Fastly (NASDAQ:FSLY) Releases Earnings Results, Beats Expectations By $0.05 EPS

Fastly (NASDAQ:FSLY) issued its quarterly earnings results on Wednesday. The company reported $0.17 EPS for the quarter, topping the consensus estimate of $0.12 by $0.05, FiscalAI reports. The business had revenue of $190.19 million for the quarter, compared to analysts’ expectations of $187.82 million. Fastly had a negative net margin of 11.80% and a negative return on equity of 6.31%.

Here are the key takeaways from Fastly’s conference call:

• Fastly reported record Q3 revenue of $190.2 million, up 20% year over year, with a 65.8% gross margin, $31.2 million in non-GAAP operating income and $25 million in free cash flow.
• The company raised its 2026 revenue outlook to $744 million–$748 million and operating profit outlook to $107 million–$111 million, and lifted free cash flow guidance to $50 million–$60 million. Q4 revenue guidance implies 16% year-over-year growth at the midpoint, below the recent 20% pace.
• Customer expansion remained strong: trailing 12-month net retention rose to 119%, while 34% of large customers now use at least four product suites. Security revenue grew 32% year over year.
• Growth was concentrated among the largest customers: the top 10 accounted for 39% of revenue and grew 46% year over year, while revenue from customers outside the top 10 grew 8%. Management said broader go-to-market investments may take time to improve growth in that group.
• Go-to-market leader Scott Lovett plans to retire next year, and CEO Kip Compton and Lovett will lead a search for a successor. Management expects continuity during the transition, citing Lovett’s continued involvement and the strength of the leadership bench.

Fastly Stock Performance

Shares of FSLY traded down $5.63 during midday trading on Thursday, hitting $15.39. 10,656,197 shares of the stock traded hands, compared to its average volume of 8,883,077. The business’s 50 day moving average price is $24.30 and its two-hundred day moving average price is $21.45. The firm has a market capitalization of $2.45 billion, a PE ratio of -29.20 and a beta of 0.22. The company has a debt-to-equity ratio of 0.33, a quick ratio of 3.36 and a current ratio of 3.36. Fastly has a 1-year low of $7.87 and a 1-year high of $34.82.

Insider Activity

In other news, insider Jeffrey Ford sold 45,832 shares of the business’s stock in a transaction that occurred on Thursday, September 17th. The stock was sold at an average price of $24.65, for a total transaction of $1,129,758.80. Following the completion of the transaction, the insider directly owned 249,861 shares in the company, valued at approximately $6,159,073.65. The trade was a 15.50% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Scott Lovett sold 41,815 shares of the firm’s stock in a transaction that occurred on Thursday, September 17th. The shares were sold at an average price of $24.64, for a total value of $1,030,321.60. Following the completion of the sale, the insider owned 1,281,583 shares in the company, valued at approximately $31,578,205.12. This represents a 3.16% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 1,334,973 shares of company stock worth $35,706,621 over the last three months. Insiders own 4.20% of the company’s stock.

Fastly News Summary

Here are the key news stories impacting Fastly this week:

• Positive Sentiment: Fastly reported record Q3 revenue of about $190.2 million, up 20.2% year over year, and adjusted earnings of $0.17 per share versus the $0.12 consensus estimate. Security sales rose 32%, with growth also supported by deeper customer use of its platform. Fastly Q3 earnings beat estimates
• Positive Sentiment: Management raised its 2026 outlook, projecting revenue of $744 million to $748 million and free cash flow of $50 million to $60 million. Q4 revenue guidance of $198 million to $202 million also came in above analysts’ expectations. 2026 revenue and free cash flow outlook
• Neutral Sentiment: Go-to-market president Scott Lovett plans to retire in 2027, and Fastly is beginning a search for a chief revenue officer. The transition is not immediate, but investors may watch for its effect on sales leadership. Fastly leadership transition announcement
• Negative Sentiment: Some analysts cut their price targets while maintaining neutral or sector-perform ratings: Piper Sandler lowered its target to $24 from $28, and RBC cut its target to $19 from $25. These reductions may have weighed on sentiment amid the post-earnings decline. RBC cuts Fastly price target
• Negative Sentiment: Despite stronger Q4 guidance, reports noted that growth is expected to decelerate in the quarter, a potential concern for investors weighing Fastly’s longer-term growth trajectory. Fastly Q3 earnings call highlights

Wall Street Analyst Weigh In

Several research firms recently issued reports on FSLY. Evercore reissued an “outperform” rating on shares of Fastly in a research report on Wednesday, September 23rd. Oppenheimer raised shares of Fastly from a “market perform” rating to an “outperform” rating and set a $35.00 price objective for the company in a report on Friday, October 9th. Canaccord Genuity Group began coverage on shares of Fastly in a research note on Friday, July 17th. They set a “buy” rating and a $27.00 target price for the company. Weiss Ratings reissued a “sell (d-)” rating on shares of Fastly in a report on Friday, August 7th. Finally, Freedom Broker raised their price target on shares of Fastly from $32.00 to $37.00 and gave the stock a “buy” rating in a research report on Wednesday, September 23rd. One analyst has rated the stock with a Strong Buy rating, seven have assigned a Buy rating, five have given a Hold rating and two have assigned a Sell rating to the stock. According to MarketBeat, Fastly currently has a consensus rating of “Hold” and a consensus price target of $26.67.

Fastly Company Profile

Fastly, Inc is a technology company that provides an edge cloud platform designed to help businesses deliver, secure, and optimize digital applications and content. Its platform processes data and applications closer to end users, supporting faster performance, improved reliability, and greater control over internet-based services.

Fastly’s products and services include content delivery, application programming interface (API) acceleration, edge computing, application and API security, bot management, distributed denial-of-service protection, and observability tools.