Fastly, Inc. (NYSE:FSLY) reported better-than-expected second quarter results on Wednesday, but shares tumbled 15.2% in after-hours trading as the company's guidance fell short of analyst expectations.
The edge cloud platform provider posted adjusted earnings per share of -$0.07, beating the consensus estimate of -$0.08. Revenue came in at $132.4 million, up 8% YoY and slightly above the $131.57 million analysts were expecting.
However, Fastly's outlook for the third quarter and full year 2024 disappointed investors. The company forecast Q3 revenue of $130-134 million, well below the $140 million consensus. For the full year, Fastly now expects revenue of $530-540 million, down from its previous guidance and missing the $558 million analyst estimate.
"We continued to drive customer acquisition in the second quarter, achieving 4% sequential growth in Enterprise customer count," said CEO Todd Nightingale. "However, we are experiencing demand challenges with some of our largest customers, and we are taking measures to align our cost structure accordingly."
The company's enterprise customer count grew to 601 in Q2, up from 577 in Q1. However, Fastly's last 12-month net retention rate declined to 110% from 114% in the previous quarter.
Despite the revenue growth, Fastly reported a GAAP net loss of $43.7 million for the quarter. The company's non-GAAP gross margin improved to 58.5% from 56.6% a year ago.
