Key Highlights

● Second-quarter revenue was US$183.3 million, up 23% year on year.

● Security revenue rose 43% to US$41.7 million, outpacing Network Services at 17%.

● Net retention rose to 117%, and remaining performance obligations were US$341 million.

● Full-year 2026 revenue guidance is US$732 million to US$746 million.

Latest verified development

Fastly, Inc. (NYSE:FSLY), the edge cloud and content delivery platform, reported second-quarter 2026 results on 5 August 2026. Revenue was US$183.3 million, up 23% year on year. Network Services revenue was US$133.9 million, up 17%, Security revenue was US$41.7 million, up 43%, and Other revenue was US$7.7 million, up 69%.

Last-twelve-month net retention rose to 117% from 113% in the first quarter, and remaining performance obligations were US$341 million, up 38%. Chief executive Kip Compton described record second-quarter results and credited strong execution and customer trust.

The mix is shifting. Using the reported figures, Security made up about 23% of revenue and Network Services about 73%, with Security growing more than twice as fast. A larger security contribution can matter for the business because it broadens what each customer buys, although the release did not describe pricing or margin by product line.

Profitability and cash flow

Fastly's GAAP net loss narrowed to US$15.6 million, or US$0.10 per share, from US$37.5 million a year earlier. On a non-GAAP basis it earned US$26.2 million, or US$0.15 per diluted share, compared with a non-GAAP loss of US$5.0 million in the second quarter of 2025. GAAP gross margin was 63.3% and non-GAAP gross margin 65.8%.

Cash flow was less striking. Operating cash flow was US$39.3 million, but free cash flow was US$3.6 million, down from US$10.9 million a year earlier.

Guidance and customer concentration

For the third quarter, Fastly guided to revenue of US$184.0 million to US$190.0 million, non-GAAP operating income of US$20 million to US$24 million and non-GAAP earnings per share of US$0.11 to US$0.13. For 2026 it guided to revenue of US$732 million to US$746 million, non-GAAP operating income of US$88 million to US$96 million and non-GAAP earnings per share of US$0.50 to US$0.54. Both ranges are company guidance, not results.

The ten largest customers accounted for 37% of revenue, up from 31% a year earlier. Greater concentration can magnify the effect of any change in a single large customer's usage.

At the midpoint, third-quarter revenue guidance of US$187.0 million is about 2% above the second-quarter figure, a slower sequential pace than the year-on-year growth of 23% might suggest. The full-year midpoint is US$739 million.

Contracted revenue and free cash flow gap

Remaining performance obligations of US$341 million offer a partial view of contracted revenue, though they are not a forecast of sales. Net retention of 117% and Security growth of 43% against Network Services growth of 17% frame the shift in what customers buy.

Against those gains, free cash flow of US$3.6 million sits well below non-GAAP net income of US$26.2 million.