CDSA

Akamai reported strong results for its first quarter (ended March 31) that Tom Leighton, its CEO, said was “driven by the continued rapid growth of our security business, accelerated growth in our edge applications business and continued high traffic levels on our Intelligent Edge Platform.”

The company’s security solutions portfolio “performed especially well in Q1,” generating revenue of $310 million, up 29% from a year ago, he said May 4 on an earnings call with analysts.

“Very strong growth was experienced across most of our security products, including our new Page Integrity Manager solution,” he said, noting Page Integrity Manager helps enterprises defend against malware and third-party software and applications.

Customers that adopted Page Integrity Manager in Q1 included container shipping operator Maersk and Groupon, he told analysts.

Akamai’s Bot Manager solution also “continued to perform very well in Q1,” he said, noting Bot Manager was designed to mitigate a wide variety of automated attacks, including account stuffing attacks in which credentials stolen from one website are checked for validity at thousands of other websites. When valid credentials are found, a manual attack is often then used to extract value from the compromised accounts.

Losses from account takeovers and new account fraud are estimated at more than $10 billion annually in the U.S., he pointed out.

Akamai also launched a beta test for its new Account Protector solution in Q1, he noted, explaining: “Account Protector shields organizations from account takeover and other kinds of fraudulent human activity without increasing friction for legitimate customers. Account Protector works by detecting in real time whether a user logging into an application is the legitimate account owner or an imposter in possession of stolen credentials.”

One of Akamai’s beta customers for that new solution is a well-known restaurant franchise he didn’t identify name that was “under attack by cyber criminals who were compromising the loyalty accounts of their diners,” he said, adding: “The criminals were stealing loyalty reward points and then reselling them on the dark web. The digital theft outraged the diners whose points were stolen and angered restaurant owners who unknowingly provided meals to fraudsters. With help from Akamai, the franchise can now identify the situations where humans are impersonating valid diners, and take action to stop the illicit transfer of loyalty points, thereby stopping the fraud and enabling the franchise to focus on accelerating sales.”

The company was also “excited about the success of Akamai’s fastest growing security segment, Access Control, which reached an annualized revenue run rate of $100 million in Q1, up more than 170% over Q1 of 2020 and up over 60% organically,” he told analysts.

The Access Control segment provides secure connectivity for users, applications, workloads and Internet of Things (IoT) systems, regardless of their location, he noted.

Turning to Akamai’s Content Delivery Networks (CDN) business, he said Q1 “marked another quarter of very strong traffic growth for Akamai, led by” over-the-top (OTT) video services and downloads of e-gaming software.

On March 16, traffic on the Akamai platform hit an all-time high of 200 terabits per second, he said, noting that was 19% higher than the peak in Q1 of last year and two and a half times the traffic peak in Q1 of 2019. “Daily peaks were also high in Q1, averaging 143 terabits per second,” he said, adding: “In fact, traffic on our platform exceeded 110 terabits per second pretty much around the clock in Q1.”

Overall, Akamai CDN products and services generated revenue of $532 million in Q1, up 2% from a year ago. The Edge application segment generated $45 million in revenue, up more than 30% over Q1 of 2020.

As Akamai discussed during its recent Investor Summit, “we believe that there’s the potential for substantial future growth in the area of edge computing, as we anticipate more enterprises moving their compute workloads to our edge platform for offload, improved performance, security and global scale,” he told analysts.

Total Akamai Q1 revenue grew 10% from a year ago to $843 million, while profit increased 26% to $156 million, with earnings per share surging to 94 cents from 75 cents.