10-Q · May 6, 2026
Fastly's Q1 2026 results show a robust recovery with $173 million in revenue, up 20% year-over-year, and an EPS of $0.13, exceeding analyst expectations. The growth is bolstered by a significant rise in security…
Earnings analysis · 10-Q
FSLY earnings analysis
Filed November 4, 2026 · Our reading of the company's report
The latest report
Fastly delivered strong Q3 operating momentum: revenue increased 20% year over year to $190.2 million, gross margin expanded to 63.3%, operating loss narrowed to $11.3 million, and diluted EPS improved to negative…
Read full summary
Fastly delivered strong Q3 operating momentum: revenue increased 20% year over year to $190.2 million, gross margin expanded to 63.3%, operating loss narrowed to $11.3 million, and diluted EPS improved to negative $0.07. Customer retention and large-customer metrics also strengthened, while nine-month operating cash flow rose to $108.2 million. Offsetting concerns are continued net losses, rising infrastructure spending, higher customer concentration, and material convertible-debt and execution risks; the filing provided no explicit numeric revenue or EPS guidance.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $-0.07
- Segment
- Fastly operates as one operating and reportable segment; Q3 2026 revenue was $190.2 million, up 20% year over year from $158.2 million.
- Segment
- United States revenue was $132.3 million, up 16% year over year from $114.2 million; revenue from all other countries was $57.9 million, up 31% from $44.1 million.
What stood out
-
Revenue growth accelerated to 20%
Q3 revenue was $190.2 million, increasing $32.0 million, or 20%, from $158.2 million in Q3 2025 and approximately 4% from $183.0 million in Q2 2026.
-
Gross margin reached 63%
Gross profit rose 30% year over year to $120.4 million from $92.3 million. Gross margin expanded to 63.3% from 58.4% a year earlier and was broadly stable versus 63.3% in Q2 2026.
-
Losses narrowed materially
Operating loss narrowed to $11.3 million from $28.8 million in Q3 2025, improving operating margin to approximately negative 5.9% from negative 18.2%. Diluted EPS improved to negative $0.07 from negative $0.20.
-
Retention and large customers improved
Customer expansion remained the primary revenue driver, with LTM net retention improving to 118.9% from 105.8% and large customers increasing to 634 from 627.
-
Operating cash generation strengthened
Operating cash flow increased to $108.2 million for the first nine months of 2026 from $72.0 million in the prior-year period. Capital expenditures were $63.6 million and capitalized internal-use software was $11.7 million.
-
Liquidity and credit access remain solid
Liquidity totaled $365.2 million of cash, cash equivalents, and marketable securities at September 30, 2026. The company also increased its revolving credit commitment from $60.0 million to $100.0 million and reported compliance with all debt covenants.
What to watch
-
Customer concentration increased
Customer concentration increased: the 10 largest customers represented 39% of Q3 revenue versus 32% in Q3 2025, while one customer represented 12% of Q3 revenue and 12% of receivables.
-
Profitability remains unproven
The company continues to incur losses, reporting a nine-month net loss of $47.4 million and an accumulated deficit of $1,161.9 million. Management expects operating losses may continue as it invests in growth.
-
Capacity investment raises execution risk
Infrastructure investment and execution risk increased: property and equipment, net rose to $223.4 million from $186.8 million at December 31, 2025, while Q3 included a $1.0 million impairment charge for abandoned equipment.
-
Debt and covenant obligations remain material
The amended credit facility includes a consolidated adjusted quick-ratio covenant of at least 1.25 to 1.00 and a springing revenue-growth covenant of at least 5% in specified circumstances. The company had $330.0 million of convertible notes outstanding at September 30, 2026.
-
Convertible notes create dilution risk
The 2030 Notes became convertible at the holder's option from October 1 through December 31, 2026, and approximately 19.4 million shares could be issued upon conversion of the Notes, creating potential dilution or cash requirements.
-
Platform, cyber, and AI risks expanded
Risk-factor updates marked substantive include platform outage and performance risk, cybersecurity and IT-system risk, and AI regulatory risk. The filing cites $333.5 million of remaining performance obligations, but customer usage remains substantially usage-based and could be affected by outages or changing AI regulations.
Management's outlook
No explicit quantitative revenue or EPS guidance was provided in the 10-Q. Management stated that cash, cash equivalents, available borrowing capacity, and operating cash flow are expected to satisfy anticipated working-capital and capital-expenditure needs for at least the next 12 months. Management also expects total operating expenses to increase as it expands sales, marketing, product, and international capabilities.
Earlier filings 4
10-K · February 25, 2026
Fastly positions itself as an AI-ready unified edge cloud platform focused on programmable edge compute, security, and CDN capabilities. Fiscal 2025 shows an inflection: revenue rose to $624.0M (from $544.0M in 2024),…
10-Q · May 7, 2025
Fastly reported revenue of $144,474,000 for the quarter ended March 31, 2025, up from $133,520,000 a year ago, with gross profit of $76,798,000 and an improving operating loss of $(38,179,000). Operating cash flow was…
10-K · February 26, 2025
Fastly positions itself as a programmable edge cloud platform focused on performance, security and developer-friendly tooling (including Fastly Compute built on WebAssembly). Revenue grew to $543.7M in 2024 from $506.0M…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.