On Wednesday, Motley Fool Rule Breakers pick Akamai Technologies (NASDAQ:AKAM) released earnings for the second quarter ended June 30.

  • Although our table reports data in GAAP, the content-delivery specialist prefers to exclude stock-based compensation, depreciation and amortization, and other non-cash charges in giving guidance.
  • On that basis, Akamai booked $0.30 in per share earnings during Q2, up 50% year over year.
  • Revenue also climbed by more than 50%. But free cash flow declined because of higher capital expenditures. Capex spent on network infrastructure such as servers rose by 138%.
  • That doesn't seem to bother investors. The professional and amateur stock pickers following Akamai in our Motley Fool CAPS investor-intelligence database give it four out of five stars.

(Figures in thousands, except per-share data)

Income Statement Highlights

Q2 2007

Q2 2006

Change

Sales

$152,654

$100,649

51.7%

Net Profit

$21,646

$11,264

92.2%

EPS

$0.12

$0.07

71.4%

Diluted Shares

185,601

175,612

5.7%

Get back to basics with a look at the income statement.

Margin Checkup

Q2 2007

Q2 2006

Change*

Gross Margin

73.95%

78.94%

(4.99)

Operating Margin

20.28%

17.18%

3.10

Net Margin

14.18%

11.19%

2.99

*Expressed in percentage points.

Margins are the earnings engine.

Balance Sheet Highlights

Assets

Q2 2007

Q2 2006

Change

Cash + ST Invest.

$355,250

$259,261

37%

Accounts Rec.

$99,157

$63,963

55%

Liabilities

Q2 2007

Q2 2006

Change

Accounts Payable

$71,933

$61,260

17.4%

Long-Term Debt

$199,960

$200,000

(0%)

The balance sheet reflects the company's health.

Cash Flow Highlights

Q2 2007

Q2 2006

Change

Cash From Ops.

$37,329

$27,746

34.5%

Capital Expenditures

$29,692

$14,227

108.7%

Free Cash Flow

$7,637

$13,519

(43.5%)

Free cash flow is a Fool's best friend.

Related Foolishness:

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Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.

Fool contributor Tim Beyers owned shares of Akamai at the time of publication. Find Tim's portfolio here and his latest blog commentary here. The Motley Fool's disclosure policy always adds up.