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Akamai’s International Markets Showing Strong Growth Potential

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Mar. 6 2018, Published 1:11 p.m. ET

International and domestic market growth

As the leading cloud delivery platform, Akamai Technologies (AKAM) is expanding its overseas market, driven by its strong product portfolio. The international market, which comprised nearly 35.0% of its total revenues, grew at a whopping 21.4% YoY (year-over-year) to nearly $234.0 million in 4Q17. However, on a constant currency basis, it gained 17.0% YoY. 

In fiscal 2017, Akamai’s overseas business garnered ~$855.0 million in revenues, up 18.9% YoY. Likewise, the US market grew at a slower pace of 1.5% YoY to nearly $430.0 million. In 2017, the domestic market generated nearly $1.6 billion in revenues, up 1.7% YoY.

In the graph above, we can see the total revenue growth from the international market in the last five quarters for Akamai. During the period, it grew at a CAGR[1. compound annual growth rate] of 5.0%.

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What’s driving international growth? 

This strong revenue growth in the international markets is primarily buoyed by robust demand in the Asia-Pacific region. Increased usage of the Internet to watch videos and shop online has increased the demand for improved and more secure content delivery platforms.

Akamai offers support to companies such as Netflix (NFLX), BestBuy (BBY), Audi, and BNP Paribas through products like Image Manager and Bot Manager. The company teams up with large global carriers such as Telefonica (TEF) and Turk Telecom, which could boost the company’s international business.

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