Akamai shares surge after $11.6 billion deal with Anthropic
Shares of Akamai surged on Friday following the announcement of an $11.6 billion contract with AI company Anthropic to provide cloud computing capacity over seven years, potentially expanding up to $20 billion. The agreement focuses on CPU-based infrastructure rather than GPUs and is expected to drive significant capital spending by Akamai—$5.5 billion in total—to meet the demand. Analysts from major firms like Morgan Stanley, Piper Sandler, DA Davidson, Oppenheimer, and Evercore ISI have upgraded their ratings for Akamai, citing strong growth potential driven by this deal and others within its Cloud Infrastructure Services (CIS) segment. The company has secured $14.6 billion in cloud commitments year-to-date with projected EBIT margins of around 30% at full revenue run-rate. The partnership is seen as a major shift for Akamai, transforming it from a 'value' asset to one of 'hypergrowth.' Analysts also highlighted the potential for additional large-scale deals and broader applications across AI-driven sectors like robotics, real-time simulations, and video intelligence.
Tickers: $AKAM
Topics: AI computing capital spending cloud services stock performance