Akamai Technologies secures $100m cloud partnership as financial results highlight cloud expansion momentum

Akamai Technologies, Inc. (NASDAQ: AKAM), a leader in cloud computing services and cybersecurity infrastructure, has signed a multi-year strategic cloud partnership with one of the world’s largest technology companies. The agreement, valued at over $100 million, will see the customer integrate Akamai’s full-stack cloud solutions to strengthen its digital infrastructure.

This deal comes as Akamai Technologies accelerates its cloud computing expansion, positioning itself as a viable alternative to traditional hyperscalers such as Amazon Web Services (AWS) and Microsoft Azure. The customer will have full access to Akamai’s distributed cloud platform, leveraging its low-latency, high-security infrastructure to optimize global operations. This shift signals an increasing demand for cybersecurity and infrastructure solutions that prioritize cost efficiency, real-time security, and enterprise scalability.

Adam Karon, Akamai’s Chief Operating Officer and General Manager of the Cloud Technology Group, highlighted that businesses with a massive global presence require sophisticated cloud security and infrastructure to ensure seamless performance for users worldwide. He emphasized that Akamai’s cloud computing services provide the reliability and scale necessary for large enterprises to securely manage massive data flows and digital applications.

How do Akamai’s financial results reflect its cloud computing growth?

Akamai’s latest financial results for Q4 and full-year 2024 underscore its increasing focus on cloud computing services as a key revenue driver. The company reported $3.991 billion in total revenue for 2024, reflecting a 5% year-over-year increase, with cloud security and compute services accounting for 67% of overall revenue.

In Q4 2024, Akamai Technologies generated $1.02 billion in revenue, marking a 3% increase from Q4 2023. Notably, its compute segment—which includes cloud infrastructure services—grew 25% year-over-year, reaching $167 million in Q4 and $630 million for the full year. This growth highlights the company’s successful shift toward enterprise cloud solutions, positioning it as a competitor to dominant cloud providers.

Despite challenges in its legacy content delivery business, where delivery revenue declined by 15% year-over-year, Akamai’s strategic cloud partnership reinforces its commitment to cloud computing expansion. The $100 million cloud computing services agreement will further bolster its financial trajectory, enhancing its ability to attract enterprise cloud clients seeking cost-effective, secure, and high-performance cloud platforms.

Why are enterprises choosing Akamai for cloud security and infrastructure?

With enterprises prioritizing cybersecurity and infrastructure alongside cloud computing services, Akamai’s expertise in cyber threat intelligence and distributed cloud security has become a key differentiator. The company’s full-stack cloud security offerings protect against ransomware attacks, distributed denial-of-service (DDoS) threats, and data breaches, making it an attractive choice for enterprises looking to safeguard critical workloads.

Akamai’s managed Kubernetes clusters, virtual private cloud (VPC) environments, and advanced load-balancing solutions are core components of its cloud computing services. These capabilities allow enterprises to enhance application security, manage global traffic, and ensure regulatory compliance, positioning Akamai’s cloud infrastructure as a scalable, secure alternative to traditional cloud providers.

The strategic cloud partnership also aligns with Akamai’s push for high-performance cloud computing solutions that prioritize low-latency operations. As part of this agreement, Akamai will enable its customer to manage traffic and data locally, ensuring faster processing times and improved user experiences across global markets.

How does Akamai’s cloud expansion impact its profitability?

While Akamai Technologies continues to grow its cloud computing services, its profitability metrics reflect ongoing transformation costs. In Q4 2024, Akamai’s GAAP net income declined 13% year-over-year to $140 million, while GAAP operating margin fell to 15% from 19% in Q4 2023. However, its non-GAAP income from operations remained stable at $298 million, demonstrating strong underlying profitability in its cloud and security business.

For the full-year 2024, Akamai’s non-GAAP net income increased 4% to $996 million, with non-GAAP earnings per diluted share reaching $6.48, up from $6.20 in 2023. These results highlight Akamai’s ability to sustain strong earnings performance despite the declining legacy delivery segment.

The strategic cloud partnership, coupled with continued investment in cloud computing services, is expected to drive long-term profitability, with cloud revenue growth offsetting declines in legacy segments. Akamai’s ability to secure multi-year, high-value enterprise agreements strengthens its financial resilience, supporting future revenue expansion in cloud security and infrastructure.

What does Akamai’s $100M cloud deal mean for the broader cloud market?

The strategic cloud partnership signals a broader enterprise shift toward diversified cloud computing services beyond hyperscalers. As businesses seek multi-cloud strategies that offer cost efficiency, performance optimization, and enhanced security, Akamai’s cloud computing expansion could reshape industry dynamics.

Akamai’s growing presence in the enterprise cloud sector challenges the dominance of AWS, Microsoft Azure, and Google Cloud, offering a distributed cloud infrastructure designed for real-time security and compliance management. With organizations increasingly focused on risk mitigation and regional cloud deployment, Akamai’s low-latency, cybersecurity-enhanced cloud solutions provide a compelling alternative to traditional hyperscaler models.

Industry analysts suggest that Akamai’s cloud computing services could drive increased enterprise adoption, particularly among large-scale global businesses prioritizing security, scalability, and cost-effective cloud models. As cloud adoption trends evolve, Akamai’s strategic focus on cybersecurity and infrastructure positions it as a leader in the next phase of cloud innovation.

What’s next for Akamai’s cloud business?

With $100 million in new cloud commitments, Akamai Technologies is poised to accelerate cloud infrastructure investments, expanding its secure, distributed cloud computing services. The company’s roadmap includes enhanced AI-driven security features, improved data processing capabilities, and deeper integrations with enterprise cloud applications.

As Akamai Technologies strengthens its cloud security and infrastructure portfolio, it is well-positioned to capture a growing share of the enterprise cloud market, offering businesses a scalable, high-performance cloud alternative. With continued enterprise adoption of hybrid and multi-cloud strategies, Akamai’s cybersecurity-driven cloud solutions could play a pivotal role in the future of cloud computing.