft's recent high-profile DDoS attack on Azure highlighted the ongoing threat, but the company is actively working to defend customers and mitigate the impact of these attacks.

DDoS attacks remain a significant threat, with some being very large in scale.

Enterprises need to invest in state-of-the-art defenses to protect against these attacks.

The importance of robust cybersecurity measures is crucial in today's digital landscape.