Fastly Earnings: First Non-GAAP Profit, AI Tailwinds
Fastly earnings showed Q4 and FY-2025 revenue and EPS beats and the first non-GAAP profitable year, spurring renewed investor interest and heavier trading.
KEY TAKEAWAYS
- Q4 revenue $173M, up 23%, with non-GAAP EPS $0.12 and GAAP loss $(0.10).
- FY 2025 revenue $624M and first non-GAAP net income $20.1M.
- 2026 guidance calls for revenue $700M to $720M and non-GAAP operating income $50M to $60M.
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Fastly, Inc. (FSLY) reported fourth-quarter and full-year 2025 results on Feb. 11, 2026, showing revenue and EPS beats and the company’s first non-GAAP profitable year. Management attributed momentum to AI-driven traffic and growing security demand.
Quarter and Full-Year Results
Fastly’s fourth-quarter revenue reached $173 million, up 23.0% year over year and above the $161.4 million consensus. Non-GAAP diluted earnings per share were $0.12, beating the $0.06 estimate, while GAAP net loss per share was $(0.10). Non-GAAP gross margin hit a record 64.0%, compared with a GAAP gross margin of 61.4%. CEO Kip Compton said, “Our fourth quarter results mark an inflection in Fastly’s growth as we achieved record revenue, gross margin, and operating profit.”
For the full year, revenue totaled $624 million, a 14.7% increase from 2024. Fastly posted $20 million in non-GAAP net income, marking a shift in its profitability profile that management said supports its 2026 outlook.
AI Growth, RPO, and Outlook
Product revenue in the quarter was led by Network Services at $131 million, up 19.0% year over year; Security at $35 million, up 32.0% and representing 21.0% of total revenue; and Other at $6 million, rising about 78.0% sequentially. Management highlighted AI tailwinds and stronger security demand as key drivers of this product mix.
Remaining performance obligations (RPO) totaled $354 million, up 55.0% year over year. Current RPO accounted for 70.0% of the total and rose 37.0% year over year. The trailing 12-month net retention rate increased to 110.0% from 106.0% in the prior quarter. Enterprise customers numbered 628, slightly below the estimate of 648.
Fastly issued 2026 guidance calling for first-quarter revenue between $168 million and $174 million, non-GAAP gross margin around 64.0% plus or minus 50 basis points, non-GAAP operating income of $14 million to $18 million, and non-GAAP EPS of $0.07 to $0.10 on about 175 million diluted shares. Full-year guidance projects revenue of $700 million to $720 million, non-GAAP gross margin near 63.0% ±50 basis points, non-GAAP operating income of $50 million to $60 million, non-GAAP EPS of $0.23 to $0.29, and free cash flow of $40 million to $50 million. The plan assumes continued AI tailwinds, disciplined execution, and seasonal margin patterns. Fastly will discontinue reporting total customer counts and annual revenue retention, focusing instead on trailing-12-month net retention and infrastructure capital expenditures (CapEx).
Fastly ended 2025 with about $362 million in cash and recently raised $180 million through zero-percent convertible notes. Capital spending in 2025 ran at roughly 9.0% of revenue, with about $10 million shifted into 2026. Management expects infrastructure CapEx to run about 10.0% to 12.0% of revenue going forward.
