Shares of Fastly (FSLY +13.69%) spiked on Wednesday following the cloud platform's investor day event.
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Living on the edge
Fastly's platform combines a content delivery network, cybersecurity, and edge computing to help its customers deliver faster and more reliable online experiences, while also reducing costs.
By bringing delivery, security, and compute together in one unified platform, Fastly is positioning itself to capture a larger share of the artificial intelligence (AI)-driven shift to edge networks. Fastly says AI traffic is growing 6.5 times faster than human traffic on its platform.
Fastly's platform-based approach also makes it easier to cross-sell its offerings. Thirty percent of its large customers have adopted four or more of its products.
NASDAQ: FSLY
Key Data Points
These and other encouraging trends gave Fastly's leadership the confidence to issue ambitious 2029 financial targets. Management expects:
- Revenue of $1.1 billion to $1.3 billion, signifying annualized growth of 14% to 21% from 2026 to 2029
- Gross margin of 67% to 71%
- Operating margin of 20% to 22%
- Free cash flow yield of 12% to 15%
Multiple growth catalysts
AI security is likely to be a significant driver of these gains. On Monday, Fastly launched its AI Firewall and AI Runtime Control capabilities to give its customers the means to better protect and monitor their AI systems.
Fastly also stands to benefit from the surging popularity of Meta Platforms' new personal AI agent, Muse. Fastly reportedly handles a sizable portion of Muse's internet traffic.
