Akamai Lands Record $1.8 Billion AI Deal as Cloud Unit Surges 40%

Akamai Technologies has secured the largest contract in its nearly three-decade history, a seven-year agreement worth $1.8 billion with a leading US developer of artificial intelligence models. The deal marks a decisive pivot for the company as it transforms from a legacy content delivery specialist into a dedicated AI infrastructure provider.

The stock rocketed nearly 30% on Friday, hitting a fresh all-time high of €126.88. That pushed year-to-date gains to roughly 75%, though the initial after-hours reaction had been more cautious as investors weighed the hefty capital expenditure required to fulfill the contract. By the close of the regular session, the shares had surged around 20% on the day and touched a 52-week high of €117.24.

Akamai's first-quarter results underscored the shifting business mix. Total revenue rose 6% to $1.074 billion, while adjusted earnings per share came in at $1.61, slightly ahead of expectations. Net income, however, fell to $106 million from the prior-year period, reflecting the ramp-up in spending.

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The standout performer was the Cloud Infrastructure Services (CIS) segment, where revenue jumped 40% to $95 million. Security remained the largest division, growing 11% to $590 million, driven by demand for web application and interface protection. The legacy delivery business, by contrast, contracted 7%.

Management plans to reinvest up to 42% of total revenue this year, with $700 million earmarked specifically for the new AI contract. Capital spending will cover new data centers and graphics processors needed to support the workload. The operating margin is expected to hold steady at around 26%.

For the full year, Akamai forecasts adjusted earnings in a range of $6.40 to $7.15 per share, with total revenue reaching as high as $4.55 billion. The company anticipates that the cloud contracts will drive revenue growth back into double digits from 2027 onward, positioning it as a critical infrastructure partner for the AI economy.

The transformation is already reshaping the company's financial profile. Adjusted profit dipped to $239 million in the quarter as investment spending weighed on the bottom line, but the long-term trajectory hinges on the ability to convert the AI pipeline into sustained, high-margin growth.

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