Benzinga | Feb 8, 2021 10:19AM EST

Akamai Technologies's Earnings: A Preview

On Tuesday, February 09, Akamai Technologies (NASDAQ:AKAM) will release its latest earnings report. Here is Benzinga's outlook for the company.

What Are Earnings, Net Income, And Earnings Per Share?

Earnings and EPS are useful metrics of profitability. Total earnings also known as net income is equal to total revenue minus total expenses. Dividing net income by the total number of shares outstanding yields EPS.

Earnings And Revenue

Wall Street expects EPS of $1.31 and sales around $829.46 million. Akamai Technologies earnings in the same period a year ago was $1.23 per share. Quarterly sales came in at $772.12 million.

Why Analyst Estimates And Earnings Surprises Are Important

Analysts who cover this company will publish forward-looking estimates of its revenue and EPS each quarter. Averaging together every EPS and revenue prediction that each analyst makes about a company in a quarter yields the "consensus estimates." A company posting earnings or revenue above or below the consensus estimate is known as an "earnings surprise" and may move the stock by a considerable margin.

The Wall Street estimate would represent a 6.5% increase in the company's earnings. Revenue would be up 7.43% from the year-ago period. Here is how the company's reported EPS has stacked up against analyst estimates in the past:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2020EPS Estimate 1.23 1.21 1.16 1.13EPS Actual 1.31 1.38 1.20 1.23Revenue Estimate 775.18 M 767.39 M 749.76 M 749.28 MRevenue Actual 792.85 M 794.72 M 764.30 M 772.12 M

Stock Performance

Over the last 52-week period, shares are up 20.91%. Given that these returns are generally positive, long-term shareholders can relax going into this earnings release. Long-term shareholders are already enjoying 12-month gains prior to the announcement.

Do not be surprised to see the stock move on comments made during its conference call. Akamai Technologies is scheduled to hold the call at 16:30:00 ET and can be accessed here.