Akamai Technologies Inc. (NASDAQ:AKAM), which provides content
delivery and cloud infrastructure services, reported a 15% decrease in
first quarter earnings due to higher costs and expenses, as well as an
increase in provision for taxes. Despite earnings and revenue exceeding
Street's expectations, its shares fell 6.09% in aftermarket.
Earnings for the first quarter were $43.23 million or $0.24 per
share, down from $50.62 million or $0.26 per share last year. Normalized
earnings rose to $75.19 million or $0.41 per share from $72.23 million
or $0.38 per share.
Revenue increased to $319.45 million from $275.95 million. Analysts
had expected a profit of $0.38 per share on revenue of $310.70 million.
through resellers and sales outside the United States accounted for 21%
and 28%, respectively, of revenue for the first quarter of 2012.
Total costs and operating expenses for the quarter were $247.87
million, up from $203.21 million last year. Operating income declined to
$71.58 million from $72.75 million.
Provision for income taxes for the quarter rose to $29.56 million from $24.06 million last year.
Additionally, Akamai said its board of directors has authorized a
$150 million extension of its share repurchase program, effective for a
12-month period beginning on May 1, 2012. The company's goal for this
program, which is expected to be funded by cash from operations, is
primarily to offset dilution created by its equity compensation
During the first quarter of 2012, under its current share repurchase
program, the company repurchased about 223,000 shares of its common
stock for $8 million, an average price of $35.45 per share.
March 31, 2012, the company had repurchased 18 million shares of its
common stock for $491 million, at an average price of $26.86 per share
since April 2009. The company had about 179 million shares of common
stock outstanding as of March 31, 2012.
AKAM closed Wednesday's regular session up 2.68% at $38.75. The stock
has been trading between $18.25 and $41.25 for the past 52 weeks.