Internet applications and content delivery solutions provider Akamai Technologies Inc. (AKAM) Monday raised its guidance for profit and revenue in the fourth quarter, citing better-than-expected performance in the first two months of the quarter.
The Cambridge, Massachusetts-based company now expects normalized earnings to be in the range of $0.42-$0.43 per share. The previous forecast was for normalized earnings of $0.39-$0.41 per share.
On average, 21 analysts polled by Thomson Reuters expect the company to earn $0.40 per share for the quarter with estimates ranging between $0.39 per share and $0.44 per share. Analysts' estimates typically exclude special items.
On a GAAP basis, the Web video delivery company expects $0.19-$0.20 per share for the fourth quarter.
Revenue for the fourth quarter is now expected to be in the range of $230 million to $235 million. This is an estimated increase of about 8%-11% from the fourth quarter of 2008. The previous estimate was for fourth-quarter revenue of $217 million-$224 million or 2%-5% growth.
Analysts expect revenue in the range of $218.10 million-$223.60 million with a consensus of $220.98 million.
Commenting on the guidance revision, JD Sherman, CFO of Akamai, said, "The first two months of the fourth quarter tracked above our expectations. We have been seeing stronger volume growth this quarter as compared to the same quarter last year in our commerce and media verticals, and we anticipate this trend will continue through the end of the year."
In late October, the company reported a 2% drop in profit for the third quarter, reflecting higher expenses, despite a 5% growth in revenues. The company's net income for the third quarter slipped to $32.7 million from $33.4 million in the year-ago quarter. On a per share basis, earnings were flat with last year at $0.18. Revenue for the third quarter was $206.5 million, up 5% from $197.3 million in the year-ago quarter.
AKAM closed Friday's regular trade at $24.98, up from the previous close of $23.77, on 8.26 million shares. For the past year, the stock traded in the range of $11.26-$25.66.
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