Content delivery network (CDN) specialist Limelight Networks (LLNW +0.00%) reported earnings on Monday evening. The company reduced its bottom-line losses based on the highest year-over-year revenue growth in Limelight's history. Moreover, Limelight's management has their eyes on exciting growth strategies for the next few years.
Limelight's second-quarter results by the numbers
|
Metric |
Q2 2020 |
Q2 2019 |
Change |
Analyst Consensus |
|---|---|---|---|---|
|
Revenue |
$58.6 million |
$45.9 million |
28% |
$56.7 billion |
|
GAAP net income (loss) |
($1.59 million) |
($6.94 million) |
77% |
N/A |
|
Adjusted earnings (loss) per diluted share |
($0.01) |
($0.03) |
67% |
$0.01 |
Data source: Limelight Networks. GAAP = generally accepted accounting principles.
Diving deeper
In a call with Yours Truly after the report, Chief Strategy Officer Sajid Malhotra said that 2020 will go down as a tipping point in Limelight's history.
This is a good time for the industry and a particularly good time for us. We have never grown sales by 10% and here we are thinking about growing 15%-plus in 2020. So our growth is accelerating, the profitability of the business is accelerating.The patent lawsuits and all of that is all behind us and we are working in a good industry, in a good neighborhood. Even in the pandemic, we're working in one of the select few industries that are actually doing better because of the pandemic.
Image source: Getty Images.
On the earnings call, CEO Bob Lento explained that Limelight's CDN business is booming thanks to a plethora of video-streaming service launches over the last year, but the recently launched edge computing services may turn out to be the larger growth driver in the long run.
"If you go by the numbers that the analysts are providing, it is many times larger than the market for CDN. How much of that is addressable with our customer base remains to be seen," Lento said. "No matter how we try to slice it, it always comes out that the market for edge services is bigger than the market for CDN."
Limelight's stock has more than tripled over the last year as the video-streaming landscape gained several new players. The company is in a good position to build on this early success as the streaming market matures. Tuesday's falling share prices look like an invitation to pick up Limelight shares at a temporary discount.
