Akami Technologies (NASDAQ: AKAM) CEO and founder Tom Layton outlined the company’s growth priorities and how management is positioning the business for the AI-driven shift in Internet workloads, speaking in a discussion led by senior communications analyst Frank Luthan at the Raymond James Conference.
Layton said most of Akami’s revenue comes from securities, which he describes as 10% growth. He pointed to Akami’s “market-leading” products in areas such as web application firewall (WAF), DDoS mitigation, and bot management, and said new offerings—including API security and guardcore—are growing “very quickly.”
→ Defense stocks are on the rise — aerospace earnings could close the gap
In Q4, Layton said the API Security and Guardicore segments delivered $90 million in revenue, up 35% year over year, and he identified those products as key drivers of future growth. He also said that Akami is investing in AI-related security capabilities, arguing that as companies adopt more AI, it creates a significant new attack surface.
Layton pointed to cloud infrastructure services as the fastest-growing product area, saying the segment ended Q4 at $94 million, up 45% year over year. He added that the company expects to accelerate growth over the course of the year and said Akami is “seeking 45%-50% revenue growth” for its business.
→ Supermicro: Why NVIDIA Shadow is a useful niche
He framed Akaami’s accounting strategy as an extension of what the company was already doing in content delivery and security: placing capabilities closer to users. By placing computing logic closer to end users, he said, Akaami can deliver lower latency, improved scalability, higher reliability, and competitive pricing.
As a proof point, Layton said “all hyperscalers” use Akamai’s computing platform for mission-critical use cases despite having their own cloud platforms, because Akamai can provide better performance for latency-sensitive workloads. Examples he shared include:
Live video: Layton said one Hyperscaler uses Akamai for live sports streaming, in part to synchronize viewing so “everyone sees the action at the same time,” which he noted could be important for betting-related applications.
Ad Selection: Another hyperscaler uses Akami for ad selection, which he described as a use case where acceleration is done locally.
Business Activity: He said businesses rely on performance and reliability, and that rich, AI-driven user experiences can translate to higher conversion rates where speed matters.
Real-time tool and robotic management: Layton pointed to a large new customer with capabilities to manage fleets of robots, vehicles and automation systems that require real-time response.
→ IonQ in rebound mode: buy the article, respect the risk
Layton emphasized that, in his view, AI inference and AI “agents” will be major future drivers of computing demand, especially as new hardware enables faster model response times. He argued that as AI becomes more video-centric and personalized, distributed infrastructure will be required not only for latency but also for bandwidth and synchronization, challenges comparable to large-scale live sports streaming.
Regarding Akami’s Inference Cloud initiative, Layton said the company is a 250 million dollars investment And a great purchase Blackwell 6000 systems. The first installment was deployed in 20 cities last fall and is expected to reach general availability by the end of the quarter, he said, adding that it is already selling out of beta customers.
Layton said the company is now deploying the largest installment and that a “good portion” has already been committed under a four-year contract with a major customer. He said revenue from the now-deployed installment will likely start “by the end of the year” with a major impact expected next year, noting that the company must acquire, deploy and activate servers before they can be used.
While highlighting Akamai’s status as the operator of what he called the world’s largest, most reliable and most scalable content delivery network, Layton also discussed ongoing pressure on the delivery side. He said that he had instructed Akami A decrease in average single digits In delivery revenue for the year, traffic revenue is defined as the combination of traffic growth and price reduction per unit.
Layton said the company remains disciplined on pricing, including not picking up certain businesses and cutting some large “light events” if the economy is not attractive. He added that the series of traffic accidents has improved compared to last year and he hopes that this series will continue. He also said that Akaami is generally paid more than competitors for delivery, depending on the product, because of performance and reliability.
Regarding security prices, Layton said prices are holding up well and that the company expects to raise prices in some cases this year, partly due to higher memory costs. He said Akami guessed that one An additional $200 million This year the cost impact is only due to increased memory. He added that this is not a barrier to growth and said that Akaami can get the parts it needs, but it is aligned with keeping older servers in long-term service and reducing memory purchases where possible.
Regarding capital allocation, Layton said that Akaami generally buys back equity distributed to employees and buys back additional shares on occasion, averaging about 1% of dividends per year. He said the company was about to repurchase 800 million dollars Last year, in part related to the changing transaction, and no change in strategy was noted. He said the capital is also used to drive business for M&A and ongoing CapEx.
On M&A, Layton said that Akamai is looking at both security and computing, describing security as fast-paced and saying the company is excited about acquisitions including Noname (API security) and Guardicore (micro-segmentation). He emphasized discipline over value and said potential deals would likely be closer to products that align with the current platform and align with known customer and sales dynamics.
Finally, Layton addressed an important investor misconception: that Akaami is still viewed primarily as a CDN company. He said investors increasingly recognize Akami as a cloud company with rapid growth, again pointing to meaningful scale in cloud infrastructure services and the fact that Hyperscale is a customer of Akami’s cloud business.
Akamai Technologies, Inc. is a leading provider of content delivery network (CDN) services and cloud security solutions designed to improve and secure digital experiences. Leveraging a globally distributed platform, the company accelerates web and mobile content delivery for enterprises, media companies, e-commerce platforms and government agencies. Its edge computing architecture brings processing power closer to end users, reducing latency and improving application performance across geographies.
The company’s core offerings include content acceleration, web and mobile performance optimization, media delivery, and a suite of cybersecurity solutions that protect against DDoS attacks, application-layer threats, and bot-driven fraud.
The article “Akamai Technologies CEO Details AI Inference Cloud Push, 45%-50% Cloud Growth at Conference” was originally published by MarketBeat .
