Kurt Peters , Senior Executive Editor
Record fourth quarter revenue of $45.2 million, up 8% quarter-over-quarter, and up 28% year-over-year
Annual revenue grew to $161.3 million, up 11% year-over-year
GAAP net loss narrowed to $0.02 per share
First ever normalized net income* of $1.5 million, or $0.01 per share
CAMBRIDGE, Mass. - February 4, 2004 - Akamai Technologies, Inc. (NASDAQ: AKAM), the global leader in distributed computing solutions and services, today reported financial results for the fourth quarter and full-year ended December 31, 2003. Revenue for the fourth quarter 2003 was $45.2 million, an 8.1 percent increase over third quarter revenue of $41.8 million, and a 27.7 percent increase over fourth quarter 2002 revenue of $35.4 million. Total revenue for 2003 was $161.3 million.
Net loss, in accordance with United States Generally Accepted Accounting Principles (GAAP), for the fourth quarter 2003 was $2.1 million, or $0.02 per share, compared to a net loss for the third quarter 2003 of $3.9 million, or $0.03 per share, and compared to a net loss of $55.6 million, or $0.48 per share, in the fourth quarter of 2002. Included in the fourth quarter 2003 net loss is $2.1 million of expenses associated with the retirement of debt.
For the first time in its history, the Company achieved positive earnings per share of $0.01 on a normalized basis*, generating $1.5 million positive net income for the fourth quarter, compared to a normalized net loss* for the prior quarter of $0.03 per share, or $3.5 million, and compared to First Call`s consensus estimate for the fourth quarter of a normalized net loss of $0.01 per share. (*See Use of Non-GAAP Financial Measures below for definitions.)
Akamai ended the year with $208.4 million in cash, cash equivalents, restricted cash, marketable securities and restricted marketable securities, including $95.8 million in net debt proceeds and redemptions, an increase from $99.0 million at the end of the third quarter.
"The fourth quarter of 2003 was our best quarter to date," said George Conrades, chairman and CEO of Akamai. "We achieved the most revenue of any quarter; the most cash flow from operations in any quarter; and, marking the most important improvement in our five-year history, we generated positive earnings per share on a normalized basis. All of this capped a year of consistent revenue growth and rapidly declining losses."
Adjusted EBITDA* for the fourth quarter of 2003 was $14.2 million, a 21 percent increase from $11.7 million in the prior quarter, and over a ten fold increase over Adjusted EBITDA of $1.3 million in the fourth quarter of 2002. (*See Use of Non-GAAP Financial Measures below for definitions.)
"With revenue growth in 2003 of 11 percent year-over-year, improvement in gross margins, and a decrease in cash operating expenses of 25 percent year-over-year, we`re clearly seeing the leverage in our model," continued Conrades.
The number of recurring customers grew in the fourth quarter by 70 net new accounts for a total of 1,126 customers under long-term services contracts, the highest level in more than two years. For the full year, the Company`s customer count increased almost 18 percent.
New Akamai EdgeSuite® customers in the fourth quarter included Americanas (Brazil`s leading e-retailer), AUDI AG, Bayer AG, Brylane, Christian Dior, Knight Ridder Digital, Learning.com, Muze Inc., OfficeMax Inc., Overstock.com, ScanAlert and Tourism New Zealand, among others.
Resellers accounted for approximately 25 percent of 2003 fourth quarter revenue, as compared to approximately 22 percent in the prior quarter and 26 percent in the fourth quarter of 2002.
Akamai`s global network at the end of the fourth quarter consisted of 14,733 servers in 1,072 networks, in 71 countries. The geographic reach and capacity of Akamai`s network is unprecedented in its ability to serve the needs of enterprise customers, government agencies and major Web-centric businesses.
Akamai Technologies Inc.
Sandy Smith Investor Relations Akamai Technologies Inc. 617-444-2804 firstname.lastname@example.org