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Why Fastly Stock Jumped on Thursday

By Daniel Sparks – Updated Oct 1, 2020 at 4:36PM

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The edge-computing specialist locked in an acquisition of a company that will help it launch a new security offering.

What happened

Shares of edge-computing specialist Fastly (FSLY -4.68%) jumped on Thursday, rising as much as 6.7%. By the time the market closed, the stock was up 4.5%.

The stock's gain came as Fastly closed its acquisition of Signal Sciences, a developer-friendly programmable security solution. Also likely helping Fastly stock today was optimism in the overall stock market.

A digital-looking cloud

Image source: Getty Images.

So what

Fastly's agreement to acquire Signal Sciences was announced in late August. On Monday, Fastly made that planned acquisition official, taking full control of the security company. Signal Sciences will help the edge-computing company take a step toward a modernized programmable security offering, Fastly said in a press release about the acquisition on Thursday.

In addition to bringing Signal Sciences' security expertise over to Fastly, the acquisition brings over 150 customers, management said.

Fastly stock likely also benefited from a bullish day in the overall stock market. The Nasdaq finished the trading day up 1.4%.

Now what

Building on this acquisition, Fastly and the Signal Sciences team will work together to launch [email protected], a unified web application and API (application programming interface) protection solution. In addition, Fastly plans to continue offering Signal Sciences' agent-based security model for on-premise, cloud, and hybrid use.

Fastly says the acquisition will enable it to "roll out innovative products quickly and smoothly."

Daniel Sparks owns shares of Fastly. The Motley Fool owns shares of and recommends Fastly. The Motley Fool has a disclosure policy.

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