Shares of Limelight Networks (EGIO -2.89%) have plunged today, down by 13% as of noon EDT, after the content delivery network (CDN) specialist reported first-quarter earnings. The results beat expectations and Limelight modestly boosted its guidance. It also announced a CFO transition.
Revenue in the first quarter increased 32% to $57 million, ahead of the $54.7 million in sales that analysts were modeling for. That all translated into break-even adjusted earnings per share. The consensus estimate called for an adjusted net loss of $0.02 per share. Adjusted EBITDA in the first quarter was $5.6 million.
The tech company also said that current CFO Sajid Malhotra would transition to a new role of chief strategy officer, where he will be in charge of corporate strategy, mergers and acquisitions, and investor relations. Limelight is promoting finance exec Dan Boncel to CFO, effective July 1.
The novel coronavirus outbreak has underscored the importance of CDNs, which help facilitate video-streaming services and other critical online services as people stay at home. Considering the vital role of CDNs right now, investors may have been pricing in higher expectations for 2020, as shares had tapped 52-week highs last week.
"As COVID-19 disrupts operations around the world, we believe that Limelight plays an important role in supporting the digital experience of the global population under isolation mandates," CEO Robert Lento said on the conference call with analysts. "As such, the services we provide to our customers and our customers' customers are more important than ever."
Limelight slightly increased its revenue forecast for 2020, boosting the low end of guidance by $2 million while leaving the high end unchanged, thereby increasing the midpoint. Revenue this year is now expected to be $225 million to $235 million. Limelight did not adjust other aspects of its outlook.