Akamai cuts 5 percent of workforce as Q4 tops expectations

The company is cutting workers primarily in its media division as it aims to improve margins.
Written by Larry Dignan, Contributor

Akamai said that it is has cut about 5 percent of its workforce in "targeted areas" of its business, notably its media unit.

The restructuring was outlined on a conference call following Akamai's fourth quarter earnings report. Leighton said:

As part of our effort to improve operational efficiency, we reduced headcounts in targeted areas of business, most notably in areas tied to our media business. Overall, we've removed about 400 positions or 5% of our global workforce in a series of actions that began last quarter and that continued this week.

The company took a $52 million restructuring charge in the fourth quarter.

For the fourth quarter, Akamai reported fourth quarter earnings of $19 million, or 11 cents a share, on revenue of $663 million, up 8 percent from a year ago. Non-GAAP earnings for the fourth quarter was 69 cents a share. Wall Street was expecting earnings of 63 cents a share on revenue of $649.1 million.

Akamai saw strong growth it its Web division, up 17 percent from a year ago, and enterprise and carrier unit, up 24 percent. The media division, Akamai's unit that speeds up Web pages, saw fourth quarter revenue fall 3 percent.

Security related tools fared well both on-premises and in the cloud.

For 2017, Akamai reported net income of $453 million, or $1.26 a share, on revenue of $2.5 billion, up 7 percent from a year ago.

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